Madhu.T.K
Industrial Relations And Labour Laws
Sumitk.saxena
Service/manager-hr
Ve904
Asm Hr
+3 Others

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Hello all
I have some questions.
  1. Are PF deductions applicable to the candidates who have joined an organisation as Management Trainees and Graduate Engineer Trainees?
  2. If no, then why?
  3. Can an organisation exempt itself from PF regarding Management Trainees and Graduate Engineer Trainees?
  4. Is it possible for an organisation to pay PF (and deduct accordingly) to certain Management Trainees and Graduate Engineer Trainees pertaining to a particular unit/plant of an organisation and not paying to others (i.e. MTs & GETs) posted at other units/plant?
Please throw some light regarding this matter as it is being practised by a PSU.
Thanks
SUMIT

From India, Bhubaneswar
If the management training program is as per the certified standing orders of the establishment, then these trainees will be excluded from EPF. Similarly, if the stipend payable to these management trainees is more than Rs 6500, then also they become excluded from EPF.
Regards,
Madhu.T.K

From India, Kannur
Sir,
The PSU doesnt yet have the Certified Standing Orders.
The stipend is above 6500.
BUT
The MTs and GETs placed at one of the units of the Organisation are being included in EPF whereas all other MTs and GETs posted at other units aren't being included in EPF.
Is that permissible or is it an error on the part of the management?
Regards,

From India, Bhubaneswar
If at all the position of management trainee, falls in the roll grade of an organization, the employee/trainee would be eligible for EPF nad the contribution would be deducted from the salary irrespective of whether the pay is above 6500
From India, Bangalore
If the stipend at the start of training is more than Rs 6500, then there is nothing wrong in excluding them from EPF. The management is not wrong. Regards, Madhu.T.K
From India, Kannur
Dear Sir,
Pl clarify till time our company was following the pattern of 12 % from employee & 12 % from employer,
1. if we want to get exemption for more then 6500 basic salary members then should we deposit the pf of these members on 6500 basic or no need to pay any pf for these employees.
2. what is the procedure to implement this new practice.
Regards
Manoj

From India, Delhi
The Hon'ble Supreme Court in RPF commissioner, Mangalore Vs. Central Arecanut and Coca Marketing and Processing Co. Op. Ltd., Mangalore (2006) LLR 263 held that a Trainee in an Establishment covered under the Industrial Employment (standing Orders) Act will be excluded from the Provident Fund Act.

The Establishments who have already covered trainees appointed uner Standing Orders(Certified or Model) may continue to cover such trainees under the Act until their tenure of training expires.

By this latest decision of the Hon'ble Supreme Court, the issue relting to coverage of trainees under EPF Act has come to a finality. It may be further noted that only trainees appointed under the Apprenticeship Act or under the Standing Orders are excluded from the dfiniition of "Employees" under the Act. Only those trainees who meet the criteria laid down as above are excluded from the applicability of the Act. Those who do not met the criteria as stated above and who have ben branded as trainees for convenience are not excluded. Further, the individual letter of engagement of a Trainee should refer to the scheme and clearly reflect the provisions of the scheme.

Hope this clears the doubt of my HR friends.

G.K.Manjunath,

HR Manager

From India, Bangalore
Dear All, Pls advise that can be set the financial target in appointment letter. Rgds Santosh
From India, New Delhi
With great respect I beg to differ from the opinion given here in above. 6500 is only an upper limit. No where the act says above 6500 the employee is exempted. 6500 is upper limit over and above the same it becomes optional on the hand of employer and employee. Correct me if iam wrong.
From India, Chennai
I have not said that persons with more than 6500 salary is an exempted employee but I have said that he can be an "excluded" employee. There is difference between exempted employee and excluded employee. An employee is excluded from PF coverage when his at the time of joining the company exceeds Rs 6500, or when he joins a company while getting PF pension (PF pension and not any Government, defense or Railway pension) or joins after he has withdrawn his PF accumulations after attaining 50 years of age or if he is an apprentice engaged under the Apprentice Act or under the certified Standing Orders of the company.
Madhu.T.K

From India, Kannur

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