PF Contribution On Basic Salary - What Is The Rule Says

Regarding the payment of the PF contribution on the allowance. Madras High court and Madras High court have given judgement that,except HRA all the other allowances shall be treated as part of Basic pay and shall be deducted PF. Review petitions are filed in the Supreme Cout. At present, these case are pending in the Supreme Court.
Hence, the SC decides the case we need not to pay the PF on the allowances. If any PF inspection authorities ask to pay on allowance. U can cite these judgement pending in the Supreme Court.
T. Mahendar Reddy

As far as the Basic Pay is reasonable percentage to the total salary, PF authorities cannot insist, because there is no specific mention in the Act or in PF circular about the percentage.
T.Mahendar Reddy

Respected All,
I have a query regarding Welfare Officer(As per AP Factories Act) Revised salary structure copy if any available pl send its very urgent

Hello All,
I have newly joined in one of the organization where we pay on consolidated scale to our employee. I want to reconfirm about my understanding on change in PF celing wage of 15000/- per month.
For a gross of 12000 per month we have the following structure :
Basic : 7800, HRA: 1800, CLA:1200, TA:1200. We are currently deducting pf of amount 936 (7800*12%)
Whereas to meet the PF celing wage requirement i am suggesting to make following structure to meet the requirement.
Basic : 12000 so that PF will be 1440 (12%*12000). Pl confirm is this correct.
The said proposal was in discussion with my PF consultant.

Hello dear all
Whatever component of wage/salary you keep, the PF deduction cannot be on less than the amount of prevailing minimum wages as fixed by the appropriate government. Here is a circular of the PF department.
Jacob Pratap
Deputy Labour Commissioner, Punjab (Retired)
Consultant (Labour Laws) &
Qualified External Member of ICC for Sexual Harassment........ Act, 2013

Is there any minimum limit of Basic salary of PF contribution?I mean Suppose an employee is getting Rs.1500 as basic salary,is he eligible to be deducted for PF???

ONE EMPLOYEE GETTING A CONSOLIDATED PAY OF Rs. 15250/- WITHOUT ANY BASIC & D.A IN AN ORGANISATION.
NOW THE ORGANISATION ESCAPE TO DEDUCT & CONTRIBUTE PF ON THIS WAGE AS THE WAGE IS ABOVE 15000/-. IS IT RIGHT AS PER RULE ?

Dear Jacop Pratap,
Agree, Circular is attached by you is older, Here, I am attaching circular which clearly states that the circular dated:23/05/2011 Splitting Minimum wages for the purpose of PF contribution not permissible KEPT IN ABEYANCE.
Circular attached is dated 02/12/2011 Which says that above circular dated :23/05/2011 is KEPT IN ABEYANCE.
If I am wrong somewhere please advise.
Nilesh Dhameliya
Manager HR

Hi
At the outset, the question whether the employer can split the minimum wages and whether pf contribution is payable on all allowances excluding HRA is yet to be decided by the Hon'ble Supreme Court.
Please refer to the attached note on the above issue.
The pending cases on the subject issue will come up for hearing during this month
You are liable to deduct PF contribution on the basis of current wage ceiling of Rs.15,000/- (Either Basic or Basic + DA as case may be)
Your query Suppose an employee is getting Rs.1500 as basic salary,is he eligible to be deducted for PF - YES
Regards
P.S.Lakshmanan
S. G. Management Services
(PAN INDIA Consultant – Labour Law Compliance,
PF, ESI, P Tax, Benefit Management &
POSH COMPLIANCE) - KOLKATA

HI Everyone!
We are planning to restructure the salary.
If employee cross gross 15000,Can his basic should be 15000 or it can be split into other components and deducted only for 15000 for pf?
Plz clear my query.
Regards,
Lalitha