Dear Friends, Who are the Aligible for EPF/EPS & ESI? And what are other benifits we can get from the company? Regards, RK. Mahendra
From India, Hyderabad
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2From India, Hyderabad
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Dear Member,
For knowledge of eligibility and benefits provisions under these two enactments, you may visit the ESIC and EPFO sites.
Regards,
R.N.Khola
From India, Delhi
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For knowledge of eligibility and benefits provisions under these two enactments, you may visit the ESIC and EPFO sites.
Regards,
R.N.Khola
From India, Delhi
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Please find enclosed the Frequently Asked Questions on the PF Act, with details given below:
PROVIDENT FUND
Q1) What is the contribution for Provident Fund by both the Employer and Employee?
Ans: The employee contributes 12% of his/her basic salary, and the same amount is contributed by the employer.
Q2) Is it compulsory for all employees to contribute to the Provident Fund?
Ans: Employees drawing a basic salary up to Rs 6500/- must compulsorily contribute to the Provident Fund, while employees drawing above Rs 6501/- have the option to become a member of the Provident Fund.
Q3) Is it beneficial for employees who draw a salary above Rs 6501/- to become a member of the Provident Fund?
Ans: Yes, because the provident fund contribution by the employer and employee is not taxable income for income tax purposes.
Q4) What if an employee, while joining the establishment, has a basic salary of Rs 4200 and after some time his basic salary increases above Rs 6501/-, does he have an option to terminate his membership from the Provident Fund Act?
Ans: Employees who, while joining the organization, have a basic salary above Rs 6501/- have the option to either become or avoid becoming a member of the Provident Fund. However, employees whose basic salary while joining the organization is less than Rs 6501/- but later increases above Rs 6501/- must compulsorily continue to be a member of the Provident Fund.
Q5) What is the contribution percentage to the Provident Fund and Pension Scheme?
Ans: The employer's contribution of 12% of the basic salary is entirely deposited in the Provident Fund account. Out of the employee's contribution of 12%, 3.67% is contributed to the Provident Fund and 8.33% is deposited in the Pension Scheme.
Q6) Which form has to be filled while becoming a member of the Provident Fund?
Ans: Nomination Form No. 2 has to be filled to become a member of the Provident Fund. The form is available with the HR department.
Q7) Which form has to be filled while transferring the Provident Fund deposit?
Ans: You just have to fill Form No. 13 to transfer your P.F. amount.
Q8) What is the provision of the scheme regarding nomination by a member?
Ans: Each member must make a nomination to receive the amount standing to his credit in the fund in the event of his death. If he has a family, he must nominate one or more persons belonging to his family and none other. If he has no family, he can nominate any person or persons of his choice. However, if he subsequently acquires a family, such a nomination becomes invalid, and he will have to make a fresh nomination of one or more persons belonging to his family. You cannot make your brother your nominee as per the Acts.
Q9) When is an employee eligible to enjoy the pension scheme?
Ans: For an employee to become eligible for the Pension Fund, he must complete membership of the Fund for 10 years.
Q10) What does it mean by continuous service of ten years?
Ans: Continuous service of 10 years in the Employee Pension Fund means that during services, for example, an employee who has worked with Company X for 3 years, then resigned and joined Company Y for 2 years, and then joined another establishment for 5 years, but during these 10 years of service, he has not withdrawn but transferred his Employee Pension Fund, then it is considered continuous service of ten years.
Q11) When can an employee avail the benefit of the Employee Pension Fund scheme which he has contributed during his ten years of continuous service?
Ans: An employee can avail the benefit after completing 58 years of service.
Q12) What happens to the Provident Fund and Employee Pension Fund if an employee wants to resign from the service before completing ten years of continuous service?
Ans: An employee can withdraw the PF accumulations by filling Forms 19 and 10 C, which are available with the HR department.
Q13) What are Forms 19 and 10C?
Ans: Form No. 19 is for Provident Fund withdrawal, and Form No. 10 C is for Pension Scheme withdrawal.
Q14) Do we get any interest on the amount deposited in the Provident Fund account?
Ans: Compound interest as declared by the government is given for every year of service.
Q15) What is the accounting year for the Provident Fund account?
