Good Evening ... I need brief information regarding Voluntery Provident Fund. shree
From India, Bangalore
From India, Bangalore
There are two views about the term 'voluntary' in the context of EPF. First, introducing PF by an employer to whom the Act does not apply. That is, the firm has an employment strength of less than 20, the present limit, but wants to have PF coverage (voluntarily and not statutorily).
Second, a member of PF wants to contribute more than the rate of contribution specified in the Act. That is, as per the Act 12 % is the statutory rate of contribution by an employee. As against this 12%, an employee wants to contribute a higher percentage voluntarily. There is no restriction for higher (voluntary) contribution by a member. But the employer need not contribute at such higher rate but his contribution shall be limited to 12%.
Regards,
Madhu.T.K
From India, Kannur
4249Second, a member of PF wants to contribute more than the rate of contribution specified in the Act. That is, as per the Act 12 % is the statutory rate of contribution by an employee. As against this 12%, an employee wants to contribute a higher percentage voluntarily. There is no restriction for higher (voluntary) contribution by a member. But the employer need not contribute at such higher rate but his contribution shall be limited to 12%.
Regards,
Madhu.T.K
From India, Kannur
1. Short title extent and application
(1) This Act may be called the Employees' Provident Funds and Miscellaneous Provisions Act 1952.
(2) It extends to the whole of India except the State of Jammu and Kashmir.
(3) Subject to the provisions contained in section 16 it applies
(a) to every establishment which is a factory engaged in any industry specified in Schedule I and in which twenty or more persons are employed and
(b) to any other establishment employing twenty or more persons or class of such establishments which the Central Government may by notification in the Official Gazette specify in this behalf :
Provided that the Central Government may after giving not less than two months' notice of its intention so to do by notification in the Official Gazette apply the provisions of this Act to any establishment employing such number of persons less than twenty as may be specified in the notification.
(4) Notwithstanding anything contained in sub-section (3) of this section or sub-section (1) of section 16 where it appears to the Central Provident Fund Commissioner whether on an application made to him in this behalf or otherwise that the employer and the majority of employees in relation to any establishment have agreed that the provisions of this Act should be made applicable to the establishment he may by notification in the Official Gazette apply the provisions of this Act to that establishment on and from the date of such agreement or from any subsequent date specified in such agreement.
(5) An establishment to which this act applies shall continue to be governed by this Act notwithstanding that the number of persons employed therein at any time falls below twenty.
2A. Establishment to include all departments and branches
For the removal of doubts it is hereby declared that where an establishment consists of different departments or has branches where situated in the same place or in different places all such departments or branches shall be treated as parts of the same establishment.
. Power to apply the Act to an establishment which has a common provident fund with another establishment
Where immediately before this Act becomes applicable to an establishment there is in existence a provident fund which is common to the employees employed in that establishment and employees in any other establishment the Central Government may by notification in the Official Gazette direct that the provisions of this Act shall also apply to such other establishment.
5. Employees' Provident Funds Scheme
(1) The Central Government may by notification in the Official Gazette frame a Scheme to be called the Employees' Provident Funds Scheme for the establishment of provident funds under this Act for employees or for any class of employees and specify the establishments or class of establishments to which the said Scheme shall apply and there shall be established as soon as may be after the framing of the Scheme a Fund in accordance with the provisions of this Act and the Scheme.
(1A) The Fund shall vest in and be administered by the Central Board constituted under section 5A.
(1B) Subject to the provisions of this Act a Scheme framed under sub-section (1) may provide for all or any of the matters specified in Sch. II.
(2) A Scheme framed under sub-section (1) may provide that any of its provisions shall take effect either prospectively or retrospectively on such date as may be specified in this behalf in the Scheme.
6. *Contributions and matters which may be provided for in the Scheme
The contribution which shall be paid by the employer to the Fund shall eight and one-third per cent of the basic wages dearness allowances and retaining allowance (if any) for the time being payable to each of the employees (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 if any employee so desires and if the Scheme makes provision therefore be an amount not exceeding eight and one-third per cent of his basic wages dearness allowances 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;
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 "eight and one-third per cent" at both the places where they occur the words "ten per cent" shall be substituted :
Provided further that where the amount of any contribution payable under this Act involves a fraction of a rupee the Scheme may provide for the rounding off of such fraction to the nearest rupee half of a rupee or quarter to a rupee.
Explanation 1 : For the purposes of this section dearness allowance shall be deemed to include also the cash value of any food concession allowed to the employee.
Explanation 2 : For the purposes of this section retaining allowance means an allowance payable for the time being to an employee of any factory or other establishment during any period in which the establishment is not working for retaining his services.
Bare Act - Employees Provident Fund and Miscellaneous Provisions Act, 1952
Rajesh Patil
9850 03 7870
From India, Coimbatore
(1) This Act may be called the Employees' Provident Funds and Miscellaneous Provisions Act 1952.
(2) It extends to the whole of India except the State of Jammu and Kashmir.
(3) Subject to the provisions contained in section 16 it applies
(a) to every establishment which is a factory engaged in any industry specified in Schedule I and in which twenty or more persons are employed and
(b) to any other establishment employing twenty or more persons or class of such establishments which the Central Government may by notification in the Official Gazette specify in this behalf :
Provided that the Central Government may after giving not less than two months' notice of its intention so to do by notification in the Official Gazette apply the provisions of this Act to any establishment employing such number of persons less than twenty as may be specified in the notification.
