Asso.prof.(commerce & Management)

Cite.Co is a repository of information and resources created by industry seniors and experts sharing their real world insights. Join Network
Dear HR,
For implementation of recent amemdments in PF Contribututions as per Ho'ble Superme Court Rulings, do the employer has rights to maintain same CTC (by reducing one of the allowance) while deducting employees contribution and depositing equal contribution in employee's PF account as per ceiling of Rs.15000 (on Gross - HRA amount).
Rakesh Shinde

Hi RakeshS,
As far as I know, any restructuring, mainly, especially with a view to limit or reduce the contribution to EPF a/c not acceptable legally/logically. It's upto you to come out clean whatever restructuring you do not aimed at purposely to negate the implications of the recent judgment of SC. But in case of those drawing >15k there is no impediment like this.

Hi RakeshS,
Pl.note the following provisions extract from the EPFMP Act -
[12. Employer not to reduce wages, etc.-
No employer in relation to 4 [ an establishment] to which any 5 [ Scheme or the Insurance Scheme] applies shall, by reason only of his liability for the payment of any contribution to 6 [the Fund or the Insurance Fund] or any charges under this Act or the 5 [Scheme or the Insurance Scheme] reduce whether directly or indirectly, the wages of any employee to whom the 5 [Scheme or the Insurance Scheme] applies or the total quantum of benefits in the nature of old age pension, gratuity 7 [,provident fund or life insurance] to which the employee is entitled under the terms of his employment, express or implied.]

Please Login To Add Reply

About Us Advertise Contact Us
Privacy Policy Disclaimer Terms Of Service

All rights reserved @ 2020 Cite.Co™