EPFO bats for PF dues of contract labourers
MUMBAI: The Employee Provident Fund Organisation (EPFO) has made a
passionate plea to India Inc and also to government departments and
public sector undertakings that hire contact labour to ensure that
this segment of the work force does not lose out on its provident fund
(PF) dues.
Typically, when a company hires contract labour through a contractor
agency, it makes a lump sum payment to the contactor which includes
the employer PF contributions. However, cases have been brought to the
notice of the EPFO where such PF dues are in turn not deposited by the
contractor.
Or the contractor bifurcates the wages into basic wages and various
other allowances (which are not within the ambit of basic wages) to
minimize the PF payout.
To illustrate: Company ABC pays Rs 1,000 to contactor agency XYZ. Of
this, Rs 100 is towards employer's contribution to PF. However,
through a bifurcating exercise, the agency XYZ holds that only Rs 60
should be the PF contribution and it pockets the balance Rs 40.
Terming this as a PF pilferage, draft letters to be sent by the EPFO
to major private companies, government departments and PSUs request
that care should be taken to ensure that the contractor agency has a
PF code number and all contract employees are enrolled as members of
the PF scheme.
PF is computed at 12% (for both the employer and employee
contribution) against basic wages. High courts have taken varied views
on which allowances are included for determining the basic wage.
The draft letters reiterate that it is the principal employer (i.e.
the company utilizing contract labourers and not the contactor agency)
who is responsible for its PF obligations, not only in respect of the
employees on its payroll but also those employed by or through a
contractor.
Further, in a recent circular, the EPFO has directed its field staff
to collect details of contract labour engaged through various agencies
(contractors) by government departments, PSUs and the private sector
to ensure compliance.
"The circular is just a reiteration and a reminder to India Inc, as
regards its PF obligations towards contact labour. The online facility
now available to employers to check the status of regular deposit of
PF by their contactor will be a convenient mode of keeping track and
ensuring PF compliance," says Yatin Pathak, chartered accountant.
http://timesofindia.indiatimes.com/business/india-business/EPFO-bats-for-PF-dues-of-contract-labourers/articleshow/24306889.cms
CS A Rengarajan
9381011200
CS Benevolent Fund is a collective effort towards extending the much
needed financial support to the community of Company Secretaries in
times of distress Let us lend support and join for noble cause.
SHARING KNOWLEDGE SKY IS THE LIMIT
This mail and its attachments (if any) are confidential information
intended for persons to whom the email is planned for delivery by the
sender. If you have received this mail in error please notify the
sender of the error by forwarding the email and its attachments (if
any) and then deleting the mail received in error and the relevant
email trail in this connection without making any copies or taking any
prints.
------------------------------------
receive alert on mobile, subscribe to SMS Channel named "aaykarbhavan"
[COST FREE]
SEND "on aaykarbhavan" TO 9870807070 FROM YOUR MOBILE.
To receive the mails from this group send message to aaykarbhavan-subscribe@yahoogroups.comYahoo Groups Links
<*> To visit your group on the web, go to:
http://groups.yahoo.com/group/aaykarbhavan/
<*> Your email settings:
Individual Email | Traditional
<*> To change settings online go to:
http://groups.yahoo.com/group/aaykarbhavan/join
(Yahoo! ID required)
<*> To change settings via email:
aaykarbhavan-digest@yahoogroups.com
aaykarbhavan-fullfeatured@yahoogroups.com
<*> To unsubscribe from this group, send an email to:
aaykarbhavan-unsubscribe@yahoogroups.com
<*> Your use of Yahoo Groups is subject to:
http://info.yahoo.com/legal/us/yahoo/utos/terms/
No comments:
Post a Comment