Coverage & Withdrawal of PF Accumulation of “International Workers” under the Employees Provident Fund (M&P) Act 1952.
1. Definition – International Worker
An International worker may be an Indian worker or a foreign national. - Any Indian employee working or having worked abroad in a country with which India has entered into a Social Security Agreement (SSA); or - Any foreigner working in India in an establishment where the Employees Provident Funds & Miscellaneous Provisions Act, 1952 is applicable.
(So all expatriates working in India are covered as an International Worker.)
2. Status - Social Security Agreements (SSA)
A Social Security Agreement is a bilateral instrument to protect the social security interests of workers posted in another country. Being a reciprocal arrangement, it generally provides for equality of treatment and avoidance of double coverage.
As of 01.04.2011, three Social Security Agreements in respect of Belgium, Germany, and Switzerland have been made effective from 1st September 2009, 1st October 2009, and 29th January 2011 respectively. Apart from the above, SSAs have already been signed with France, the Netherlands, Czech Republic, Denmark, Hungary, Norway, Luxembourg, and the Republic of Korea, but not yet made effective. Negotiations are at various stages with Canada, Quebec, Sweden, Australia, USA, and Austria. Government-level talks are ongoing with many other countries where sizable numbers of Indian workers are employed.
3. Till the time the treaty is not notified in the official Gazette, most companies shall fall under the category of Non SSA Category. The day the treaty is notified, the International Worker will fall under the category of Excluded Employee (defined below).
{(f) "Excluded Employee" means an International Worker, who is contributing to a Social Security program of his/her country of origin, either as a citizen or resident, with whom India has entered into a Social Security Agreement on a reciprocity basis and enjoying the status of detached worker for the period and terms, as specified in such an agreement.}
For the companies falling under the Non SSA category presently, an International Worker may withdraw the full amount standing to his credit in the Fund only on the below conditions:
(a) On retirement from service in the establishment at any time after the attainment of 58 years;
(b) On retirement on account of permanent and total disability in capacity for work due to bodily or mental infirmity duly certified by the medical officer of the establishment, or where an establishment has no regular medical officer, by a registered medical practitioner designated by the establishment.
HOWEVER
One of the regional websites of EPFO (Uttar Pradesh) has stated - although not a formal agreement, there is a reciprocal arrangement between India and the NON SSA Category countries (who have signed SSA with India and the official Gazette is yet to be released) to settle the claims of the employees on completion of employment in the host country.
Based on the above statement, HR can initiate the PF withdrawal for the employees who have completed the services in India and have repatriated back to their home country. There is no need to strictly adhere to points (a) and (b) as mentioned above. The withdrawal process will be the same as for Indian employees.
Regards,
Kumar Anand
HR - SAMSUNG
1. Definition – International Worker
An International worker may be an Indian worker or a foreign national. - Any Indian employee working or having worked abroad in a country with which India has entered into a Social Security Agreement (SSA); or - Any foreigner working in India in an establishment where the Employees Provident Funds & Miscellaneous Provisions Act, 1952 is applicable.
(So all expatriates working in India are covered as an International Worker.)
2. Status - Social Security Agreements (SSA)
A Social Security Agreement is a bilateral instrument to protect the social security interests of workers posted in another country. Being a reciprocal arrangement, it generally provides for equality of treatment and avoidance of double coverage.
As of 01.04.2011, three Social Security Agreements in respect of Belgium, Germany, and Switzerland have been made effective from 1st September 2009, 1st October 2009, and 29th January 2011 respectively. Apart from the above, SSAs have already been signed with France, the Netherlands, Czech Republic, Denmark, Hungary, Norway, Luxembourg, and the Republic of Korea, but not yet made effective. Negotiations are at various stages with Canada, Quebec, Sweden, Australia, USA, and Austria. Government-level talks are ongoing with many other countries where sizable numbers of Indian workers are employed.
3. Till the time the treaty is not notified in the official Gazette, most companies shall fall under the category of Non SSA Category. The day the treaty is notified, the International Worker will fall under the category of Excluded Employee (defined below).
{(f) "Excluded Employee" means an International Worker, who is contributing to a Social Security program of his/her country of origin, either as a citizen or resident, with whom India has entered into a Social Security Agreement on a reciprocity basis and enjoying the status of detached worker for the period and terms, as specified in such an agreement.}
For the companies falling under the Non SSA category presently, an International Worker may withdraw the full amount standing to his credit in the Fund only on the below conditions:
(a) On retirement from service in the establishment at any time after the attainment of 58 years;
(b) On retirement on account of permanent and total disability in capacity for work due to bodily or mental infirmity duly certified by the medical officer of the establishment, or where an establishment has no regular medical officer, by a registered medical practitioner designated by the establishment.
HOWEVER
One of the regional websites of EPFO (Uttar Pradesh) has stated - although not a formal agreement, there is a reciprocal arrangement between India and the NON SSA Category countries (who have signed SSA with India and the official Gazette is yet to be released) to settle the claims of the employees on completion of employment in the host country.
Based on the above statement, HR can initiate the PF withdrawal for the employees who have completed the services in India and have repatriated back to their home country. There is no need to strictly adhere to points (a) and (b) as mentioned above. The withdrawal process will be the same as for Indian employees.
Regards,
Kumar Anand
HR - SAMSUNG