Dear All,
Whether it is mandatory for all employee for deduction of provident fund, may be their wages are higher.
Is thier any salary limit for the same?
What is the concept of Rs6500/?What are the employer bindation for paying PF?
Would request your detail views on these some questions.
Regards
Ranjeet
From India, New Delhi
11Whether it is mandatory for all employee for deduction of provident fund, may be their wages are higher.
Is thier any salary limit for the same?
What is the concept of Rs6500/?What are the employer bindation for paying PF?
Would request your detail views on these some questions.
Regards
Ranjeet
From India, New Delhi
Since the salary limit for deduction of PF and Pension Scheme under PF is 6500, many employees drawing more than that of - not interested in getting deducted PF atleast to the limit of Rs.6500. Since PF is one of the social security measure and indirect savings to an employee, they should keep in mind about the benefits out of PF contribution.
Thought the employee is ready to contribute at a higher rate of pf deduction (as it permissible),the employer may restrict his contribution to the extent of Rs.6500 of salary/wages. Employer has to contribute his share as 8.33% towards Family Pension Fund and balance of 12% after the FPS contribution to Provident fund contribution.
From India, Madras
Thought the employee is ready to contribute at a higher rate of pf deduction (as it permissible),the employer may restrict his contribution to the extent of Rs.6500 of salary/wages. Employer has to contribute his share as 8.33% towards Family Pension Fund and balance of 12% after the FPS contribution to Provident fund contribution.
From India, Madras
Dear Ranjit,
If an establishment is covered by EPF and is not exempted otherwise on account of better facilities being provided to the employees in respect of retirement benefits than what has been provided under the Employees Provident Fund and Miscellaneous provisions Act and by the EPF organisation, it is mandatory that contributions at the prescribed rates should be paid by the employer in respect of those employees who are already members of EPF and those whose salary (basic + dearness allowance) does not exceed Rs 6500.
Certainly, an employee whose salary exceeds Rs 6500 right at the time of his joining the establishment shall be excluded from coverage. It is not mandatory that he should be excluded but if both of them agree to be covered, he can also be included as a member.
An existing member employee will continue to be covered by EPF even if his salary exceeds Rs 6500. Similarly, a new employee who was earlier a member of the EPF when he was with some other employment which he left but has not withdrawn his then PF accumulations should also be considered as an 'existing member' and he should be covered in the new establishment even if his salary exceeds Rs 6500.
In respect of those member employees who are drawing more than Rs 6500, the employer can restrict his share of contribution to the prescribed rate of 12% + admin etc on Rs 6500. Here also, it is not mandatory to restrict so but if the employer wishes to contribute on the whole of qualifying salary he can do so.
Regards,
Madhu.T.K
From India, Kannur
If an establishment is covered by EPF and is not exempted otherwise on account of better facilities being provided to the employees in respect of retirement benefits than what has been provided under the Employees Provident Fund and Miscellaneous provisions Act and by the EPF organisation, it is mandatory that contributions at the prescribed rates should be paid by the employer in respect of those employees who are already members of EPF and those whose salary (basic + dearness allowance) does not exceed Rs 6500.
Certainly, an employee whose salary exceeds Rs 6500 right at the time of his joining the establishment shall be excluded from coverage. It is not mandatory that he should be excluded but if both of them agree to be covered, he can also be included as a member.
An existing member employee will continue to be covered by EPF even if his salary exceeds Rs 6500. Similarly, a new employee who was earlier a member of the EPF when he was with some other employment which he left but has not withdrawn his then PF accumulations should also be considered as an 'existing member' and he should be covered in the new establishment even if his salary exceeds Rs 6500.
In respect of those member employees who are drawing more than Rs 6500, the employer can restrict his share of contribution to the prescribed rate of 12% + admin etc on Rs 6500. Here also, it is not mandatory to restrict so but if the employer wishes to contribute on the whole of qualifying salary he can do so.
Regards,
Madhu.T.K
From India, Kannur
Whether it is mandatory for all Civil construction workers for deduction of provident fund, may be their wages are higher than Rs.6,500/- P.M.
Is thier any salary limit for the same?
What is the concept of Rs6500/?What are the employer bindation for paying PF?
Recently many contractors are under pressure from PF authorities in Kochi, Kerala for incorporate all workers under PF rule. Practically it is impossible because most of the workers are migrating natures, they are not willing to deduction of any amount from their wages.
Would request your detail views on these some questions.
Regards
JK10
From India, Kochi
Is thier any salary limit for the same?
What is the concept of Rs6500/?What are the employer bindation for paying PF?
Recently many contractors are under pressure from PF authorities in Kochi, Kerala for incorporate all workers under PF rule. Practically it is impossible because most of the workers are migrating natures, they are not willing to deduction of any amount from their wages.
Would request your detail views on these some questions.
Regards
JK10
From India, Kochi
Dear Mr Madhu,
Please educate me where (in the EPF&MP Act) it says that the Employer's contribution is restricted to only Rs 6500 (12% of Rs 6500 = Rs 541) ONLY in case he Basic+DA exceeded Rs 6500?
As far as I know, if a employee getting, lets say Rs 10,000 as Basic+DA, he contributes Rs 1200 (12% of Basic+DA) while the Employer contributes Rs 1361 in the following heads:
Pension Fund: Rs 541 (This is restricted to Rs 541, 8.33% of Rs 6500)
Provident Fund: Rs 659 (The remaining of 12% of the Basic+DA, Rs 10000)
Admin/EDLI/Ins: Rs 161 (1.61% of Rs 10000).
Total Employer's Contribution: Rs 1361
Thanks!
Rajusiachen
From India, Coimbatore
Please educate me where (in the EPF&MP Act) it says that the Employer's contribution is restricted to only Rs 6500 (12% of Rs 6500 = Rs 541) ONLY in case he Basic+DA exceeded Rs 6500?
As far as I know, if a employee getting, lets say Rs 10,000 as Basic+DA, he contributes Rs 1200 (12% of Basic+DA) while the Employer contributes Rs 1361 in the following heads:
Pension Fund: Rs 541 (This is restricted to Rs 541, 8.33% of Rs 6500)
Provident Fund: Rs 659 (The remaining of 12% of the Basic+DA, Rs 10000)
Admin/EDLI/Ins: Rs 161 (1.61% of Rs 10000).
Total Employer's Contribution: Rs 1361
Thanks!
Rajusiachen
From India, Coimbatore
The rates of contributions are not given in the Act but in the Schemes, viz, the Employees Provident Funds Scheme, 1952. In the Schemes, who are excluded employee are given in scheme 2(f)(ii) as one whose salary at the time of joining is more than Rs 6500. Similarly, contributions payable are given in scheme 26 also.
As already stated it is not compulsory that the employer should restrict the contribution to Rs 6500 but he can contribute on any higher salary as is the case with almost all corporate business houses.
There can not be any exception to any civil workers. They are also workmen within the meaning of Factories Act or Industrial Disputes Act. Then why should we have a different treatment? They have to be covered. PF is not concerned about the migrating nature of labour and they can not bother their mobility also.
Regards,
Madhu.T.K
From India, Kannur
As already stated it is not compulsory that the employer should restrict the contribution to Rs 6500 but he can contribute on any higher salary as is the case with almost all corporate business houses.
There can not be any exception to any civil workers. They are also workmen within the meaning of Factories Act or Industrial Disputes Act. Then why should we have a different treatment? They have to be covered. PF is not concerned about the migrating nature of labour and they can not bother their mobility also.
Regards,
Madhu.T.K
From India, Kannur
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