Understanding PF Act Applicability, Employee Thresholds, and Wage Ceilings

Coverage under PF Act:

The total staff strength of our organization is 22. Out of these, only two persons are drawing Basic + DA of Rs. 6500/- per month, while others are drawing more than Rs. 6500/- per month as Basic + DA.

I would request my seniors to advise me on whether our organization will be required to register under the Provident Fund & Miscellaneous Act, as the number of employees exceeds 20. If we are covered under the PF Act, only two employees will be included for PF contribution, and the rest of the employees are outside the purview of the PF Act since they are drawing more than Rs. 6500/- per month.

Dear Friend,

In response to your query, I wish to state as follows:

The Applicability of the Act:

1) Every establishment which is a factory engaged in any industry specified in Schedule 1 and in which 20 or more persons are employed.

2) Any other establishment employing 20 or more persons which the Central Government may, by notification, specify in this regard.

3) Any establishment employing even fewer than 20 persons can be covered voluntarily under Section 1(4) of the Act.

The above clarification will clear your doubt.

Dear Queriest,

For the applicability of the PF Act to any establishment, the threshold limit of employees is headcounts of all, including contractors' employees, irrespective of any salary limit. Even if you have all 22 employees as "excluded employees" within the meaning of the Act, you are liable for the registration of your company as an establishment under the PF Act and must pay Rs. 5 and Rs. 2 every month towards administrative charges of PF and EDLI, respectively. Please bear in mind that employees drawing a salary of more than Rs. 6500 per month give you the absolute right to exclude them from PF. This topic has been discussed many times earlier in this forum. It is unnecessary to mention here that all the abovementioned limits of the number of employees, salary, minimum administrative charges, etc., are as of now.

I understand that the limit for PF has been raised to Rs. 15,000 now. Can anyone post the circular for guidance, please?

Regards

Mr. Khan,

Please find the attachment on PF circular for the enhanced wage ceiling.

Sir(s),

So far, the so-called notification regarding the enhancement of the wage ceiling under EPF & MP Act, 1952 has not been issued. The circular attached above is only for the internal circulation of EPFO and states that the notification will be issued shortly.

Dear all,

Under the PF Act, is it mandatory to keep "Basic Salary" equivalent to "Minimum Wages"? If yes, please provide the reference number.

Thank you.

Dear Harsh Kumar ji,

Kindly excuse me for my post. Your post dated 19.08.2015, I mistakenly read as today's post. It was my stupidity. Please ignore my post.