Dear All,

This incident happened in our organization during March 2014. One employee, who was working with us from past 4 & 1/2 years, submitted a resignation letter. At the bottom of his letter he specially mentioned that he is submitting this resignation only for the purpose of withdrawing his Provident Fund amount. He had a perception that organization will accept his resignation with the same purpose, take his name of the company payroll for 3 months, and release his PF after 3 months from the date of resignation. And then again the organization will re-instigate him in the payroll with a new appointment letter and a new PF account, eventually.

Being an HR, I was the first person to answer him and as per my knowledge I told him that this is not the process. PF amount can be only be claimed and withdrawn only when a person retires or resigns from a particular organization. Further in some cases, I have read that particular % of PF amount can be withdrawn in case of employee's daughter's wedding.

Hence, I request you all to guide me in this and let me know whether the PF can be withdrawn by submitting such type of (temporary) resignation.

From India, Ahmadabad
This is not a new thing.employees have been practicing such thing for withdrawing their of amount when the need arises.probably this is due to the fact that people find it difficult to withdraw loan from of or other sources.however employer is expected guide their employees and help them in granting easy welfare resources so that they do not opt resignation for the want of lump sum money from of providential fund or other such resources.
From India, Vadodara
Not a solution for getting money. Not to be encouraged. It is un-professional on the part of any organisation to allow this knowingly. seshadri
From India, New Delhi
Dear Harshavardhan
Please guide your employee that PF can be withdrawan not only for the purpose of duagther's wedding but for many other rasons as well. File attahced here contains those details . If they resign like this they may lose benifit pertaining to gratuity .

From India, Mumbai

Attached Files
File Type: pdf Instructions_Form31 advnace from PF.pdf (353.2 KB, 3886 views)

Dear Mr.Date, This practice is prevalent. However, kindly check — there are number of reasons for which advance may be taken.Advance is only % of own contribution. Regards, Col.Rathi
From India, Delhi
Dear all,
It is true that few workers opt to withdraw their EPF accumulations as and when they feel any financial crisis which should be avoided by educating them and also extending possible financial aids.
In fact the purpose of EPF remains un -achieved if it is withdrawn before when it is required at old age and such workers are also deprived from long term benefits like gratuity on account of well established breaks in service.
PK Sharma

From India, Delhi
Dear Harsha,
First of all is't that easy to exit and rejoin at their convenience in your office ? I'm surprised.
Secondly, a 'conditional resignation is not acceptable' in normal circumstances.
Thirdly, from March'14 till todate, what was the action taken by your co.on this resignation? Is this still in abeyance ? On the contrary, if your co. already accepted the resignation and relieved him, have you settled his PF? Have you reinstated him back on your rolls ?
I feel this option exercised by your colleague is an ill advised solution to his financial problems. As others pointed out he should have used the option of 'part final withdrawal' without quitting and closing his PF a/c. Now, I afraid, In the process he would have lost the substantial amount of gratuity (equivalent to 2 1/2 months salary) which he otherwise would have become eligible once he completes 5 yrs. of continuous service.
Sorry to see this hasty action.

From India, Bangalore
Dear Harshavardhan,
It is regretful to mention that PF amount and account is used as bank FD by employees.Once they know that particular amount is accumulated in their PF account they will be restless till they do not withdraw the same. In industry unprofessional employers encourage this practices so as to avoid liabilities under gratuity act, retrenchment compensation. Because if employee resigns from service before completion of 5 years or 1 year as case may be employer get relief from above liabilities.There are certain occasions like wedding of childrens, House purchase, LIC premium payments, Medical expenses under which pf beneficiary can claim withdrawal. But minimum 05 years membership under pf is must.

From India, Mumbai
Dear Gauri,
Your suggestion for get advance from PF department for daughter's marriage. He should have to seven years service in pf eligibility.
otherwise he has no chance to get a advance payment for daughter's marriage.
Yogesh Setia
( Sr. HR Executive)

From India, Delhi
Dear Harsh ,
It is totally unprofessional think , But , Form 31 is only applicable after 5 year of employment only for 1 case : purchase and construction of land
and after 7 year of his/her employment he can withdraw 50 % amount for medical treatment and daughter's marriage .
But If your employees having very good track record and having very serious condition for that he need money on that case . Only on behalf Internal Employee orientation program with senior management approval you can do it .
Or if your company having any Advance salary policy you can suggest for that also .

From India, Delhi

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