Hi , Need your suggestion in this matter, Is it possible to withdraw PF if employee resigned within probation period?
From India
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From India
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Dear Shrusti, Whatever be the grounds, application for PF withdrawal will be processed after two months from the date of acceptance of resignation.
From India, Bangalore
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530From India, Bangalore
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Hi, the employee can withdraw the PF amount, but if the employee has served less than six months of tenure in the organization, then he/she will not receive the employer's contribution of 8.33% towards the Employee Pension Scheme.
From India, Madras
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From India, Madras
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Thank you, everyone. Yes, you can withdraw your P.F. It doesn't matter if you are on a probation period or permanent. However, you are only eligible to withdraw the fund amount, which is 12% of your total, with 3.67% being the employer's contribution.
The procedures are the same through Form-19, 10-C, and S.S.N.
Regards,
Bunti
From India, Velluru
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The procedures are the same through Form-19, 10-C, and S.S.N.
Regards,
Bunti
From India, Velluru
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[QUOTE=harsha.nandakumar;1347129]Thanks for the info.
What if he is terminated? Can he withdraw the PF amount, and what if the company says it is not willing to show any record of service? Say he has worked for 3 years. Can he get the Employee Pension Scheme and PF?
Hi Harsha, of course, he is eligible to get both the PF and pension amount because you can remove his records in your company, but you can't do the same in government records. An employee has all the rights to withdraw his money; you can't stop that.
From India, Bangalore
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What if he is terminated? Can he withdraw the PF amount, and what if the company says it is not willing to show any record of service? Say he has worked for 3 years. Can he get the Employee Pension Scheme and PF?
Hi Harsha, of course, he is eligible to get both the PF and pension amount because you can remove his records in your company, but you can't do the same in government records. An employee has all the rights to withdraw his money; you can't stop that.
From India, Bangalore
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Dear Shrusthi,
The employee has to complete a minimum period of six months. Please let me know the probation period. If six months are completed, then he can withdraw the PF. If it is less than six months, he is not eligible to withdraw the pension fund.
It is advised that you transfer the PF to your current employer. Submit Form-13 to transfer the PF from the ex-employer to the current employer.
Thanks,
Mohammed.
From India, Hyderabad
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The employee has to complete a minimum period of six months. Please let me know the probation period. If six months are completed, then he can withdraw the PF. If it is less than six months, he is not eligible to withdraw the pension fund.
It is advised that you transfer the PF to your current employer. Submit Form-13 to transfer the PF from the ex-employer to the current employer.
Thanks,
Mohammed.
From India, Hyderabad
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Is there any way by which one can withdraw the PF money without resigning from the job? I am talking about someone who is not interested in getting a loan from PF but wants his and the employer's share without sacrificing the job.
Looking forward to your inputs.
Regards,
Avinash K.
From India, Mumbai
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Looking forward to your inputs.
Regards,
Avinash K.
From India, Mumbai
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Dear Shrishti Ji,
Certainly, you can apply for payment of your PF dues after resigning during the probation period. However, if you are taking up a new job, may I suggest that you apply for the transfer of your old PF account to the new employer? This will give you continuity of your pension account. If you close the current PF account and withdraw your dues, you will lose the pension contribution. All those changing jobs from one employer to another, please keep this in mind and consider the continuation of their PF accounts with the new employment. Only those who are permanently bidding goodbye to their careers may close their PF accounts and take whatever dues they are eligible for with the EPS 1995 pension or otherwise.
Thanks and regards.
From India, Pune
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Certainly, you can apply for payment of your PF dues after resigning during the probation period. However, if you are taking up a new job, may I suggest that you apply for the transfer of your old PF account to the new employer? This will give you continuity of your pension account. If you close the current PF account and withdraw your dues, you will lose the pension contribution. All those changing jobs from one employer to another, please keep this in mind and consider the continuation of their PF accounts with the new employment. Only those who are permanently bidding goodbye to their careers may close their PF accounts and take whatever dues they are eligible for with the EPS 1995 pension or otherwise.
