EPF Coverage Of Daily Rate Employees And Their Ceiling Limit

Dear Seniors..

Greetings.......

We having the epf hearing on next week. just i want to know your opinion on the following circumstances.

As per epf act those who are drawing more than 6500 basic pay from the date of joining may exempted from epf with both employer and employee discretion.

we are a interior decorators.. maximum of our contract employees basic pay is more than 6500/- from their date of joing itself.. so have not deduct pf for those people...

but.. to complie labour inspector veiw.. are convert the monthly rate to daily rate and we are showing the daily rate in prescibed colunm in wages register as per contract labour act..

The EPF Enforcement Officer is putting is comment as.. "when you showing daily rate, the employee is covered under pf.. even though his monthly basic pay is more than 6500.. when you are multiply by 26 or 30..."

In the appointment order we have shown as monthly wages only.

Hence, i request your good self to put your valuable comment on this case....

your earlier reply in this regard will highly be appreciated..

regards
raaghav

Firstly, your contract labour's PF liability shall be shifted to the contractor with whom only you have legal relationship. Being a Principal employer your responsibility is only to ensure that the employees engaged by the contractor have been covered by EPF and the contractor has remitted the contributions due in respect of them.

In your case I understand that your contract is sham and is just for name sake. If you have given them "appointment orders" that itself is a proof to show that you have direct control over the employees.

Secondly, if the daily rated employees are given salary for the days of off, then it should become 30 days and perhaps their monthly salary may exceed Rs 6500. If so, you can exclude them from EPF. On the other hand, if it is strictly daily rate and the sum of it comes less than Rs 6500, there is no question of them excluding from PF. In this circumstance, it would be safer for you to say that they are directly employed (as the appointment orders say so) and avoid showing the other record (I don't know what register it is) being maintained for the Labour Officer, the authority under the Contract Labour. Review the matter of contract and get back.

Regards,

Madhu.T.K

What I understand is that those who are drawing more than Rs. 6500/- per month are also eligible for EPF, but the ceiling is Rs. 6500/- per month. Contractor's responsibility is only to that extent? Pl. clarify. Samba

As per our company report about these employees, the thing is, Since they are daily rate workers and they surely not work for all the days in the month.. their average working days is 17 days in a month. So in the wage register of all the month their basic salary will be less than 6500. but as per their appointment order their basic salary is more than 6500.
In veiw of the above circumstances, the pf authority is putting comment. as "you are liable to pay for these wages too."
pls comment on this
regards
raaghav

my petrol pump firm limit 17 employees .pf officer give me showcase for epf coverage what i can do