Hi,
My current organization is deducting PF amount of employer's and employee's contributions from my gross salary. My monthly gross is 30,000, which includes a basic of 15,100. The PF calculated is 1,800 Rs. Here from my gross 30,000, the PF amount of 1,800 * 2 = 3,600, totaling 3,600 is deducted. My monthly take-home salary is 26,200.
Kindly let me know why the company is not giving a contribution to PF. If this is incorrect, please advise me on how I can proceed legally.
Thank you.
From India, Mumbai
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My current organization is deducting PF amount of employer's and employee's contributions from my gross salary. My monthly gross is 30,000, which includes a basic of 15,100. The PF calculated is 1,800 Rs. Here from my gross 30,000, the PF amount of 1,800 * 2 = 3,600, totaling 3,600 is deducted. My monthly take-home salary is 26,200.
Kindly let me know why the company is not giving a contribution to PF. If this is incorrect, please advise me on how I can proceed legally.
Thank you.
From India, Mumbai
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Dear Lalit,
You need to confirm with your company if they are counting 30,000/- as gross or CTC. The employer's share of PF is normally shown in CTC but not in gross salary. Also, as your salary is more than the prescribed limit of Rs. 15,000/-, thus no PF is applicable to be contributed by the organization. Please check with your HR team.
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384You need to confirm with your company if they are counting 30,000/- as gross or CTC. The employer's share of PF is normally shown in CTC but not in gross salary. Also, as your salary is more than the prescribed limit of Rs. 15,000/-, thus no PF is applicable to be contributed by the organization. Please check with your HR team.
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Since I'm not clear with your question, I will try to answer it based on my understanding. From your query, I believe that the PF wages they have taken are only Rs. 15,000. Instead of deducting Rs. 1,800 from your salary, they have deducted Rs. 3,600 (including the employer's share) from your salary. As per the Act, this is absolutely wrong.
To confirm my statement, you need to download your PF passbook from the PF website. See whether the employee contribution is Rs. 1,800 or Rs. 3,600. Then, you can conclude.
Let me know if you need any clarifications.
From India, Chennai
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To confirm my statement, you need to download your PF passbook from the PF website. See whether the employee contribution is Rs. 1,800 or Rs. 3,600. Then, you can conclude.
Let me know if you need any clarifications.
From India, Chennai
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Dear Members,
I have a query regarding voluntary contributions and exempt employees. Here is the situation:
An employee who already has a UAN number (from his previous employment) has joined us and wants to continue PF contributions even though his salary in our organization is above the PF ceiling of Rs. 15,000/-.
Member registration based on the existing UAN is not proceeding because there is a mismatch in his Date of Birth (his actual DoB as per AADHAAR and other records is different from what is registered against his UAN by his previous employer). The person has informed us that he has submitted, through his previous employer, a joint declaration/application for correction in his DoB, which has not yet been processed by the concerned EPF RO.
Under the circumstances, I can neither register him with the incorrect DoB (to match his UAN record) because it would be like perjury, nor register him as a new employee for a fresh UAN. Presently, my only recourse appears to be to consider him an "excluded employee" and not transfer his UAN to the company.
My questions in this regard are:
a) Since he is already a member of EPFO, is it compulsory to contribute to PF even though he has crossed the ceiling limit? I am a bit confused about the statement "in case you have been a member of EPFO once, then you are not allowed to opt out of the scheme" on this site: All Employee Provident Fund Questions Answered
b) Can he be considered an "excluded employee" and voluntarily stop PF contributions?
c) If he is an "excluded employee," does the company's liability towards his PF contribution also cease?
d) How best to deal with this situation?
Advice from experienced forum members would be much appreciated.
From India, Kochi
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I have a query regarding voluntary contributions and exempt employees. Here is the situation:
An employee who already has a UAN number (from his previous employment) has joined us and wants to continue PF contributions even though his salary in our organization is above the PF ceiling of Rs. 15,000/-.
Member registration based on the existing UAN is not proceeding because there is a mismatch in his Date of Birth (his actual DoB as per AADHAAR and other records is different from what is registered against his UAN by his previous employer). The person has informed us that he has submitted, through his previous employer, a joint declaration/application for correction in his DoB, which has not yet been processed by the concerned EPF RO.
Under the circumstances, I can neither register him with the incorrect DoB (to match his UAN record) because it would be like perjury, nor register him as a new employee for a fresh UAN. Presently, my only recourse appears to be to consider him an "excluded employee" and not transfer his UAN to the company.
My questions in this regard are:
a) Since he is already a member of EPFO, is it compulsory to contribute to PF even though he has crossed the ceiling limit? I am a bit confused about the statement "in case you have been a member of EPFO once, then you are not allowed to opt out of the scheme" on this site: All Employee Provident Fund Questions Answered
b) Can he be considered an "excluded employee" and voluntarily stop PF contributions?
c) If he is an "excluded employee," does the company's liability towards his PF contribution also cease?
d) How best to deal with this situation?
Advice from experienced forum members would be much appreciated.