Thanks and regards.
From India, Pune
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Well said, Dhanajay. It is the employee's right to withdraw the PF amount that he has been contributing from his salary. The company is not losing anything if the employee withdraws. However, as rightly said by Ramachandran, please advise your staff not to withdraw but instead to transfer.
From India, Bangalore
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From India, Bangalore
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Dear Harsha,
I think you need to pay more attention or readdress the following major points which will assist you in understanding the EPF Scheme -1952 better:
EMPLOYEES' PROVIDENT FUND SCHEME 1952
Employee Definition:
"Employee" as defined in Section 2(f) of the Act means any person who is employed for wages in any kind of work, manual or otherwise, in or in connection with the work of an establishment and who receives wages directly or indirectly from the employer. This includes any person employed by or through a contractor in or in connection with the work of the establishment.
Membership:
All employees (including casual, part-time, daily wage contract, etc.) other than an excluded employee are required to be enrolled as members of the fund on the day the Act comes into force in such establishment.
Basic Wages:
"Basic Wages" means all emoluments earned by an employee while on duty, on leave, or on holiday with wages, in accordance with the terms of the contract of employment and which are paid or payable in cash. However, it does not include:
- The cash value of any food concession
- Any dearness allowance (i.e., all cash payments by whatever name called, paid to an employee on account of a rise in the cost of living), house rent allowance, overtime allowance, bonus, commission, or any other allowance payable to the employee in respect of employment or work done in such employment.
- Any present made by the employer.
Excluded Employee:
"Excluded Employee" as defined under para 2(f) of the Employees' Provident Fund Scheme means an employee who, having been a member of the fund, has withdrawn the full amount of accumulation in the fund on retirement from service after attaining the age of 55 years; or an employee whose pay exceeds Rs. Five Thousand per month at the time, otherwise entitled to become a member of the fund.
Explanation:
'Pay' includes basic wages with dearness allowance, retaining allowance (if any), and the cash value of food concessions admissible thereon.
Employee Provident Fund Scheme:
The Employees' Provident Fund Scheme takes care of the following needs of the members:
(i) Retirement
(ii) Medical Care
(iii) Housing
(iv) Family obligations
(v) Education of Children
(vi) Financing of Insurance Policies
How the Employees' Provident Fund Scheme works:
As per the amendment dated 22.9.1997 in the Act, both the employees and the employer contribute to the fund at the rate of 12% of the basic wages, dearness allowance, and retaining allowance, if any, payable to employees per month. The rate of contribution is 10% in the case of the following establishments:
- Any covered establishment with fewer than 20 employees, for establishments covered prior to 22.9.97.
- Any sick industrial company as defined in clause (O) of Sub-Section (1) of Section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985, and which has been declared as such by the Board for Industrial and Financial Reconstruction.
- Any establishment which has at the end of any financial year accumulated losses equal to or exceeding its entire net worth.
- Any establishment engaged in the manufacturing of (a) jute, (b) Breed, (d) coir, and (e) Guar gum Industries/Factories. The contribution under the Employees' Provident Fund Scheme by the employee and employer will be as under with effect from 22.9.1997.
Employees' Provident Fund Interest rate:
The rate of interest is fixed by the Central Government in consultation with the Central Board of Trustees, Employees' Provident Fund every year during March/April. The interest is credited to the member's account on a monthly running balance with effect from the last day of each year. The rate of interest for the year 1998-99 has been notified as 12%. The rate of interest for 99-2000 w.e.f. 1.7.'99 was 11% on monthly balances. In 2000-2001, CBT recommended 10.25% to be notified by the Government.
Benefits:
A) A member of the provident fund can withdraw the full amount at credit in the fund on retirement from service after attaining the age of 55 years. The full amount in the provident fund can also be withdrawn by the member under the following circumstances:
- A member who has not attained the age of 55 years at the time of termination of service.
- A member who is retired on account of permanent and total disablement due to bodily or mental infirmity.
