Dear Sir/Madam,
Please clarify the following:
(1) Company having EPF scheme. An employee gives a letter requesting "I don't desire to join EPF and please do not deduct my EPF from my salary."
Q. - Is it possible?
(2) Can EPF be deducted from Basic Salary only? Or from Basic + D.A.?
(3) From which month should the ceiling be raised to Rs. 15,000?
Thank you.
From India, Mumbai
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1Please clarify the following:
(1) Company having EPF scheme. An employee gives a letter requesting "I don't desire to join EPF and please do not deduct my EPF from my salary."
Q. - Is it possible?
(2) Can EPF be deducted from Basic Salary only? Or from Basic + D.A.?
(3) From which month should the ceiling be raised to Rs. 15,000?
Thank you.
From India, Mumbai
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Dear Sir/ Madam, Please inform present Basi Daily Wages and D.A. for engineering Unit in Mumbai. EPF to be deduct from Basic only OR combine with D.A. Rasik Parikh
From India, Mumbai
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From India, Mumbai
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Dear Friends,
PF has to be recovered from the Basic, Dearness Allowance, and also from Variable DA. If your organization is covered under PF, you have to recover it from all the employees. It is statutory. We cannot leave anybody out of this scheme. You need to explain to your employees that it is a social benefit for them and a means of saving for the future. Also, inform them that if they choose to leave (which is not recommended), they will only save their contribution, but if they continue, they will receive both their contribution and the management's contribution. Additionally, they will be eligible for retirement pension. In case something happens before leaving, their family will receive a monthly pension.
It is HR's duty to explain these welfare benefits to our employees. The PF ceiling is currently Rs. 6500.00 only. PF authorities are planning to raise the ceiling amount from Rs. 6500.00 to Rs. 15000 in the future, but not immediately.
Regards,
Alphonse
From India, Madras
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PF has to be recovered from the Basic, Dearness Allowance, and also from Variable DA. If your organization is covered under PF, you have to recover it from all the employees. It is statutory. We cannot leave anybody out of this scheme. You need to explain to your employees that it is a social benefit for them and a means of saving for the future. Also, inform them that if they choose to leave (which is not recommended), they will only save their contribution, but if they continue, they will receive both their contribution and the management's contribution. Additionally, they will be eligible for retirement pension. In case something happens before leaving, their family will receive a monthly pension.
It is HR's duty to explain these welfare benefits to our employees. The PF ceiling is currently Rs. 6500.00 only. PF authorities are planning to raise the ceiling amount from Rs. 6500.00 to Rs. 15000 in the future, but not immediately.
Regards,
Alphonse
From India, Madras
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(Fact Check Failed/Partial)-The user's reply contains some inaccuracies: 1. PF should be deducted from Basic Salary + D.A. + Variable DA. 2. The PF ceiling is currently Rs.15,000, not Rs.6,500. 3. It is mandatory for all eligible employees to be part of the EPF scheme. Reference: The Employees' Provident Funds and Miscellaneous Provisions Act, 1952.
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Dear rnpkrp,
The Government of India has started the PF scheme to provide social security to the employees of various establishments. The scheme has a host of benefits, including old age pension. My colleague Sh. Alphonse has rightly mentioned that if the establishment where you are working is covered and registered under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, you have no choice unless you fall into the following exception categories: -
(i) If you are a new employee to your present company drawing a wage/salary above Rs. 6500/- and were not a member of the Employees' Provident Funds Scheme earlier or if a member, you have drawn your PF accumulations. In such a case, you will not be enrolled as a member of the PF scheme. As per Para 33 of the Employees' Provident Funds Scheme, 1952, upon joining a new establishment, you need to give a declaration in Form-2 and furnish information to your employer regarding your earlier company and PF account no., if any. In view of the definition, your basic salary shall be considered for the purpose of the deduction of your PF contribution.
Regarding your second query, unlike other enactments, the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, has defined "basic wages" instead of wages, which includes all emoluments earned by an employee while on duty but does not include (i) the cash value of any food concession; (ii) any dearness allowance (iii) house-rent allowance (iv) overtime allowance (v) bonus and (vi) commission or any other similar allowance payable to the employee or (vi) any presents made by the employer.
As for your last query, EPFO has forwarded a proposal to increase the salary limit and reduce the coverage threshold from twenty persons to ten to the Ministry of Labour for approval.
BS Kalsi
Member since Aug 2011
From India, Mumbai
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The Government of India has started the PF scheme to provide social security to the employees of various establishments. The scheme has a host of benefits, including old age pension. My colleague Sh. Alphonse has rightly mentioned that if the establishment where you are working is covered and registered under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, you have no choice unless you fall into the following exception categories: -
(i) If you are a new employee to your present company drawing a wage/salary above Rs. 6500/- and were not a member of the Employees' Provident Funds Scheme earlier or if a member, you have drawn your PF accumulations. In such a case, you will not be enrolled as a member of the PF scheme. As per Para 33 of the Employees' Provident Funds Scheme, 1952, upon joining a new establishment, you need to give a declaration in Form-2 and furnish information to your employer regarding your earlier company and PF account no., if any. In view of the definition, your basic salary shall be considered for the purpose of the deduction of your PF contribution.
Regarding your second query, unlike other enactments, the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, has defined "basic wages" instead of wages, which includes all emoluments earned by an employee while on duty but does not include (i) the cash value of any food concession; (ii) any dearness allowance (iii) house-rent allowance (iv) overtime allowance (v) bonus and (vi) commission or any other similar allowance payable to the employee or (vi) any presents made by the employer.
As for your last query, EPFO has forwarded a proposal to increase the salary limit and reduce the coverage threshold from twenty persons to ten to the Ministry of Labour for approval.
BS Kalsi
Member since Aug 2011
From India, Mumbai
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(Fact Check Failed/Partial)-The information provided in the user reply is mostly correct, with accurate details on PF scheme rules and exceptions. However, there is a minor error in the response related to the salary limit proposal. The EPFO proposed to raise the salary limit to Rs. 15,000, not to reduce it.
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(Fact Check Failed/Partial)-The user reply contains incorrect information.