How To Start A PF For An Employee Working For More Than An Year ?

Dear All,
I have a query and need your suggestion. The query is as follows-
A person joins in our co. on 01.04.10 at a Basic of Rs. 10000/- and as he is not entitled to PF as his basic is above Rs. 6500/- at the time of joining. After 1 year of service in the company as on 01.04.11 his Basic is increased to Rs. 12000/- and now as he has completed 1 year now co. wants to give him PF benefit. My question is can a company extend such benefit to a person after 1 year of service in the company or any other point of time after joining? Plz discuss.
Rgds..
DG

Hi,
As per EPF condition when a person join in a organization and work, from first day of his employment, This is the sole responsibility of the employer have to deducts EPF amount from his salary and contribute to EPF commissioner office but restricted on 6500 (basic salary).
in your case after one year, you are planning deduct the amount from his basic and contribute to EPF commissioner office. this is not possible after one year.

There is no problem if you make a resolution that all employees irrespective of their salary would be brought under EPF coverage. The effect of such coverage can take place from the present date and not necessarily from the date of joining of each employee. And it is not possible to take it retrospectively since it would bring about a huge amount as liability towards past PF contributions.
Regards,
Madhu.T.K

Mr. Madhu, you are right
but huge amount of past E. P. F liability will be impose on Employer with current land interest and also you will face legal problem on this Like You have to show all past data related to employment, and this could not be possible to manipulate past year records,
For Example. Salary Records, Attendance records, Leave records, Employment register and many more.
So it’s better to calm and use policy on new comer rather existing one and yes take the declaration form duly sign by them regarding their unwillingness on EPF contribution.

I do agree with Mr. Vikas Sharma but 6500 basic is not the limit of PF deduction. Its a ceiling limit i.e. the pension fund should be calculated on Rs. 6500/-(max Rs. 541/- will go to pension fund) and the difference should go for PF fund. (Employer's cont)
As per as the PF deduction is concerned, from day first, PF has to be conributed for all except Apprentices who covered under Apprentice Act.
Regards,
Dinesh Adikane

It is not necessary that it should be restricted to NEW EMPLOYEES but you can make it applicable to existing employees also BUT WITH EFFECT FROM A PRESENT DATE.
Regards,
Madhu.T.K

HI Madhu,
This is possible if company give new joining date,effect from may 2011 to existing employee but in this case there Gratuity period will affect.
so this is not possible at all.

There is no problem to give him pf benefit, but you will have to show his DOJ from May'11 and restrict his contribution on 6500/- (780/-).
Sanjeev

Kindly don't get confused on this issue.
What Mr. Madhu has written, is correct.
Indian Labour Laws are benevolent in nature, and generally there are no restrictions/ceiling on benefits; they can be better than what is stipulated by Law.
Warm regards.

Thanks for your response. I also think that Mr. Madhu is correct. For this case PF applicability is voluntary and so can be started of at any later date mutually agreed by both employer and employee. But I want to confirm on one point that whether such issue can be handled on case to case basis or else we need to make it applicable for all the employees who are out of the celling!!
Regards
DG