Ans: The accounting year is from March to February.
Q16) What are the benefits provided under the Employee Provident Fund Scheme?
Ans: Two kinds of benefits are provided under the scheme: a) Withdrawal benefit b) Benefit of non-refundable advances
Q18) What is the purpose of the Employee's Pension Scheme?
Ans: The purpose of the scheme is to provide for 1) Superannuation Pension, 2) Retiring Pension, 3) Permanent Total Disablement Pension. Superannuation Pension: A member who has rendered eligible service of 20 years and retires on attaining the age of 58 years. Retirement Pension: A member who has rendered eligible service of 20 years and retires or otherwise ceases to be in employment before attaining the age of 58 years. Short Service Pension: A member has to render eligible service of 10 years and more but less than 20 years.
Q19) How much time does it take to receive P.F. and pension money if an employee resigns from the service?
Ans: Normally, the procedure for receiving P.F. and Pension money is as follows: the employee must fill Forms 19 and 10 C and submit them to the PF Desk, which is then submitted to the P.F. office after two months. This two-month period is a waiting period as the rules state that an employee should not be in employment for two months after resigning if he wants to withdraw his P.F. amount. After completion of two months, the form is submitted to the regional Provident Fund Commissioner's office, after which the employee receives his amount along with interest within a period of 90 days.
Q20) Do we receive money through the postal order?
Ans: Previously, there was a procedure wherein a member used to get P.F. through a postal order, but now while submitting the P.F. withdrawal form, you have to mention your savings bank account number and the complete address of the bank where you hold the account.
Q21) How would I know the amount of accumulations in my PF account?
Ans: The PF office sends an annual statement through the employer, which gives details about the PF accumulations. The statement contains details like the opening balance, amount contributed during the year, withdrawal during the year, interest earned, and the closing balance in the PF account. This statement is sent by the PF department on completion of the financial year.
Q22) Which establishments are covered by the Act?
Ans: Any establishment that employs 20 or more employees. Except for apprentices and casual laborers, every employee, including contract labor, who is in receipt of a basic salary up to Rs. 6500 p.m. is covered by the Act.
Q23) In case after registering the establishment, at any point in time, the number of employees working in it becomes less than 20, will the Act apply?
Ans: Any establishment that has been covered under the Act once shall continue to be governed by the Act even if the number of persons employed therein at any time falls below 20.
Q24) Is the Act applicable to a factory that is closed down but is employing a few employees to look after the assets of the establishment?
Ans: No, where the establishment is closed down and only four security men are employed to keep a watch over the assets and properties of the establishments, the Act would not be applicable.
Q25) Is a trainee an employee under the Act?
Ans: Yes, a trainee would be considered an employee as per the Act, but if the trainee is an apprentice under the Apprentice's Act, then he/she will not be considered an employee under this Act.
Q26) Is it possible to appeal the orders of the Central Government or the Central Provident Fund Commissioner?
Ans: Yes, there is a body called the Provident Fund Appellate Tribunal where an employer can appeal.
Q27) Who is the authority to decide regarding disputes, if any?
Ans: In case there is a dispute regarding the applicability of the Act or the quantum of money to be deducted, etc., the authorities to decide are the i) Central Provident Fund Commissioner, ii) any Additional Provident Fund Commissioner, iii) any Additional Central Provident Fund Commissioner, iv) any Deputy Provident Fund Commissioner, v) any Regional Provident Fund Commissioner, or vi) any Assistant Provident Fund Commissioner.
Q28) What in case there are workers involved as contract labor?
Ans: It is the responsibility of the contractor to deduct the PF and submit a statement to the Principal Employer in the prescribed format by the 7th of every month. The company, being the Principal Employer, would be responsible for the PF deduction of the workers employed on a contract basis.
Q29) Are the persons employed by or through a contractor covered under the Scheme?
Ans: Persons employed by or through a contractor are included in the definition of "employee" under the Employee's Provident Funds Act, 1952, and as such, they are covered under the Scheme.
Q30) In case the contractor fails to deduct and submit the PF amount from the contract workers, what is to be done?