(4) Notwithstanding anything contained in sub-section (3) of this section or sub-section (1) of section 16 where it appears to the Central Provident Fund Commissioner whether on an application made to him in this behalf or otherwise that the employer and the majority of employees in relation to any establishment have agreed that the provisions of this Act should be made applicable to the establishment he may by notification in the Official Gazette apply the provisions of this Act to that establishment on and from the date of such agreement or from any subsequent date specified in such agreement.
(5) An establishment to which this act applies shall continue to be governed by this Act notwithstanding that the number of persons employed therein at any time falls below twenty.
2A. Establishment to include all departments and branches
For the removal of doubts it is hereby declared that where an establishment consists of different departments or has branches where situated in the same place or in different places all such departments or branches shall be treated as parts of the same establishment.
. Power to apply the Act to an establishment which has a common provident fund with another establishment
Where immediately before this Act becomes applicable to an establishment there is in existence a provident fund which is common to the employees employed in that establishment and employees in any other establishment the Central Government may by notification in the Official Gazette direct that the provisions of this Act shall also apply to such other establishment.
5. Employees' Provident Funds Scheme
(1) The Central Government may by notification in the Official Gazette frame a Scheme to be called the Employees' Provident Funds Scheme for the establishment of provident funds under this Act for employees or for any class of employees and specify the establishments or class of establishments to which the said Scheme shall apply and there shall be established as soon as may be after the framing of the Scheme a Fund in accordance with the provisions of this Act and the Scheme.
(1A) The Fund shall vest in and be administered by the Central Board constituted under section 5A.
(1B) Subject to the provisions of this Act a Scheme framed under sub-section (1) may provide for all or any of the matters specified in Sch. II.
(2) A Scheme framed under sub-section (1) may provide that any of its provisions shall take effect either prospectively or retrospectively on such date as may be specified in this behalf in the Scheme.
6. *Contributions and matters which may be provided for in the Scheme
The contribution which shall be paid by the employer to the Fund shall eight and one-third per cent of the basic wages dearness allowances and retaining allowance (if any) for the time being payable to each of the employees (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 if any employee so desires and if the Scheme makes provision therefore be an amount not exceeding eight and one-third per cent of his basic wages dearness allowances 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;
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 "eight and one-third per cent" at both the places where they occur the words "ten per cent" shall be substituted :
Provided further that where the amount of any contribution payable under this Act involves a fraction of a rupee the Scheme may provide for the rounding off of such fraction to the nearest rupee half of a rupee or quarter to a rupee.
Explanation 1 : For the purposes of this section dearness allowance shall be deemed to include also the cash value of any food concession allowed to the employee.
Explanation 2 : For the purposes of this section retaining allowance means an allowance payable for the time being to an employee of any factory or other establishment during any period in which the establishment is not working for retaining his services.
Bare Act - Employees Provident Fund and Miscellaneous Provisions Act, 1952
Rajesh Patil
9850 03 7870
From India, Coimbatore
Once covered, whether voluntarily or statutorily or whether contribution is paid at statutory rate of 12% or at a voluntary higher rate, the rules applicable for withdrawal and transfer are one and the same. Therefore, withdrawal can be made from the fund during the service with the current employer for specified reasons like, advance for construction or purchase of residential house, marriage of self or dependents, loss of property due to natural calamities, non payment of salary by employer for at least two months, medical treatment etc.
Regards,
Madhu.T.K
From India, Kannur
Regards,
Madhu.T.K
From India, Kannur
Dear Mr. Madhu, When can the person apply for PF loan, what is the minimum period of contribution required to apply for Pf loan? kindly clarify. thanks & regards Chitra
From India, Madras
From India, Madras
For taking advance from the fund for different purposes different conditions are specified. If the advance is taken for marriage one should have at least seven years membership. Similarly for construction of residential building five years membership is mandatory.
For post matriculation (higher) studies of member's dependents a minimum service of seven years is required.
If the employee is not paid salary for two months, a certificate to this effect by the employer only is required for taking advance. Similarly, for advance on the ground of loss caused due to natural calamities, a certificate from Village Authorities is required. For advance for medical ground (surgery and hospitalisation for at least one month)a certificate from the ESI that the employee is not covered by ESI is required.
Advance shall also be availed in case of salary reduction due to power cut imposed by the government.
Regards,
Madhu.T.K
From India, Kannur
For post matriculation (higher) studies of member's dependents a minimum service of seven years is required.
If the employee is not paid salary for two months, a certificate to this effect by the employer only is required for taking advance. Similarly, for advance on the ground of loss caused due to natural calamities, a certificate from Village Authorities is required. For advance for medical ground (surgery and hospitalisation for at least one month)a certificate from the ESI that the employee is not covered by ESI is required.
Advance shall also be availed in case of salary reduction due to power cut imposed by the government.
Regards,
Madhu.T.K
From India, Kannur
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
Provident fund.zip
PROVIDENT FUND.rar
PROVIDENT FUND.doc