Is It Fair for Employers to Deduct Their PF Contribution from Your Net Salary?

Hello,

I just have a question and doubt that's been in my mind for a long time. I wanted to know if the employer contribution of PF (i.e., 12% on Basic and DA) should be deducted from the employee's net salary.

As I know, the Employer Contribution would be mentioned in the Gross Salary. However, I am aware of a company that is deducting the Employer contribution of PF from the net salary of an employee without even mentioning the same in the employee's offer letter.

Please do tell me if this practice is correct on the management side or if it is the fault of the HR Department. Also, please let me know the PF Deduction plan.

Regards,
Santosh Barnala

Thank you very much, Mr. Peer Mohammed, for your reply and the valuable information link that you've provided. It was truly informative.

Regards,
Santosh Barnala

Hello,

I have a question that has been on my mind for a long time. I would like to know whether the employer's contribution to PF (i.e., 12% on Basic and DA) should be deducted from the employee's net salary.

As far as I understand, the Employer Contribution should be reflected in the Gross Salary. However, I am aware of a company that deducts the Employer's PF contribution from the employee's net salary without informing the employee in the offer letter.

Please clarify whether this practice is correct from the management's perspective or if it is an error on the part of the HR Department. Additionally, could you please explain the PF Deduction plan?

Regards,
Madhu Jolly