- On migration from India for permanent settlement abroad or for taking employment abroad.
- In the case of mass or individual retrenchment.
B) In the case of the following contingencies, the payment of provident fund can be made after completing a continuous period of not less than two months immediately preceding the date on which the application for withdrawal is made by the member:
- Where employees of a closed establishment are transferred to another establishment, which is not covered under the Act.
- Where a member is discharged and is given retrenchment compensation under the Industrial Dispute Act, 1947.
Withdrawal before retirement:
A member can withdraw up to 90% of the amount of provident fund at credit after attaining the age of 54 years or within one year before actual retirement on superannuation, whichever is later. A claim application in form 19 may be submitted to the concerned Provident Fund Office.
Accumulations of a deceased member:
The amount of Provident Fund at the credit of the deceased member is payable to nominees/legal heirs. A claim application in form 20 may be submitted to the concerned Provident Fund Office.
Transfer of Provident Fund account:
The transfer of Provident Fund account from one region to another, from an Exempted Provident Fund Trust to an Unexempted Fund in a region and vice-versa can be done as per the Scheme. A Transfer Application in form 13 may be submitted to the concerned Provident Fund Office.
Nomination:
The member of the Provident Fund shall make a declaration in Form 2, a nomination conferring the right to receive the amount that may stand to the credit in the fund in the event of death. The member may furnish the particulars concerning himself and his family. These particulars furnished by the member of Provident Fund in Form 2 will help the Organization in building up the data bank for use in the event of the death of the member.
Annual Statement of account:
As soon as possible and after the close of each period of the currency of contribution, annual statements of accounts will be sent to each member through the factory or other establishment where the member was last employed. The statement of accounts in the fund will show the opening balance at the beginning of the period, the amount contributed during the year, the total amount of interest credited at the end of the period or any withdrawal during the period, and the closing balance at the end of the period. Members should satisfy themselves as to the correctness of the annual statement of accounts, and any errors should be brought through the employer to the notice of the correct Provident Fund Office within 6 months of receiving the statement.
Regards,
Dinesh Negi
Asst. Manager- HR
Max Healthcare Institute Ltd.
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I think you need to pay more attention or readdress the following major points which will assist you in understanding the EPF Scheme -1952 better:
EMPLOYEES' PROVIDENT FUND SCHEME 1952
Employee Definition:
"Employee" as defined in Section 2(f) of the Act means any person who is employed for wages in any kind of work, manual or otherwise, in or in connection with the work of an establishment and who receives wages directly or indirectly from the employer. This includes any person employed by or through a contractor in or in connection with the work of the establishment.
Membership:
All employees (including casual, part-time, daily wage contract, etc.) other than an excluded employee are required to be enrolled as members of the fund on the day the Act comes into force in such establishment.
Basic Wages:
"Basic Wages" means all emoluments earned by an employee while on duty, on leave, or on holiday with wages, in accordance with the terms of the contract of employment and which are paid or payable in cash. However, it does not include:
- The cash value of any food concession
- Any dearness allowance (i.e., all cash payments by whatever name called, paid to an employee on account of a rise in the cost of living), house rent allowance, overtime allowance, bonus, commission, or any other allowance payable to the employee in respect of employment or work done in such employment.
- Any present made by the employer.
Excluded Employee:
"Excluded Employee" as defined under para 2(f) of the Employees' Provident Fund Scheme means an employee who, having been a member of the fund, has withdrawn the full amount of accumulation in the fund on retirement from service after attaining the age of 55 years; or an employee whose pay exceeds Rs. Five Thousand per month at the time, otherwise entitled to become a member of the fund.
Explanation:
'Pay' includes basic wages with dearness allowance, retaining allowance (if any), and the cash value of food concessions admissible thereon.
