Can an Employee with a Basic Salary Over Rs. 15,000 Opt Out of PF in a New Job? Urgent Guidance Needed

Hi, we have one employee. She worked in 2022, and her PF was being deducted in her previous organization. Now she has joined our company, and her basic salary is above Rs. 15,000. Can she opt out of PF? If yes, then which form should be filled? Please guide. It's urgent.

Hi, if the employee is already a contributing member to PF, then PF should be deducted even though the Basic is above Rs. 15,000/-. However, PF can be limited to Rs. 15,000/-. If the member is not already a contributing member to PF, then there is no need for PF deduction. Please collect EPF Form 11 duly signed by the employee.

Hi, thanks for the reply Vmlakshminarayanan. In our company, her deduction has not started, but while in her earlier company, there was PF deduction. So, would it be okay if she opts out of PF in our organization?

Hi, if the employee is already a contributing member to PF, then PF should be deducted even though the basic salary is above Rs. 15,000. PF can be limited to Rs. 15,000.

EPF as a Social Security Benefit

EPF is a social security benefit. If anyone is contributing to EPF in a previous organization, then the new organization cannot stop the employee's social security benefits. She will continue to be in EPF even if her PF wages are more than 15,000/-.

As far as PF subscription is concerned, the statutory provision is that once you are a member, you have to continue to be so, though the PF contribution can be limited to the statutory limit (Rs. 15,000/- PM). There is no escape.

In our organization, all employees' basic pay plus DA is more than 15,000. In this case, PF deduction is mandatory.