Why Has My Company Skipped PF Deductions for Two Years? Urgent Help Needed!

Now, I have joined a HR consultancy as an HR Assistant. Our consultancy has more than 100 employees, but the client's location is different, and I am deployed at the client location. Every employee's basic salary is more than 15,000 rupees. The company doesn't provide any PF deduction to the employees, but they have now planned to provide PF deduction. Can I know why the company has not been providing PF for the last two years? Is it possible to run a company without PF deduction for the last two years? Please help me with the details. It's urgent. Please assist me.

Understanding PF Obligations for Employers

Being an HR Executive, you should know that as per the PF Act, an employer is not under any legal obligation to contribute towards the PF funds if the employees are receiving a salary of more than Rs 15,000. It should also be noted that this limit was just Rs 6,500 until last September. Certainly, the company would be a covered establishment and will have a PF Registration number, but since all the employees are earning a salary of more than Rs 15,000, none has been covered. Please check.

If the company has now decided to give PF coverage to all employees without reference to their basic salary, then it should be taken as a bonus from the employer.

Clarification on PF Coverage in Different Employment Scenarios

I have another doubt. You are on the rolls of a consultancy firm and you are deployed at one of their clients’ premises. Are you talking about the client company or your consultancy firm which has not provided PF? If your consultancy company has not given PF, then it should be due to the above reasons only. There is one more possibility: if you have been deployed in a client company that has no PF registration due to having an employment strength of fewer than 20 employees, then also you will not come under PF coverage because your principal employer is not covered.

Regards,
Madhu.T.K