Worried About No PF and Job Security After 2 Years – What Should I Do?

Dear HR Gurus,

I have been working with a company for the past 2 years in their Marketing team. At the time of joining, I was told that I'd be on probation for 6 months, and after successful completion, I'd be put on rolls.

However, when these 6 months passed, I was not put on the rolls. No PF is deducted, and I get the salary in CASH every month. Although I have been covered under a group mediclaim policy, I'm at times worried about this. Whenever this issue is discussed with the bosses, they say they had some bitter past experience with some employees and due to this, they are not putting new employees on rolls. When I insist on the PF to be deducted, they say that you should better open a PF account.

I do not want to leave this job as the salary is good, and I like the kind of recognition I'm given in the company. But one thing that worries me is the future. I would have nothing in hand when I leave this job, no PF, no gratuity. What shall I do?

Please guide me.

Thanking you in anticipation,

Ritesh Tripathi.

Hi Ritesh,

Are you working with a startup company? Let us know how many of them are working there and the date of establishment. Providing these details is important for offering suggestions, as there are many legal proceedings involved. Please provide those details to receive valuable explanations.

If your company has more than 20 employees, then the company should deduct 12% from your BASIC+DA for PF, and the same amount has to be paid by the employer.

If your company was established a year or a couple of years ago, there may be some legal points that need to be discussed.

Regards,
Saravanan
saranjanar@gmail.com

Thank you, Saravanan, for this prompt reply.

The company is a deemed Public Ltd. company, with closely held share capital (generally, the promoters and their family members hold the shares), quite old, established in 1971. Current Turnover is around Rs. 110 Crores. This company was also declared sick in 2003 but revived in 2006 (the year I joined it).

The number of staff is around 40, and out of this 40, PF is deducted for hardly 15 people (those who joined the company at least 15-20 years ago).

Being a manufacturing firm, there are around 350 workers, out of which around 50 are permanent employees, and the rest are contract workers.

Hope this information helps in getting more advice.

Thanks & Regards,
Ritesh Tripathi

Hi,

As per the prevailing PF scheme, one should get covered under the scheme from the date of joining the establishment. There is no reason why your employer is not deducting PF. Make a strategic move to know the reasons from your employer and make them aware of the statutory law and consequences thereof.

Regards,
R G NAGENDRA

Yes, my salary is in excess of $6500. However, the salary of my boss is 11 times $6500, and his PF is deducted. I'd also like to know about the legal consequences hinted above.

Best Regards,
Ritesh

Hi Ritesh,

The employer has to deduct the PF from every employee from day one. Please check with your HR Manager. Even if you exceed the limit, there is an option stating that an employee can pay the PF voluntarily. Discuss this option with your HR Manager.

Regards,
Saravanan

Ritesh,

You have mentioned a probation period of six months. However, it appears that you are on a contract with the organization, so they may not be able to transition you to the payroll directly. Even while on a contract, it is possible to undergo a probationary period.

I recommend checking with them to clarify this situation from the very beginning.

Rashmee Alvares

Hi people,

I am pretty much frustrated with my current company. It does not pay us regularly, and leave alone salary; it has not paid the PFs of the employees for 5 months. Can't the government themselves realize that there is something wrong with this company?

Anyways, is it possible for me to sue this employer? From day 1 I joined, I have faced issues with salary. The CEO (Founder actually) here uses dirty language in the meetings. He does not even respect his fellow men. It's a 5-year-old (Approx) company and has 40+ employees.

And not to forget that they give us the payslip even before the pay is made. Which means, I have the payslip of the May month but I have not been paid since January.

Note: Praveen - if you happened to reply to my post, then my reply is below.

I am on the regular rolls of the company. If I am not enrolled in the PF Payment system, then why is the PF being deducted from my pay slip (Not payment!!!)? And they do route our salary through the bank.

Hi Praveen,

I am on the regular payroll of the company, and they route my salary through the bank for payment.

Hi, one of my colleagues is working in a reputed company. During our discussion, I came across one thing: her company isn't deducting PF. Whenever she goes to HR, they say that if she is interested in contributing to the PF, she can, and the company is paying the company's part.

I would like to know if there is any law under which an employee has the choice regarding PF contribution. She has a good package (3.5 L/A) and is on the company's payroll. Additionally, the organization may have more than 100 employees.

Thanks & Regards,
Sonal K.