Hello,
In my organization, there are many new recruits who have salaries of more than 15,000/- and do not want any deduction or contribution to the PF. I have heard that there is a provision by which these employees can be excluded. Can the experienced members please guide us on these provisions and the procedure?
From India, Jalgaon
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In my organization, there are many new recruits who have salaries of more than 15,000/- and do not want any deduction or contribution to the PF. I have heard that there is a provision by which these employees can be excluded. Can the experienced members please guide us on these provisions and the procedure?
From India, Jalgaon
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As far as PF deduction is concerned, you can follow the following methods:
a) If any of the first-time employees (entry-level after education), and if their basic is more than Rs. 15,000 per month, you can exempt them from covering under the PF Act. Instead, you can include the Employer Contribution value in their CTC.
b) For existing employees whose basic is higher than Rs. 15,000 per month, you can restrict the PF deduction up to Rs. 15K, which is mandatory.
c) When considering annual increments, you can slightly increase the HRA component if it is very low right now, so that you can exempt HRA from PF coverage. This will be beneficial only if the basic is less than Rs. 15K. Otherwise, in the normal course, you can't do anything to cover employees under the clutches of the Provident Fund.
Regards,
From India, Madras
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15a) If any of the first-time employees (entry-level after education), and if their basic is more than Rs. 15,000 per month, you can exempt them from covering under the PF Act. Instead, you can include the Employer Contribution value in their CTC.
b) For existing employees whose basic is higher than Rs. 15,000 per month, you can restrict the PF deduction up to Rs. 15K, which is mandatory.
c) When considering annual increments, you can slightly increase the HRA component if it is very low right now, so that you can exempt HRA from PF coverage. This will be beneficial only if the basic is less than Rs. 15K. Otherwise, in the normal course, you can't do anything to cover employees under the clutches of the Provident Fund.
Regards,
From India, Madras
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When a new employee joins your organization, you should collect Form 11 to confirm that they were not covered by EPF earlier. In the absence of Form 11, you cannot ensure that, in the future, the same employee will not demand PF coverage, claiming they were previously covered under EPF. Therefore, to err on the side of caution, collect Form 11, which will indicate whether the employee was a member of EPF in their previous employment. If the employee declares previous PF membership, you should not exclude them from PF. Conversely, if they declare no PF membership, you can exclude them from PF provided their PF qualifying salary exceeds Rs 15,000.
From India, Kannur
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From India, Kannur
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If the monthly gross salary (PF Gross) excluding HRA and any other productivity-linked payment (Production incentive, etc.) is as of the date 15k or less based on the declaration by the employee through Form-11, they must be covered under the EPFO as a member. If the employee was not a member of the EPFO earlier and is joining with a PF Gross of more than 15K, or was a member of EPFO but left the service and is again joining with a gap at a salary level more than 15K or after attaining the age of 58 years, settled EPF & EPS is considered an excluded employee. Excluded employees may be out of the purview of the EPFO, but voluntarily, they may become a member.
No employee or employer has the right to exclude any employee from the coverage of the EPFO if he/she fulfills the above coverage conditions.
S K Bandyopadhyay (WB, Howrah) CEO-USD HR Solutions +91 98310 81531 skb@usdhrs.in www.usdhrs.in
From India, New Delhi
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No employee or employer has the right to exclude any employee from the coverage of the EPFO if he/she fulfills the above coverage conditions.
S K Bandyopadhyay (WB, Howrah) CEO-USD HR Solutions +91 98310 81531 skb@usdhrs.in www.usdhrs.in
From India, New Delhi
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HC All - Trainees not covered for PF -2010.pdf
PF Ledger.xls