Employee Provident Fund Scheme:
The Employees' Provident Fund Scheme takes care of the following needs of the members:
(i) Retirement
(ii) Medical Care
(iii) Housing
(iv) Family obligations
(v) Education of Children
(vi) Financing of Insurance Policies
How the Employees' Provident Fund Scheme works:
As per the amendment dated 22.9.1997 in the Act, both the employees and the employer contribute to the fund at the rate of 12% of the basic wages, dearness allowance, and retaining allowance, if any, payable to employees per month. The rate of contribution is 10% in the case of the following establishments:
- Any covered establishment with fewer than 20 employees, for establishments covered prior to 22.9.97.
- Any sick industrial company as defined in clause (O) of Sub-Section (1) of Section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985, and which has been declared as such by the Board for Industrial and Financial Reconstruction.
- Any establishment which has at the end of any financial year accumulated losses equal to or exceeding its entire net worth.
- Any establishment engaged in the manufacturing of (a) jute, (b) Breed, (d) coir, and (e) Guar gum Industries/Factories. The contribution under the Employees' Provident Fund Scheme by the employee and employer will be as under with effect from 22.9.1997.
Employees' Provident Fund Interest rate:
The rate of interest is fixed by the Central Government in consultation with the Central Board of Trustees, Employees' Provident Fund every year during March/April. The interest is credited to the member's account on a monthly running balance with effect from the last day of each year. The rate of interest for the year 1998-99 has been notified as 12%. The rate of interest for 99-2000 w.e.f. 1.7.'99 was 11% on monthly balances. In 2000-2001, CBT recommended 10.25% to be notified by the Government.
Benefits:
A) A member of the provident fund can withdraw the full amount at credit in the fund on retirement from service after attaining the age of 55 years. The full amount in the provident fund can also be withdrawn by the member under the following circumstances:
- A member who has not attained the age of 55 years at the time of termination of service.
- A member who is retired on account of permanent and total disablement due to bodily or mental infirmity.
- On migration from India for permanent settlement abroad or for taking employment abroad.
- In the case of mass or individual retrenchment.
B) In the case of the following contingencies, the payment of provident fund can be made after completing a continuous period of not less than two months immediately preceding the date on which the application for withdrawal is made by the member:
- Where employees of a closed establishment are transferred to another establishment, which is not covered under the Act.
- Where a member is discharged and is given retrenchment compensation under the Industrial Dispute Act, 1947.
Withdrawal before retirement:
A member can withdraw up to 90% of the amount of provident fund at credit after attaining the age of 54 years or within one year before actual retirement on superannuation, whichever is later. A claim application in form 19 may be submitted to the concerned Provident Fund Office.
Accumulations of a deceased member:
The amount of Provident Fund at the credit of the deceased member is payable to nominees/legal heirs. A claim application in form 20 may be submitted to the concerned Provident Fund Office.
Transfer of Provident Fund account:
The transfer of Provident Fund account from one region to another, from an Exempted Provident Fund Trust to an Unexempted Fund in a region and vice-versa can be done as per the Scheme. A Transfer Application in form 13 may be submitted to the concerned Provident Fund Office.
Nomination:
The member of the Provident Fund shall make a declaration in Form 2, a nomination conferring the right to receive the amount that may stand to the credit in the fund in the event of death. The member may furnish the particulars concerning himself and his family. These particulars furnished by the member of Provident Fund in Form 2 will help the Organization in building up the data bank for use in the event of the death of the member.
Annual Statement of account:
As soon as possible and after the close of each period of the currency of contribution, annual statements of accounts will be sent to each member through the factory or other establishment where the member was last employed. The statement of accounts in the fund will show the opening balance at the beginning of the period, the amount contributed during the year, the total amount of interest credited at the end of the period or any withdrawal during the period, and the closing balance at the end of the period. Members should satisfy themselves as to the correctness of the annual statement of accounts, and any errors should be brought through the employer to the notice of the correct Provident Fund Office within 6 months of receiving the statement.
Regards,
Dinesh Negi
Asst. Manager- HR
Max Healthcare Institute Ltd.
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Provident Fund - Excluded Employee - Definition.pdf