PROFESSIONALS AND BUSINESSES PARTICIPATING IN DISCUSSION
Partner - Risk Management
Use factoHR and automate your HR processes
Mobile-first hire to retire HR and Payroll software that automates all HR operations and works as a catalysts for your organisational growth.
rkn61What your labour consultant apprised you in the matterof PF pension and minimum period of years as PF members, is perfectly correct.
So please inform your employees, and convince them about the need to continue their PF membership, in order to attain the eligibility, for availing PF pension.
From India, Aizawl
srivatsa-chamariaThey want to resign so that their pension fund contributions can be withdrawn, if they complete 9 yrs 6 months of service, they won't be able to withdraw their pension fund..
My question is whether I should permit them to resign before they complete 9 yrs and 6 months or just before they complete 10 years?
From India, Bengaluru
saswatabanerjeeI think you are being deliberately vague to avoid stating the reality.
It is not that they want to resign (they are not planning to leave)
they want to resign, withdraw the entire PF amount and then make a fresh PF account.
So I assume they want you to continue paying them for the period till they can claim their PF?
How will you pay them? If you pay them a salary, you are in violation of PF laws. If you pay them as consultants / contractors, at the same or similar level and following the same set of employment terms, then also you are violating the law and it can result in you being liable for penalty, interest and PF contribution for the period as well as prosecution for fraud.
Inform the employees that to be able to withdraw the pension contribution, they have to close their PF account, which means they need to withdraw the entire money, not just the pension contribution. So they will no longer earn interest, which is the best possible rate they can get in India for a safe saving.
Further, they would need to be unemployed for the period from their resignation till the time they get the full money in their account and the PF department marks the existing UAN as closed.
From India, Mumbai