Is It Common for Companies to Delay PF Eligibility Until After a Year? Can I Claim It When Resigning?

I am working with an IT company in Hyderabad. My company has implemented a new rule regarding PF eligibility. The rule states that an employee is only eligible for PF after completing one year in the company.

I would like to know if this rule is being followed in all companies. Also, can I claim my PF amount at the time of resignation?

Your help is greatly appreciated.

Regards,
R. Sinha

Your present company is cutting your PF. Are you confirmed about that? You can claim your PF account. When you leave the organization, you can sign the forms and submit them to the HR department; they will follow up with the PF office. The company will hold your form for 60 days, and then they will send it to the PF office. However, in your case, you can check with your firm. This is the procedure.

Regards,
Mathews

The issue is that they have not opened the PF account for any of the employees, but they are deducting the PF amount. In this case, can I claim for PF, or do I have to follow the rules set by them because I have not completed one year in this company?

Guide me...

Regards,
R. Sinha

In my view, your company may be making some mistakes. Firstly, they may not be opening the PF accounts. Secondly, some employees may already have accounts, but they are not receiving payments. There is no specific rule for PF stating that an employee becomes eligible only after one year of service. It seems like they are trying to avoid paying the PF contributions.

My suggestion is that you please approach your HR and address this issue politely. They should be able to assist you and provide clarification. If your PF contributions are being sent to the PF office, ask for an acknowledgment and your PF number. If your HR does not share this information, you can approach your senior colleagues who have completed one year in the organization to inquire about their PF numbers and monthly acknowledgments.

Regards,
Babu. P

My company is a start-up, and I am working as an HR Executive. No one in this company has completed one year, and there is no HR Manager. The company's head is taking care of all the responsibilities. I have talked to him many times regarding the PF account, and he said we will open it later on. At that time, he mentioned that he would return the PF amount, but a few days back, he implemented this new rule.

Is the Rule Made by Him Legal?

What action can I take? Please guide me.

Regards,
R. Sinha

Dear Babu .P, The same case is with the organization where I'm handling the HR Dept. This is a fabric manufacturing company. The PF procedure is not proper over here. PF benefits are not provided to all employees. If any employee wants to avail PF benefits, then the organization deducts both employee and employer contributions from their monthly salary and provides the amount after leaving the organization. Is this practice authentic? Kindly guide...

Thanks & Regards,
Laxmi Parajuli

Do you have any proof that your company is deducting your PF? If not, you should check with the Labour Department. Regarding the PF issue, you can discuss it with the Labour Department where you are handling these activities. You can take action against your company.

Regards,
Mathews

If you have 20 or more employees, then you should obtain the Provident Fund code from the PF authorities. Additionally, failing to deduct PF and not depositing it with the authorities is a criminal offense under Section 405 of the Indian Penal Code, which constitutes a criminal breach of trust. I recommend showing a copy of this section to your employer.

Thank you.

Mr. Malik has addressed the basic issue. First, confirm whether your establishment is employing 20 or more persons to be covered by the P.F. Act.

Regards,
B. Saikumar
HR & Labour Law Advisor
Mumbai

Most organizations think they are cleverer than the EPF Act by framing impractical procedures. EPF eligibility begins as soon as the joining date itself. Without EPF coverage, they cannot deduct in the name of EPF. If this happens, you can file a complaint with the nearby PF Commissioner.

Regards,
V. Subbarao

Dear Seniors, there are around 65 employees in my company. I have proof that they are deducting the PF because I am the person who calculates the salary. They don't provide us with the salary slip either. I talked to them regarding the salary slip, but they are not taking it seriously.

Regards, R. Sinha

Dear Seniors, there are around 65 employees in my company. I have proof that they are deducting the PF as I am responsible for calculating the salary. They don't even provide us with the salary slip.

Regards,
R. Sinha

I completely agree with Mr. Viren and Mr. Babu P. Employees having a basic salary of 6500 or more have the option of whether to opt in or opt out of PF. However, if the organization is deducting the PF, then one can only claim that after they have left the company. As rightly said, the company will withhold the letter for 60 days. If the company is deducting the PF, it has to provide details to the employee; in case the company is not doing so, something seems fishy.

Thanks,
Saloni