How to Calculate PF Deduction for an Employee Absent for 2 Days in a 30-Day Month?

Dear Respected All,

Please let me know if an employee has a basic salary of 20000 and as per the PF Act, the ceiling is 15000. My question is, if in a particular month of 30 days, the employee was absent for 2 days, then what will be the calculation to deduct PF? If I take the basic as 20000/30*28=18666.66, then what should the PF deduction be, 1800 or 15000/30*28=14000, resulting in a PF deduction of 1680? So, which calculation should I use?

I hope you understand my question.

Regards,
Bharat

Under the "no work, no pay" or Loss of Pay (LOP) policy, the calculation would be based on $14,000, resulting in $1,680, and the Non-Compensatory Pay (NCP) days would total 2.

Since the earned Basic i.e., Rs. 18,666 is greater than Rs. 15,000, then you need to consider the ceiling limit of Rs. 15,000 as PF Wages, and PF deduction will be Rs. 1800.

As the absence is declared, the calculation would go for 28 days instead of 30, and 2 days of NCP (non-contributory period) would be reflected in ECR.

Please let me know if you need further assistance.

Dear Sharma Ji,

Noted, but my question is, what will be the PF contribution (Employee Account @ 12%) - as 1800 or 1680? My main focus is that.

Regards,
Bharat Sukhwal

1800 is for a full 30 days or 31 days. If 2 days of NCP are counted, then obviously it will be 1680.

Dear Mr. Bharat,

The EPF is related to wages earned (amount). If a member is earning more than 15K, the maximum PF deduction will be 15K, i.e., Rs 1800.

Dear All,

Please clarify whether the PF contribution should be calculated on a 26-day basis or a calendar month basis.

Regards,
Amit

PF is to be calculated on PF wages actually paid and not payable.

Dear Mr. Amit,

PF should be calculated for monthly earning members based on the days worked in the wage month.

If a member is on a daily wage system, the calculation should be based on the actual working days, excluding holidays in the month.

Thanks,
Vidyadhar Bhat

Dear Vidyadhar Bhat sir,

I want to know, assuming an employee's salary is 9000 PM, however, he was absent for two days (LOP). Please clarify how we will calculate the salary for the two days of LOP in PF, whether it is 9000/30*2 or 9000/26*2.

Regards,
Amit

Dear Amit,

As a member on a monthly salary basis, it should be calculated as follows: 9000 / Month days (30/31/28) * (-Absent days).

For Nov 16, it would be 9000 / 30 * 28 = 8400 wages for Nov 16, subject to a maximum of 15000. If the salary is 16000, then - 16000 / 30 * 28 = 14933.

I hope this is clear.

Thanks,
Vidyadhar Bhat

Dear Bhat Sir,

Please explain what will be the calculation of the PF contribution with a basic salary of INR 16,000 and with 2 NCP days.

Regards,
Bharat Sukhwal

Dear Bharat,

If a member's basic pay is Rs. 16,000/- and they have 2 NCP days, PF will be deducted on wages earned amounting to Rs. 14,933/- as explained above.

Thanks,
Vidyadhar Bhat

Please provide the PF Notification as per your calculation. Since the earned Basic, i.e., Rs. 18,666, is greater than Rs. 15,000, you need to consider the ceiling limit of Rs. 15,000 as PF Wages, and the PF deduction will be Rs. 1800.