Hi Anuradha,
As you know, EPF contribution is directly relevant to 'salary/wages' for those drawing upto Rs.15,000 only and I think there is no impediment administering contribution as 'voluntary' in respect of those drawing above Rs.15,000. By virtue of this decision, if the basic wages for PF purpose exceeds INR 15,000 p.m., are the employers required to contribute on this higher amount? This decision has not dealt with this aspect. Interestingly, in another SC decision in the case of Marathwada Gramin Bank, it was held that employers cannot be compelled to contribute beyond their statutory liability. PF authorities did not file the review petition in that case and issued instructions to their field officers in May 2014 that they should not force employers to contribute over and above the statutory wage ceiling (i.e. Rs.15,000 p.m.). In view of this, employers still have the option to contribute PF on the statutory wage ceiling of Rs.15,000 per month (statutory obligation) unless they voluntarily agree to contribute PF on the wages higher than Rs.15,000 per month. If PF authorities wish employers to contribute on the higher basic wages, they will need to withdraw their previous instructions, but these can then be applied prospectively only. Nevertheless, in view of Marathwada Gramin Bank ruling, the issue may still get challenged in a court of law. For foreign nationals qualifying to be International Workers, the situation is not the same, as the wage ceiling of Rs.15,000 p.m., is not applicable to them, and they are required to contribute PF on the total wage amount even beyond Rs.15k as per law stipulated.
As you know, EPF contribution is directly relevant to 'salary/wages' for those drawing upto Rs.15,000 only and I think there is no impediment administering contribution as 'voluntary' in respect of those drawing above Rs.15,000. By virtue of this decision, if the basic wages for PF purpose exceeds INR 15,000 p.m., are the employers required to contribute on this higher amount? This decision has not dealt with this aspect. Interestingly, in another SC decision in the case of Marathwada Gramin Bank, it was held that employers cannot be compelled to contribute beyond their statutory liability. PF authorities did not file the review petition in that case and issued instructions to their field officers in May 2014 that they should not force employers to contribute over and above the statutory wage ceiling (i.e. Rs.15,000 p.m.). In view of this, employers still have the option to contribute PF on the statutory wage ceiling of Rs.15,000 per month (statutory obligation) unless they voluntarily agree to contribute PF on the wages higher than Rs.15,000 per month. If PF authorities wish employers to contribute on the higher basic wages, they will need to withdraw their previous instructions, but these can then be applied prospectively only. Nevertheless, in view of Marathwada Gramin Bank ruling, the issue may still get challenged in a court of law. For foreign nationals qualifying to be International Workers, the situation is not the same, as the wage ceiling of Rs.15,000 p.m., is not applicable to them, and they are required to contribute PF on the total wage amount even beyond Rs.15k as per law stipulated.
1 Attachment(s) [Login To View]