Dear rnpkrp,
The Govt of India has started the PF scheme to provide a social security to the employees of various establishments.The scheme have hosts of benefits including old age pension. My colleague Sh Alphonse has rightly mentioned that if the establishment, where you are working, is covered and registered under the Employees' Provident Funds and Miscellaneous Provisions Act,1952, you have no choice unless you fall in the following exception categories:-
(i) If you are a new employee to your present company drawing a wage/ salary above Rs.6500/-and were not a member of Employees' Provident Funds Scheme earlier or if member, you have drawn your PF accumulations. In such case you will not be enrolled as member of the PF scheme.As per Para 33 of the Employees' Provident Funds Scheme,1952, upon joining a new establishment, you need to give a declaration in Form-2 and furnish information to your employer regarding your earlier company and PF account no., if any. In view of the definition,your basic salary shall be considered for the purpose of deduction of your PF contribution.
Regarding you second query unlike other enactments, the Employees' Provident Funds and Miscellaneous Provisions Act,1952 has defined the "basic wages" instead of wages, which includes all emoluments which are earned by an employee while on duty but does not include (i) cash value of any food concession; (ii) any dearness allowance (iii) house-rent allowance (iv) overtime allowance (v) bonus and (vi) commission or any other similar allowance payable to the employee or (vi) any presents made by the employer.
As regards,you last query, EPFO has forwarded a proposal to increase the salary limit and reduction of coverage threshold of twenty persons to ten to the Ministry of Labour for approval.
BS Kalsi
Member since Aug 2011