From India, Kochi
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Mr. Arun,
Generate a new UAN for the member in your current organization. Ask the member to activate UAN using the new mobile number. The employee can link his previous PF account using the 'ONE EMPLOYEE ONE EPF ACCOUNT' scheme available on the EPF Portal. His previous UAN will be deactivated once he has completed this step. Once it is linked, he will be able to transfer funds from his previous PF account to the current account after updating the KYC in the current account. Let me know if you need any clarifications.
From India, Chennai
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Generate a new UAN for the member in your current organization. Ask the member to activate UAN using the new mobile number. The employee can link his previous PF account using the 'ONE EMPLOYEE ONE EPF ACCOUNT' scheme available on the EPF Portal. His previous UAN will be deactivated once he has completed this step. Once it is linked, he will be able to transfer funds from his previous PF account to the current account after updating the KYC in the current account. Let me know if you need any clarifications.
From India, Chennai
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Opting Out of the PF Scheme
1. He can opt out of the scheme. Besides, the employer has no statutory obligation to contribute towards PF if the basic pay exceeds 15K. Some companies have a policy whereby they do not make an employee a PF member if the basic pay exceeds 15K.
2. Exclusion from PF Membership
Where a company has a scheme of having PF members whose basic pay exceeds 15K, individuals who want to be excluded can do so by submitting an application stating that they do not want to become a PF member. There is no compulsion.
3. Company Liability
Company liability also ceases automatically as there is no statutory obligation on contribution when the basic pay is in excess of 15K.
Hope that clarifies.
Regards, Anil Raina
From India, Delhi
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1. He can opt out of the scheme. Besides, the employer has no statutory obligation to contribute towards PF if the basic pay exceeds 15K. Some companies have a policy whereby they do not make an employee a PF member if the basic pay exceeds 15K.
2. Exclusion from PF Membership
Where a company has a scheme of having PF members whose basic pay exceeds 15K, individuals who want to be excluded can do so by submitting an application stating that they do not want to become a PF member. There is no compulsion.
3. Company Liability
Company liability also ceases automatically as there is no statutory obligation on contribution when the basic pay is in excess of 15K.
Hope that clarifies.
Regards, Anil Raina
From India, Delhi
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The Act clearly mentions that if an employee is an existing member of PF (from his previous employment), he can't opt out from PF contributions even if he crosses the slab of Rs. 15K.
If somebody differs from my above statement, please validate their statement with enough proof from the PF Act. I can learn.
From India, Chennai
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If somebody differs from my above statement, please validate their statement with enough proof from the PF Act. I can learn.
From India, Chennai
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Two Situations Regarding PF Membership
1. When an employee does not want to continue as a PF member in the new organization: The rule is that if an employee settles their PF account, fills out Form D, and provides a declaration in an affidavit to their new employer stating that they have settled their PF account, they are considered an "Excluded Employee" and are therefore out of the PF ambit.
2. In the case where an employee wants to retain their PF membership but the company does not have PF membership for employees drawing a basic pay of more than 15K, the employer's liability is restricted to 12% of 15K, i.e., Rs. 1800 per month.
Regards, Anil Raina
From India, Delhi
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1. When an employee does not want to continue as a PF member in the new organization: The rule is that if an employee settles their PF account, fills out Form D, and provides a declaration in an affidavit to their new employer stating that they have settled their PF account, they are considered an "Excluded Employee" and are therefore out of the PF ambit.
2. In the case where an employee wants to retain their PF membership but the company does not have PF membership for employees drawing a basic pay of more than 15K, the employer's liability is restricted to 12% of 15K, i.e., Rs. 1800 per month.
Regards, Anil Raina
From India, Delhi
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Hi Mr. Anil, so, as per the first case, the employee has to close his previous PF account. In other words, at the time of joining, the employee should have withdrawn his previous PF balance. Then only, he can opt for the so-called "Excluded Employee" category. For example, if an employee left the company, had no employment for 2 months, applied for withdrawal, and received the same, then joined another company, this example would be suitable for excluding the employee from PF. If an employee is joining immediately from previous employment, he can't opt for excluding the PF.
In the case provided by Mr. Arun, the employee is currently holding his previous PF account. So, he cannot opt for the "Excluded Employee" category.
From India, Chennai
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In the case provided by Mr. Arun, the employee is currently holding his previous PF account. So, he cannot opt for the "Excluded Employee" category.
From India, Chennai
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Thank you, Mr. Saravanan and Mr. Anil Raina, for the valuable inputs. My own appreciation of this case (that the employee cannot opt out of PF until he withdraws his existing PF account) has been reinforced by your inputs.
As regards Mr. Saravanan's suggestion that I open a fresh UAN for him, will the employee be able to link his existing UAN to the new UAN (remember there will be a mismatch in Date of Birth between the two UANs)? I guess I will have to leave it to him and his previous employer to deal with and sort out the issues in his existing UAN.
From India, Kochi
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As regards Mr. Saravanan's suggestion that I open a fresh UAN for him, will the employee be able to link his existing UAN to the new UAN (remember there will be a mismatch in Date of Birth between the two UANs)? I guess I will have to leave it to him and his previous employer to deal with and sort out the issues in his existing UAN.
From India, Kochi
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Provident Fund - Excluded Employee - Definition.pdf
What is Employee Provident Fund.docx