I run a security agency. The principal employer had been paying me 12% of the basic salary even when the basic was over 15,000/- as PF contribution till date. However, once he issued a new P.O. due to a change in minimum wages, he reduced the PF contribution to a limit of 12% of 15,000 only and not the actual basic salary as was being followed earlier.
Can the Employer Change PF Contribution Midway?
My query is: one, can he do that midway during a contract with the same set of employees? And two, can I be provided a copy of the rules that permit him to do so?
From India, Pune
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Can the Employer Change PF Contribution Midway?
My query is: one, can he do that midway during a contract with the same set of employees? And two, can I be provided a copy of the rules that permit him to do so?
From India, Pune
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Dear Abhishekshub, Up till now, your principal employer (PE) was paying you the PF employer's share of 12% on the actual basic salary. Now, he is paying you 12% on a restricted limit of basic as prescribed by law, i.e., ₹15,000. Please refer to the SC Judgment in Marathwada Gramin Bank Karmachari Sanghatana Vs. Management of Marathwada Gramin Bank (SC 2011 LLR 1130). According to this judgment, you are entitled to discontinue the remittance of EPF contributions in excess of the rate prescribed by law. This means you can reduce the contribution to 12% on ₹15,000.
Hope you understand what I said. Furthermore, I would like to add for knowledge sharing for you and other readers as follows:
Responsibilities as a Contractor
You are a contractor. It is your primary responsibility to comply with the provisions applicable to you, whether your PE pays enough to comply with the law or not, or reimburses the cost of the compliance you incurred. For example:
(i) You cannot say that your PE is not paying you enough to pay your employees as per the Minimum Wage Act.
(ii) You cannot say that your PE is not paying you enough to comply with PF, ESI, etc.
From India, Mumbai
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2584Hope you understand what I said. Furthermore, I would like to add for knowledge sharing for you and other readers as follows:
Responsibilities as a Contractor
You are a contractor. It is your primary responsibility to comply with the provisions applicable to you, whether your PE pays enough to comply with the law or not, or reimburses the cost of the compliance you incurred. For example:
(i) You cannot say that your PE is not paying you enough to pay your employees as per the Minimum Wage Act.
(ii) You cannot say that your PE is not paying you enough to comply with PF, ESI, etc.
From India, Mumbai
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Pf name & dob change letter format.doc
PF Circular - Change in Name.pdf