Respected seniors, I would like to know under which rule in the PF Act an employer is bound to pay PF contributions for an employee whose basic salary exceeds 6500 during their employment at the same organization.
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From India, Guntur
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1Regards
From India, Guntur
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No, it's not mandatory for the employer to pay a contribution on a basic salary of 6500 or more. An employee whose basic salary is more than 6.5k has the choice of deciding whether or not to contribute to their PF account. If the employee contributes more than 12% or more than the basic salary of 6.5k, the employer is not bound to match the employee in the same way in both cases. It's solely the employee's decision.
From India, Calcutta
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From India, Calcutta
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PF Contribution Obligations for Employers
Employers are bound to pay PF beyond ₹6,500 when an employee is already a member of the EPF. Suppose an employee, while joining, is getting ₹6,000. After one year, his basic salary increases, and he gets ₹7,000 as basic. In that case, the employer has to pay contributions for the pension fund on ₹6,500 and other contributions as per company rules.
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From United States, Chicago
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Employers are bound to pay PF beyond ₹6,500 when an employee is already a member of the EPF. Suppose an employee, while joining, is getting ₹6,000. After one year, his basic salary increases, and he gets ₹7,000 as basic. In that case, the employer has to pay contributions for the pension fund on ₹6,500 and other contributions as per company rules.
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From United States, Chicago
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Mr. Soumik Mukherjee perhaps did not understand the real import of Veerabhathini's question. "Once covered, always covered" is the principle in the EPF Act. If the employee was covered under the PF scheme because their wage and DA/retaining allowance, etc., were below 6500, they will continue to be covered even when their wage goes up beyond 6500 in the same company. I think Section 26A of the EPF & MP Act deals with this matter. The only thing is that their contribution can be pegged to what is due on Rs. 6500 per month.
Regards,
O Abdul Hameed
Formerly Addl. Commissioner
ESI Corporation
New Delhi
From India, Coimbatore
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Regards,
O Abdul Hameed
Formerly Addl. Commissioner
ESI Corporation
New Delhi
From India, Coimbatore
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