Ans: The company, being the Principal Employer, is responsible for the PF to be deducted from the contract workers as well. In case the contractors fail to deduct and submit the PF dues, then the company has to pay the amount.
Regards
From India, Bangalore
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PROVIDENT FUND
Q1) What is the contribution for Provident Fund by both the Employer and Employee?
Ans: The employee contributes 12% of his/her basic salary, and the same amount is contributed by the employer.
Q2) Is it compulsory for all employees to contribute to the Provident Fund?
Ans: Employees drawing a basic salary up to Rs 6500/- must compulsorily contribute to the Provident Fund, while employees drawing above Rs 6501/- have the option to become a member of the Provident Fund.
Q3) Is it beneficial for employees who draw a salary above Rs 6501/- to become a member of the Provident Fund?
Ans: Yes, because the provident fund contribution by the employer and employee is not taxable income for income tax purposes.
Q4) What if an employee, while joining the establishment, has a basic salary of Rs 4200 and after some time his basic salary increases above Rs 6501/-, does he have an option to terminate his membership from the Provident Fund Act?
Ans: Employees who, while joining the organization, have a basic salary above Rs 6501/- have the option to either become or avoid becoming a member of the Provident Fund. However, employees whose basic salary while joining the organization is less than Rs 6501/- but later increases above Rs 6501/- must compulsorily continue to be a member of the Provident Fund.
Q5) What is the contribution percentage to the Provident Fund and Pension Scheme?
Ans: The employer's contribution of 12% of the basic salary is entirely deposited in the Provident Fund account. Out of the employee's contribution of 12%, 3.67% is contributed to the Provident Fund and 8.33% is deposited in the Pension Scheme.
Q6) Which form has to be filled while becoming a member of the Provident Fund?
Ans: Nomination Form No. 2 has to be filled to become a member of the Provident Fund. The form is available with the HR department.
Q7) Which form has to be filled while transferring the Provident Fund deposit?
Ans: You just have to fill Form No. 13 to transfer your P.F. amount.
Q8) What is the provision of the scheme regarding nomination by a member?
Ans: Each member must make a nomination to receive the amount standing to his credit in the fund in the event of his death. If he has a family, he must nominate one or more persons belonging to his family and none other. If he has no family, he can nominate any person or persons of his choice. However, if he subsequently acquires a family, such a nomination becomes invalid, and he will have to make a fresh nomination of one or more persons belonging to his family. You cannot make your brother your nominee as per the Acts.
Q9) When is an employee eligible to enjoy the pension scheme?
Ans: For an employee to become eligible for the Pension Fund, he must complete membership of the Fund for 10 years.
Q10) What does it mean by continuous service of ten years?
Ans: Continuous service of 10 years in the Employee Pension Fund means that during services, for example, an employee who has worked with Company X for 3 years, then resigned and joined Company Y for 2 years, and then joined another establishment for 5 years, but during these 10 years of service, he has not withdrawn but transferred his Employee Pension Fund, then it is considered continuous service of ten years.
Q11) When can an employee avail the benefit of the Employee Pension Fund scheme which he has contributed during his ten years of continuous service?
Ans: An employee can avail the benefit after completing 58 years of service.
Q12) What happens to the Provident Fund and Employee Pension Fund if an employee wants to resign from the service before completing ten years of continuous service?
Ans: An employee can withdraw the PF accumulations by filling Forms 19 and 10 C, which are available with the HR department.
Q13) What are Forms 19 and 10C?
Ans: Form No. 19 is for Provident Fund withdrawal, and Form No. 10 C is for Pension Scheme withdrawal.
Q14) Do we get any interest on the amount deposited in the Provident Fund account?
Ans: Compound interest as declared by the government is given for every year of service.
Q15) What is the accounting year for the Provident Fund account?
Ans: The accounting year is from March to February.
Q16) What are the benefits provided under the Employee Provident Fund Scheme?
Ans: Two kinds of benefits are provided under the scheme: a) Withdrawal benefit b) Benefit of non-refundable advances
Q18) What is the purpose of the Employee's Pension Scheme?
