THE EMPLOYEES’ PROVIDENT FUNDS AND MISCELLANEOUS PROVISIONS ACT, 1952 provides following sections that the Employer and Employee contributions
6. Contributions and matters which may be provided for in Schemes.—5*** The contribution which shall be paid by the employer to the Fund shall be 6 [ten per cent.] of the basic wages, 7 [dearness allowance and retaining allowance (if any)] for the time being payable to each of the employees 8 [(whether employed by him directly or by or through a contractor)], and the employees’ contribution shall be equal to the contribution payable by the employer in respect of him and may, 9 [if any employee so desires, be an amount exceeding 6 [ten per cent.]of his basic wages, dearness allowance and retaining allowance (if any), subject to the condition that the employer shall not be under an obligation to pay any contribution over and above his contribution payable under this section]:
9 [Provided that in its application to any establishment or class of establishments which the Central Government, after making such inquiry as it deems fit, may, by notification in the Official Gazette specify, this section shall be subject to the modification that for the words 6 [ten per cent.], at both the places where they occur, the words 10[twelve per cent.]
The provision mandates the employer to pay the contribution on behalf of the employer along with employee's contribution. The provision to be interpreted in such a way that the employer shall pay both the employer and employee contribution to the fund and shall recover the employee contribution by deducting from the salary.
The source for the payment of the employee contribution shall be seen in the provision given below:
[8A. Recovery of moneys by employers and contractors.—(1) 12[The amount of contribution (that is to say the employer’s contribution as well as the employee’s contribution in pursuance of any Scheme and the employer’s contribution in pursuance of the Insurance Scheme)], and any charges 13*** for meeting the cost of administering the Fund paid or payable by an employer in respect of an employee employed by or through a contractor may be recovered by such employer from the contractor, either bydeduction from any amount payable to the contractor, under any contract or as a debt payable by the contractor.
(2) A contractor from whom the amounts mentioned in sub-section (1) may be recovered in respect of any employee employed by or through him, may recover from such employee the employee’s contribution 1 [under any Scheme] by deduction from the basic wages, dearness allowance and retaining allowance (if any) payable to such employee.
(3) Notwithstanding any contract to the contrary, no contractor shall be entitled to deduct the employer’s contribution or the charges referred to in sub-section (1) from the basic wages, dearness allowance, and retaining allowance (if any) payable to an employee employed by or through him or otherwise to recover such contribution or charges from such employee.
