Hello Sir/ Mam. i joined 1 newly set up company. In my salary they are deducting PF. recently i got to know they dont have PF Number. so its legal to cut PF from salary or not. Regards Deepika Vijay
From India, Delhi
There are 2 questions here :
1. How many people are working there
2. Are they legally liable for PF
If they are liable for PF and have applied or are in the process of applying for PF number, then they can deduct from your salary.
If they are not liable or have not started the process of applying for a PF number, then this is illigal

From India, Mumbai
Dear Deepika ji,
While endorsing Saswataji, I would like to add as under:
If your company is not been allotted PF code by the department, the company can not make deduction towards PF. If it is deducted then it is unauthorized deduction for which the company is liable.
Section 7(2) of POW Act says that deduction from wages shall be made only in accordance with the provisions of this Act and may be of kinds only as listed thereunder.
I have experienced a case in which the company effected deduction towards PF contribution and kept it aside till such time PF code number is not allotted by the department. The company made an application for allotment of code immediately after deduction is effected. When the inspector visited the company on receipt of the said application found the deduction effected. He immediately filed a complained for misappropriation of money. I need not to mention here the repercussion of this complaint.†
Hope that the proper massage is given to all.

From India, Mumbai
I agree with Keshav Korgaonkar that deduction of EPF by the employer without having EPF code is illegal and an offence.
From India, Pune
Thanks Sir for the responses.
i was discussing this matter with HR also. he is saying its under process and only inception is left for verification and company got the authority from PF dept to Deduct the PF from the salary and they will get PF number after all verification and paper work.

From India, Delhi
Sorry, I disagree
Once a company has filed an application for a PF number, they can deduct the amount from salary. It takes 3-4 months to get your of number. In that case the employer will be required to deduct 100% of the next month salaryntompay PF which does not make sense. Also if a person leaves in the meanwhile, what happens ? The employer is still required to pay the PF. Why should he pay out of his pocket ?
Once the number is allotted, he must pay the entire money that was collected. This is not an offence.

From India, Mumbai

It is undoubtedly illegal to deduct PF amount without authorisation by the department and the verbal authorisation is no authorisation. The company needs a PF number through which it can deposit the amount of PF deductions from the salary of her employees. But you should also keep it in mind that you can not afford to destabilise your relations with your company on small matters. You alone should not contest it. You should discuss this matter with your colleagues and then represent to the company on collective basis so that you may get the desired results. The amount of PF is not so big that you can dare to fight with your company all alone.

Moreover, if the number of employees in the company is 20 or more, the company is required statutorily to take PF number and to deduct the PF and to deposit it regularly. If the number of employees are less than 20, then it is a total fraud and you should take up the matter immediately. The company is not applying and taking the PF number and mis-utilising/rather cheating with the PF fund.

Mahavir Mittal

From India, New Delhi
I agree with Saswatabanergee. We have started company in Dec 2011. From pay roll of Dec 2011 we have deducted PF. We applied for PF ( Effective from Dec 2011 ) in January 2012. PF Authority carried out inspection for coverage & allotted the code No. In the month of March 2012. After allocation of PF code we have deposited the contribution.
We have to apply for PF coverage in the very next month of pay roll. This shows that we do not have purpose to avoid the PF rules & the delay in remittance of contribution can be justified.
S D Patil

From India, Kolhapur
Dear Deepika Vijay,
greetings for the day,
If the company have no EPF code no deduction of EPF from the employee salary can be done, if the company is managing his own EPF trust then its ok.
Thanks & Regards,
Sumit Kumar saxena

From India, Ghaziabad
As per provisions under the Act, any estt. Falling under purview of the Act ,must comply from the date of coming under the purview of the Act, without waiting for the allotment of code number so as to avoid penal damages as well as interst on belated remittances .in case ,the deductions are not made, employer will have to deposit both the shares from his own account.
Thus, in my view ,the employer has taken the right step to deduct PF contributions but must deposit the same every month by due date , without waiting for the coverage letter fron the o/o RPFC.
Chandok AK
RPFC (Retd.)

From India, Chandigarh

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