Ans: The purpose of the scheme is to provide for 1) Superannuation Pension, 2) Retiring Pension, 3) Permanent Total Disablement Pension. Superannuation Pension: A member who has rendered eligible service of 20 years and retires on attaining the age of 58 years. Retirement Pension: A member who has rendered eligible service of 20 years and retires or otherwise ceases to be in employment before attaining the age of 58 years. Short Service Pension: A member has to render eligible service of 10 years and more but less than 20 years.
Q19) How much time does it take to receive P.F. and pension money if an employee resigns from the service?
Ans: Normally, the procedure for receiving P.F. and Pension money is as follows: the employee must fill Forms 19 and 10 C and submit them to the PF Desk, which is then submitted to the P.F. office after two months. This two-month period is a waiting period as the rules state that an employee should not be in employment for two months after resigning if he wants to withdraw his P.F. amount. After completion of two months, the form is submitted to the regional Provident Fund Commissioner's office, after which the employee receives his amount along with interest within a period of 90 days.
Q20) Do we receive money through the postal order?
Ans: Previously, there was a procedure wherein a member used to get P.F. through a postal order, but now while submitting the P.F. withdrawal form, you have to mention your savings bank account number and the complete address of the bank where you hold the account.
Q21) How would I know the amount of accumulations in my PF account?
Ans: The PF office sends an annual statement through the employer, which gives details about the PF accumulations. The statement contains details like the opening balance, amount contributed during the year, withdrawal during the year, interest earned, and the closing balance in the PF account. This statement is sent by the PF department on completion of the financial year.
Q22) Which establishments are covered by the Act?
Ans: Any establishment that employs 20 or more employees. Except for apprentices and casual laborers, every employee, including contract labor, who is in receipt of a basic salary up to Rs. 6500 p.m. is covered by the Act.
Q23) In case after registering the establishment, at any point in time, the number of employees working in it becomes less than 20, will the Act apply?
Ans: Any establishment that has been covered under the Act once shall continue to be governed by the Act even if the number of persons employed therein at any time falls below 20.
Q24) Is the Act applicable to a factory that is closed down but is employing a few employees to look after the assets of the establishment?
Ans: No, where the establishment is closed down and only four security men are employed to keep a watch over the assets and properties of the establishments, the Act would not be applicable.
Q25) Is a trainee an employee under the Act?
Ans: Yes, a trainee would be considered an employee as per the Act, but if the trainee is an apprentice under the Apprentice's Act, then he/she will not be considered an employee under this Act.
Q26) Is it possible to appeal the orders of the Central Government or the Central Provident Fund Commissioner?
Ans: Yes, there is a body called the Provident Fund Appellate Tribunal where an employer can appeal.
Q27) Who is the authority to decide regarding disputes, if any?
Ans: In case there is a dispute regarding the applicability of the Act or the quantum of money to be deducted, etc., the authorities to decide are the i) Central Provident Fund Commissioner, ii) any Additional Provident Fund Commissioner, iii) any Additional Central Provident Fund Commissioner, iv) any Deputy Provident Fund Commissioner, v) any Regional Provident Fund Commissioner, or vi) any Assistant Provident Fund Commissioner.
Q28) What in case there are workers involved as contract labor?
Ans: It is the responsibility of the contractor to deduct the PF and submit a statement to the Principal Employer in the prescribed format by the 7th of every month. The company, being the Principal Employer, would be responsible for the PF deduction of the workers employed on a contract basis.
Q29) Are the persons employed by or through a contractor covered under the Scheme?
Ans: Persons employed by or through a contractor are included in the definition of "employee" under the Employee's Provident Funds Act, 1952, and as such, they are covered under the Scheme.
Q30) In case the contractor fails to deduct and submit the PF amount from the contract workers, what is to be done?
Ans: The company, being the Principal Employer, is responsible for the PF to be deducted from the contract workers as well. In case the contractors fail to deduct and submit the PF dues, then the company has to pay the amount.
Regards
From India, Bangalore
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If any person engaged as apprentice and covered by Apprentices Act then he is not eligible for ESI and PF. If they are engaged in companies standing orders then they are covered.
From India, Mumbai
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From India, Mumbai
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please clear my doubt whether nomination forms of esic & pf and form 11 compulsory kindly clarify. regards mohana 9043439366
From India, Madras
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From India, Madras
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