PF Covered And PF Exempted Employees In Same Company

Hi,

Can an organization have some employees covered under PF and some employees excluded from PF? The employees on the rolls of the company when the company was registered under PF are covered under PF, and the new employees the company has employed who are being paid above 6500 basic have been excluded from PF. Is this allowed and correct, or will this lead to a dispute with the department?

Thank you.

Dear Sanjay,

If at the time the scheme became applicable to your establishment, the referred employees were earning a basic salary exceeding the prescribed amount at that point in time and were therefore excluded, they can continue to be excluded. However, if they were members once and their basic salary has increased over a period of time, they cannot be excluded.

Regards,
Shailesh Parikh
Vadodara, Gujarat
99 98 97 10 65

It is very well possible.

If a new employee joins with more than 6500 basic, he can be excluded.

As rightly said by Shailesh, if an employee is covered before, he needs to be continued to be covered even after his basic exceeds 6500/-. However, his PF contribution can be capped at 6500/-.

I may add further that if an employee, though receiving more than 6500, but was a member of EPF in his earlier employment, will remain a member of EPF in the new establishment as well.

Chandok AK
RPFC (Retd.)
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