How Should We Handle PF Settlement for an Ex-Employee Accused of Fraud and Harassment?

Hi All,

Requesting you all to guide me. There was an employee working with us who was then terminated because of some fraud. She then filed a harassment case against the organization. The organization was fined up to Rs. 25,000.

Now, she wants to claim the PF amount. However, she owes a huge amount to our organization. I have recently taken charge as HR Officer. What could be done? Please help me in this regard ASAP.

Regards,
Rashmi

Dear Rashmi,

PF amount cannot be attached against any debt. Please refer to Section 10 of THE EPF AND MP ACT 1952, which will make you clearer.

Thanks,
J.S. Malik

Dear Rashmi,

I can understand your problem. However, the fact is that due to our laws, you cannot stop his or anyone's PF, as Mr. Malik has referred you. It can create more problems for your company if you hesitate to do so.

Regards,
Gunjan

Dear All,

In case of a disputed matter, is it possible that the company will not process the PF? In such cases, is there any enforcement by law in favor of the employee or employer? Would appreciate it if the same could be answered promptly.

Regards,
Ranjeet

Hi Rashmi,

What I understand is that your employee can make an application with the PF Authorities that your company is not releasing her PF amounts, which would further embarrass you and your organization. So maybe you can have a meeting with the employee and initiate a settlement process.

Regards,
Venkat

Hi Rashmi,

As far as your doubt regarding PF settlement is concerned, any employee is not authorized to withdraw his/her PF amount until he/she receives an NOC letter and relieving letter from the company he/she had worked with.

Regards,
jnm

This is not a solution to your problem. I can understand from your post that if an employee has committed fraud, they shall pay the damages. You can ask the employee either to pay the damages or face a police case.

Badlu

While sending the monthly return form 10, you have the option to mention any employee whose money has to be blocked. Just go through the form, and if you have given it like that while submitting the return, she can't claim. If it is not so, she can claim, as far as I know.

You have the option in Form 10 while submitting monthly returns. You have the option to mention in it if there is an employee who did malpractice. You can mention in it so that they can't withdraw the amount if you mentioned it like that. They can't claim, as far as I know.

If the PF is managed by the RPFO, the employee can even get his withdrawal forms certified by the Branch Manager of a bank, Gazetted officer, MLA, or MP and can withdraw the PF.

Hi all,

The PF amount cannot be attached under any circumstances, even if an employee has committed fraud within the organization. Form 10 is only required when an employee leaves the organization, indicating the date of termination or the reason for departure.

Best Regards

Dear Mr. Prashant,

It has been rightly said, do not confuse without knowing the law. If someone has committed fraud, file a criminal case through the police, and a recovery case can be filed directly in court. Provident fund money cannot be attached. Form 10 is just to give information about leaving the organization.

Thank you,
J. S. Malik

Dear Rashmi,

The situation is a complicated one. Few things are not clear. What action did your organization take for the fraud committed by her? How was she able to win the harassment case against the organization? I am not sure how strong your legal team is or how good the evidence you have against her.

Leaving this aside, as a few seniors have pointed out, PF can't be attached. Even if you are not forwarding the PF withdrawal form, she can submit it through other authorized persons.

If you have good evidence, you can file a police complaint and proceed against her. If not, then try to settle with her. She should not get the impression that the organization is weak and unable to fight against her.

Act with patience and a lot of caution.

Regards,
Bhavan