Hi All,
I request you to share your thoughts on the following topic :
Normally with employees 20 and above, PF is mandatory. But, if the employer says "I don't want to run this all PF show, I fixup the CTC without PF, whoever will be interested, them only I will take" then what will happen ?
Suppose some X's basic is 7000. Upto 6500 basic pf employer's share is compulsory. For above 6500 basic it is optional to employer. Means for x he can pay @ 12% * 6500 and he need not pay on total 7000. Please confirm, is it correct or not ?
Thanks,
VS
From India, Hyderabad
I request you to share your thoughts on the following topic :
Normally with employees 20 and above, PF is mandatory. But, if the employer says "I don't want to run this all PF show, I fixup the CTC without PF, whoever will be interested, them only I will take" then what will happen ?
Suppose some X's basic is 7000. Upto 6500 basic pf employer's share is compulsory. For above 6500 basic it is optional to employer. Means for x he can pay @ 12% * 6500 and he need not pay on total 7000. Please confirm, is it correct or not ?
Thanks,
VS
From India, Hyderabad
Dear VS,
The first thing I would like to clear at the very onset is that there is a lot of dispute regarding the issue.
But as of now, any employee who is not a member of any PF (new applicant) can opt to stay out of PF if his basic salary is over 6500/- if he gives a declaration in this regard in writing.
For example if this is your first job and your basic is over 6500/- you can opt out of PF making a declaration in writing.
As for the following
It is not correct, you cannot break the Basic and contribute like that once it is under PF.
Regards,
SC
From India, Thane
45The first thing I would like to clear at the very onset is that there is a lot of dispute regarding the issue.
But as of now, any employee who is not a member of any PF (new applicant) can opt to stay out of PF if his basic salary is over 6500/- if he gives a declaration in this regard in writing.
For example if this is your first job and your basic is over 6500/- you can opt out of PF making a declaration in writing.
As for the following
It is not correct, you cannot break the Basic and contribute like that once it is under PF.
Regards,
SC
From India, Thane
Hi,
Would appreciate a further clarification on PF. Suppose in a senario where a person is drawing above Rs 6500 per month basic and in an earlier employment had getting the PF deducted. Can this person in a new employment decide to opt out of the PF scheme. He could always close his PF account.
Regards
Revati
From India, Mumbai
Would appreciate a further clarification on PF. Suppose in a senario where a person is drawing above Rs 6500 per month basic and in an earlier employment had getting the PF deducted. Can this person in a new employment decide to opt out of the PF scheme. He could always close his PF account.
Regards
Revati
From India, Mumbai
Dear Revati,
No, I dont think so, once covered always covered. But kindly confirm with PF authorities.
One more thing, I wish to ask everyone, why do you want to opt out of PF and even if the Employer wants please dont support this move. This Social Security Fund is a very good post retirement benefit scheme and there are very few or almost no options available in the current market which can match PF in terms of Assured Returns, Security and Tax benefit. Dont opt out, it would be naive to do so.
Regards,
SC
From India, Thane
No, I dont think so, once covered always covered. But kindly confirm with PF authorities.
One more thing, I wish to ask everyone, why do you want to opt out of PF and even if the Employer wants please dont support this move. This Social Security Fund is a very good post retirement benefit scheme and there are very few or almost no options available in the current market which can match PF in terms of Assured Returns, Security and Tax benefit. Dont opt out, it would be naive to do so.
Regards,
SC
From India, Thane
Hi,
As per the employees Provident Fund Rules 1952, In a factory wherein 20 or more employees are ordinarily employed during the year, the factory need to be covered under the PF act. Since PF being a social security measure, it is mandatory for the Organisation. to cover all the employees under the Act. Even if the employees exceeds the ceiling, even then they can be covered considering the welfare and security of an employee.
As far as PF exemption, it should satisfy the PF authorities, and the employer should prove that the benefit provided by the management is far more superior than the Provident Fund.
otherwise it is obligatory on the part of every employer to cover all the employees from the day one of their joining.
devarajan
From India, Madras
As per the employees Provident Fund Rules 1952, In a factory wherein 20 or more employees are ordinarily employed during the year, the factory need to be covered under the PF act. Since PF being a social security measure, it is mandatory for the Organisation. to cover all the employees under the Act. Even if the employees exceeds the ceiling, even then they can be covered considering the welfare and security of an employee.
As far as PF exemption, it should satisfy the PF authorities, and the employer should prove that the benefit provided by the management is far more superior than the Provident Fund.
otherwise it is obligatory on the part of every employer to cover all the employees from the day one of their joining.
devarajan
From India, Madras
At no streach of imagination you can excude your establishment from the operation of EPF Act, in case if you employ 20 or more employees. It is an Act enacted by Parliament and no authority can dilute it.
Secondly, the monetary ceiling as brought out by you is for the purpose of recovery towards Pension Fund under EPS-1995 whereas the PF recovery will be @12% or 10% as the case may be on the PF bearing emoluments.
From India, Nagercoil
Secondly, the monetary ceiling as brought out by you is for the purpose of recovery towards Pension Fund under EPS-1995 whereas the PF recovery will be @12% or 10% as the case may be on the PF bearing emoluments.
From India, Nagercoil
Dear All,
The PF Scheme gives you three benefits:
-1- Equal contribution towards PF which you can withdraw later
-2- Employees Pension Scheme which provides you Pension
-3- Insurance in case of death during employment
If these three benefits are matched by employer then it is worthwhile
to recommend and accept proposal by company as HR professional
Regards
Govind
98338 90250
The PF Scheme gives you three benefits:
-1- Equal contribution towards PF which you can withdraw later
-2- Employees Pension Scheme which provides you Pension
-3- Insurance in case of death during employment
If these three benefits are matched by employer then it is worthwhile
to recommend and accept proposal by company as HR professional
Regards
Govind
98338 90250
hi
PF is mandatory for employees coming under the category of workman, who are drawing salary of less than or equal to 6500/-.
for employees whose starting salary has been more than 6500, are not compulsarily covered. however, if employee and employer want,it can be implemented.
those employees, who were earning less than 6500 earlier, but now have moved ahead for salary more than 6500, are to be covered under this act.
thanx
From India, Hyderabad
PF is mandatory for employees coming under the category of workman, who are drawing salary of less than or equal to 6500/-.
for employees whose starting salary has been more than 6500, are not compulsarily covered. however, if employee and employer want,it can be implemented.
those employees, who were earning less than 6500 earlier, but now have moved ahead for salary more than 6500, are to be covered under this act.
thanx
From India, Hyderabad
Hi,
in a very simple language , if your company has 20 employees but out of which 5 employees earn basic more than 6500 then Provident Fund is not applicable to your company ,
for more clarification mail me at
Regards
Chandrakant V.
9820592842
( Provident Fund, ESIC, Contract Labour , MLWF, PT Consultant)
From India, New Delhi
in a very simple language , if your company has 20 employees but out of which 5 employees earn basic more than 6500 then Provident Fund is not applicable to your company ,
for more clarification mail me at
Regards
Chandrakant V.
9820592842
( Provident Fund, ESIC, Contract Labour , MLWF, PT Consultant)
From India, New Delhi
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Compulsory Detailes PF withdrawal Form.xls
HC All - Trainees not covered for PF -2010.pdf