Realise PF needs to be contributed on basic wage that should not be lesser than the minimum wage in effect in the state it is also ok if PF is contributed on the prescribed stat limit of 15000.00. What should be the contribution of PF in states where MW is greater than 15000.00?
From India
From India
dispute is mainly on the split of wages in various allowances to avoid the EPF contribution, and SC ruling has cleared that such splits are not to be considered during EPF deduction
if the establishment is maintaining the ceiling of 15000/- then they continue, as the employee and employer both has paid 1800/- each, for the employees who earn salary of 15000 or more per month,
but where the salary is less than 15000/- employers has to take measures and evidence of allowances, otherwise they would be liable to pay "both share" of EPF on such split allowances
632if the establishment is maintaining the ceiling of 15000/- then they continue, as the employee and employer both has paid 1800/- each, for the employees who earn salary of 15000 or more per month,
but where the salary is less than 15000/- employers has to take measures and evidence of allowances, otherwise they would be liable to pay "both share" of EPF on such split allowances
There is nothing wrong in paying PF contribution on a salary which is less than the statutory minimum wages fixed by the state so long as there is no further reduction in the PF contributing salary. EPFO is not the authority to enforce minimum wages for which there is labour department nor the EPF officials direct that you first pay the employees the minimum rates fixed and then pay PF on that wages. If you employ people on wages less than minimum wages, it can be questioned by the Labour department but not by EPFO. They can only see whether the PF is paid on the entire sum which is agreed with the employees.
In respect of employees whose salary is above Rs 15000 also the same thing happens.The EPFO can not demand contribution above Rs 15000 as a legal right. There are alot of employee grades whose minimum wages is above Rs 15000 and that was the reason why EPFO failed to implement their decision to enforce payment of PF on minimum wages. Now, since the Supreme Court has clarified that it is the total salary which will qualify for PF contribution, there is no need to press for minimum wages. The employers are bound to pay contribution on total wages paid or payable.
From India, Kannur
In respect of employees whose salary is above Rs 15000 also the same thing happens.The EPFO can not demand contribution above Rs 15000 as a legal right. There are alot of employee grades whose minimum wages is above Rs 15000 and that was the reason why EPFO failed to implement their decision to enforce payment of PF on minimum wages. Now, since the Supreme Court has clarified that it is the total salary which will qualify for PF contribution, there is no need to press for minimum wages. The employers are bound to pay contribution on total wages paid or payable.
From India, Kannur
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
SC Judgment-No obligation to excess contribution than Statutory Limit.docx
Sc-judgment-eps -1995_english.p df