Sec-12 of provident fund act-1952
Ananta Karad
(Querist) 23 April 2013
This query is : Resolved
Dear All,
Sec-12 of the Act provides that an employer in relation to an estblishment to which any scheme or the insurance scheme applies shall not reduce whether directly or indirectly wages of any employees to whom this scheme or the insurance scheme applies or the total quantam of beneifit the nature of old age pension , gratuity or PF to which employees is entitled under the terms of his employment express or implied. But the above reductions by the employer shall not be made for the reason only of his liablity for the payment of any contribution to the fund or the insurance fund or any charges under this Act or the scheme or the insurance scheme. That means any reduction made by the employer for any other reason not specifically provided in Sec-12 of the Act is not prohibited.
is means that If suppose my in hand gross salary is 25k per month without any PF contribution and in case employer wants to implement PF contribution then it shoud be deducted form my gross in hand salary or the employer should bear this cost or increse my per month CTC for both contribution (employer and emploee)?
Please appraise as am geeting confusion of Sec-12 of PF Act-1952.
Thanks & Regards,
Ananta Karad
Raj Kumar Makkad
(Expert) 23 April 2013
First of all ensure whether the appointment letter contains the facility of EPF to you or not because you come within the exempted employee within the rules of EPF & MP Act, 1952 and if the employer has provided this facility to you then the deduction of your share shall be made out of your gross salary and equal contribution shall be made by employer.
Ananta Karad
(Querist) 24 April 2013
we have not mentioned PF and other deduction in appointment letter as we have mentioned only Gross salary and his montly earning, so........ shall we deduct PF contribution from employees gross?..correct na...
And same contribution would made from Employer end.
H.M.Patnaik
(Expert) 24 April 2013
Dear Mr. Karad,
In case your establishment is a covered establishment under EPF & MP Act, 1952 , you have to pay Employees share of EPF contribution from your Gross pay and the Employers will also deposit matching contribution along with EDLI and admn. charges as per provision of the Act. Employers contribution forms part of CTC .
Raj Kumar Makkad
(Expert) 24 April 2013
The maximum limit for the wages for the purpose of EPF is Rs. 6500/- and the rate of percentage is 12. The basic wages, the food concession, the retaining allowance and dearness allowance form part of the wages. Thus legally a contribution of Rs. 780/- against en employee in the above noted method is to be made apart from administrative changes.
