EPFO's New Rule on Basic Wages: How Does It Affect Your PF Contributions?

EPFO Notification on Basic Wages

As per the recent notification from the EPFO, splitting of basic wages is not allowed. The notification is attached for reference.

Regards,
Manjeet Singh

Dear Friends, The circular issued by EPFO about not allowing employers to bifurcate minimum wages against the judgment of P & H HC has been strongly opposed by employers. Representations have been sent to EPFO requesting the withdrawal or amendment of the circular.

It is important to note that the circular represents an interpretation of the law and not a final verdict. No circular or order from any Government Department will supersede the High Court judgment, at least in the states of Punjab and Haryana, until the judgment is either overruled or set aside by the Supreme Court.

Regards,
Anil Kaushik

Let us consider it as information for the people who are splitting the minimum wages to reduce the amount towards PF contribution and stop such practices hereafter. Thanks to Manjeet for sharing the notification.

Regards,
Gopal

Contrary to this, in Delhi, the minimum wage has now surpassed the threshold of Rs. 6500, which is the threshold for paying PF contributions.

Seeking Comments from Seniors

How can this be resolved? I am seeking comments from seniors on this matter.

Regards

Does this mean that the basic salary, in any case, cannot be less than the minimum wages as decided by the government?

Regards,
Rajendra Jadhav.

PF Contribution Details Attached

I have attached the PF contribution details for your kind information.

Regards,
Kamal
[Phone Number Removed For Privacy Reasons]

Can you explain: what is the PF contribution for a non-functional establishment.

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The PF contribution for a non-functional establishment refers to the amount that needs to be contributed towards the Employees' Provident Fund (EPF) by a company that is not operational or functional. It is important for companies, even those not currently in operation, to fulfill their PF obligations as per the regulations set by the government. The PF contribution for such establishments is usually calculated based on the basic salary and dearness allowance of the employees. Compliance with PF regulations is essential for all types of establishments, whether functional or non-functional, to ensure the financial security of employees in the long run.