Hello, I work with a technology startup, and after one year of inception, we are introducing PF in our organization. The difficulty is communicating with employees that their CTC will attract the deduction going forward. Can you please help if any of you have shared similar communication with employees in the recent past? I want to refer to this to ensure that we are in the right direction.
From India, Bangalore
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From India, Bangalore
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How can their CTC change? In fact, their CTC is going to increase even though their take-home salary will decrease, and that is only temporary. Whatever they contribute will be available to them as an investment, and along with that, they would get the employer's share as well.
Therefore, just send a circular stating that "effective from ....(date), our organization has come under the coverage of EPF & MP Act. All the employees (who come under the salary band as per PF Act or the company policy) will be contributing 12% of their salary (basic, DA, etc.) to EPF. All are also informed that there will be an employer's contribution of 12%, and the same will be accounted for as a contribution towards your Pension Fund and Provident Fund. The employees can view their Passbook periodically by visiting the website of the Employee Provident Fund Organization."
This will remove the doubts of employees. If anyone comes to you with any doubts or apprehensions, you can explain the benefits of the provident fund, pension fund, and EDLI. And if they are still not interested, simply say that we cannot work without following the law, but they can decide if they want to continue here. If they are not ready, just ask them to leave. That's all.
One more thing, if you hesitate to take steps now, you will not be able to proceed further because there will be a lot of hurdles, and nothing will pave the way, considering that yours is a start-up establishment.
From India, Kannur
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4765Therefore, just send a circular stating that "effective from ....(date), our organization has come under the coverage of EPF & MP Act. All the employees (who come under the salary band as per PF Act or the company policy) will be contributing 12% of their salary (basic, DA, etc.) to EPF. All are also informed that there will be an employer's contribution of 12%, and the same will be accounted for as a contribution towards your Pension Fund and Provident Fund. The employees can view their Passbook periodically by visiting the website of the Employee Provident Fund Organization."
This will remove the doubts of employees. If anyone comes to you with any doubts or apprehensions, you can explain the benefits of the provident fund, pension fund, and EDLI. And if they are still not interested, simply say that we cannot work without following the law, but they can decide if they want to continue here. If they are not ready, just ask them to leave. That's all.
One more thing, if you hesitate to take steps now, you will not be able to proceed further because there will be a lot of hurdles, and nothing will pave the way, considering that yours is a start-up establishment.
From India, Kannur
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HC All - Trainees not covered for PF -2010.pdf
PF Ledger.xls