Dear Experts: greetings!!! Needs your valuable suggestion on below.
1) my friend is working in an imported coal trading MNC. He has got an offer from a an organisation which is not an MNC also does not contribute anything towards PF and Gratuity. But the company is offering him 90 % hike. Should he accept this offer or not..?plz advise.
2) if he accepts this offer, will it affects his career in anyway?
3) also suggest, if in future if he look for a change in MNC again, will he be able to get better hike?
Awaiting for your valuable suggestion. Plz advise.

From India, Bangalore
Dinesh Divekar
Business Mentor, Consultant And Trainer
Kanika Kapoor
Soft And Behavioural Skills Trainer
Executive Hr
Korgaonkar K A
Cite Contribution
Community Manager
Career Management, Talent & Capability

Cite Contribution

Why is the firm offering your friend 90% hike? Is your friend's pay, way below the market standards ? Or would his joining the firm earn profits by that multiples?
Please ask your friend to have the reason for change remain crystal clear to him. If he wants to switch for money, he needs to understand if he would be given a similar hike, when he switches next ?
In case he is switching for the role, how job ready would that role make him, in case he needs to switch again and when ?
Finally how good is the brand that he is joining? What are the feedbacks about them by their ex-employees?
A firm's culture is more important than what it pays. Please ask your friend to weigh that well with facts and data.
We wish him/her all the very best!

From India, Mumbai

How can a company registered in India violate statutory requirements of PF & Gratuity if they cross the threshold limit? what is their strength of employees in Indian soil? Pon
From India, Lucknow
Dear Ms. Nobita,
Thank you so much for your reply.
would appreciate if you can guide further with the below details..
in continuation to my last post, i would like to share few more details. so that it will be easy for you to suggest.
my friend has spent 5 years in one organisation,so he is looking for a change for better prospects. the company has offered him a similar job profile but with a better pay & one step senior designation. the company is only one year old in imported coal trading but their group holds a good name in the they are new in market they are targeting all competitors resources with the better pay. but they don't contribute anything towards PF and Gratuity. as the designation & pay is good and also getting the same profile should he proceed further..or he should wait for some other company..? also what if he looks for change after 2-3 years back to MNC will he able to get a similar percentage hike..? plz advise

From India, Bangalore

There are many companies who are violating the statutory norms. No salary as per MW Rates. No PF, No ESI. Law enforcing authorities are concern with GANDHI BAPU. JAI HO!!!
From India, Mumbai
korgaonkar k a

Dear Jei2013shree,
I would like to quote two points here.
1. Provident Fund, the company may be treating your friend as an "excluded employee" within the meaning under the EPF&MP Act. This option is with the employee but fortunate part, many companies do not follow it.
2. Gratuity, there is no contribution by employee. It is the liability of employer to pay Gratuity as per the POG Act. If your friend does not get Gratuity on leaving the company after completion of 5 years, he has legal remedy to get it.

From India, Mumbai

Word of Caution to your friend...

Remember, higher pay means deliverable and expectations will also be higher... Therefore the pressure to perform and achieve will be much higher than his current organization.

PF is not compulsory if the Basic is more than 6500/-. That is the reason why you have PPF. Your friend must ensure that he puts the PF equivalent in PPF so that he could get the same benefit later on.

Coal trading in itself is a very small industry so the chances are that every one in the industry know everyone else... His chances of getting into a so called MNC at a later date would purely depend on how he is able to perform and how much he is visible in the market place.

Just remember... If you need to get good opportunities come your way, you must always be visible in your marketplace. Invisible professionals just remain that way...

I dont think its a bad move at all but then i am not an expert in the coal trading industry and that's where your friends experience and exposure will help in deciding... All the best!

From India, Delhi
Dinesh Divekar

Dear jei2013shree,

Learned members have given excellent views. Nothing is there to say much. However, I recommend your friend investigating as to why company is not providing him PF facility? Violating statutory law is this norm or isolation for your friend?

If company is violating labour law then your friend should be cautious as this speaks of psychology of the owners. PF apart, they could be violating other labour laws or tax laws.

By the way what about working hours? When there is 90% pay hike, is there 90% hike in number of working hours? After all for a business leader if PF contribution does not matter then why working hours will matter for him?

Lastly, as (Cite Contribution) has written, culture of the company also matters. In the companies of this kind, it goes without saying that it is owner driven culture. For our professional growth, we need to work under proper business leader and not some steamroller. For the sake of money, let your friend not ignore this factor.


Dinesh Divekar

From India, Bangalore
kanika kapoor

Hi Jeyashree,
PF, ESI, Gratuity and Medical. These are the four statutory benefits to be provided to an employee by an organization. But for all that the organization should have atleast 25 employees on rolls (outsourced will not count).
So if you say that the company is new and is looking for an experienced professional (5 years in case of your friend) and is ready to give growth too; I guess the only thing u should check is the culture.
-check on linked in (employees and profiles)
-facebook (company profile)
-talk to already working employees
Always remember..opportunity does not knock twice.
If the company has given a proper offer letter and appointment letter and if the HR gives you a logical reason that y they are not giving PF and all then plz go ahead and join.
Hope it helps
All the best!!

From India, Delhi
Dear Ms. Kanika,
Thank you so much for your valuable suggestion. After sharing your post with my friend, it really made him to re-think about the offer and as per your guidance he has also started his research about the company profile and the employees associated.
Thank you again

From India, Bangalore

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