Should The Employee Bear The PF Contribution Of The Employer

Hi

i had joined a company 6 months back. my salary earnings are as follows:

Basic salary: 2250

HRA: 1125

conveyance: 800

LTA: 188

medical: 1250

Special allowance is 1880, which makes it Rs 7500 pm in total.

This is my fixed pay per month. apart from this i have Rs 30000 p.a as variable expenditure which will be paid to me after i complete one year in this company. and if i quit the company before the 1 year term i wouldn't be eligible for this variable pay

apart from this Rs 175 is deducted as professional tax. everything went on smooth till December. but in the salary of December they deducted PF from my salary. and they deducted 24% of my basic+DA(12% employee contribution + 12% employer's contribution), stating that it is mentioned in the appointment letter. and they deducted the PF without getting my signatures required for the PF application form. we got the appointment letter only in the month of October 2007. that is 3 months after joining the company.

1. Now my question is that they have deducted PF only for few people and not for everyone. so can anyone pls tell me to whom the PF is mandatory and to whom it is not( i mean the salary range)

2. Is it necessary for me to pay the contribution of PF on behalf of the employer too? (as it is mentioned in the appointment letter). or is there any law stating it illegal for an employee bearing the contribution of the employer?

Hi,
No way to deduct employer portion from employee's salary, it is mandatory for employer only because its a company's liablitiy not employee's. If the establishment comes under PF Act then employer will be the only responsible for any disqualification in this regards.
Secondly there is a PF exemption limit that is Rs6500/-(Basic).
So dear ask them what is the way of deduction, you can only bear your deduction part in respect of PF, as per your salary it will be Ras270(12% of 2250/-). You can also ask them about the minimum wages because now pf department has already notified that PF should be deducted on minimum wages amount.
Hope now u will get some idea.
Regards
Vikas Kumar

Hi,
Please verify your slary structure in your appointment letter. Most of the companies is deducting the PF @ 12%+12% (Employer+Employee). For example your salary structure is as below.
Basic xxxxx
DA xxxxx
HRA xxxxx
Conveyance xxxxx
LTA xxxxx
Medical xxxxx
Gratuity xxxxx
PF Employer Share xxxxx
--------------
CTC (A) xxxxxxxx
---------------
Less Deductions
Professional Tax xxxxx
PF Employer xxxxx
PF Employee xxxxx
Income Tax xxxxx
Gtratuity xxxxx
Any other Deductions xxxxx
---------
Total Deductions(B) xxxxx
---------
Net take home Salary (A-B)
Regardds,
Raplou HS

Employer's contribution of PF cannot be deducted from your salary. You are liable for contribution @12% of your basic salary only(since there is no DA)Rs 30000 payable annually and conditionally (as you have to work for 1 year) cannot be taken as a part of salary. And an appointment order empowering an employer to take his own share of PF from an employee will not stand and is void. You can challenge it.
It is not mandatory that all employees shall be under EPF; only those whose initial salary is not more than Rs 6500 need be covered by law. Presume that others, right at the time of joining, were drawing more than 6500 (not considering the HRA, CCA etc)
Regards,
Madhu.T.K