Why Is My Employer's PF Contribution Less Than Mine? Is My Company Cheating Me?

Hi, I just checked my PF balance. I received a message that my EE contribution is Rs. 5121, but the ER contribution is Rs. 1564. As per my knowledge, the employee and employer contributions must be the same. My father is an SBI employee. When I checked his PF statements, his employee and employer contributions were the same. Then why, in my case, is the employer contribution less? Is my company cheating me? If yes, then what should I do?

No, actually, you are right. But there are some rules:

Employee and Employer Contribution Rules

The employee's share, which is deducted from the salary, is 12%. The employer's share, which is paid, is 12% or equal to the employee's share. So, as per deduction, the total share is 24%, but the 24% is divided in the following ratio:

- Employee Provident Fund = (employee 12% + 3.67% of employer share)
- Employee Pension Fund = remaining 8.33% of employer share.

As you know, any employee can get the benefit of the pension amount either by doing the job continuously in any account for more than 9 years or after leaving the job.

When you see your account balance, you are considered a live employee, and the EPF department assumes that you will continue your job for more than 9 years. Thus, you see in the EE share only 12% + 3.67% (the pension amount will not be displayed). However, if you do not complete more than 9 years and you leave the job, claiming your EPF, then you will get 24%.

Note: If the service is less than 6 months, then also you will not be entitled to 24%; you will only get 15.67%.

My EPF balance is EE amount Rs. 26029 and ER amount 8052 as on 16-11-15. I left the job two years back. I have applied for the PF settlement. What could be the final settlement and what is the procedure?

Please let me know if you need further assistance.