An employee receiving a salary (PF qualifying salary) of more than Rs 15,000 shall be covered under EPF. However, if they join the EPF after 1st September 2014, they cannot be part of the Pension Scheme. In the case of such employees, the employer has no legal obligation to cover them under EPF as well. This exemption does not apply to existing PF members. An existing member refers to a person already enrolled in EPF/EPS.
For a new employee joining with a salary exceeding Rs 15,000, the employer is only required to contribute to EPF. The contribution is not limited to 12% of Rs 15,000; both the employer and employee can agree on any percentage. If the employee considers EPF as an investment and wishes to contribute a higher amount to avail benefits under Section 80C of the Income Tax Act, they are permitted to do so. The employer's legal liability, however, is capped at 12% of Rs 15,000. In a CTC structure, it is acceptable for the employer to contribute higher amounts.