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Hello Experts, Through acquiantances I have come across a company that has done the following contraventions:

1)During the FY 2017-18 they have recruited around 15 employees and in their appointment letter mentioned that the EPF will be deducted at 12% of Basic subject to maximum basic being considered as 15K.

2)All the employees who joined had a Basic salary of more than 15K.

3)The company deducted the PF amount but never deposited the company share or the employee share with EPFO.

Now they have received notices under 7A.

I am aware of the damages that they need to pay under 14Q and 7A.In addition to that I understand there is a penalty also to be paid.

But the company is in a bad state now and has no money to pay any of the outstanding dues.

My query is

1) What recourse can the company take.

2) If all the employees are made external independent consultants(not contract labor) then can the company claim that there was no need to pay EPF contribution.

3) What recourse have the individuals have whose EPF has been deducted and not been paid. I understand all of them have resigned from their services in 2019.

4) If the company fails to pay the amount due what punitive action will be taken by EPFO against the company and against whom within the company. And what is the time frame in which EPFO initiates action after delivering the 7A notice.

Please share your valuable insights into this situation.

From India, Mumbai
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