1. E MPLOYEE ’ S P ROVIDENT F UNDS AND M ISCELLANEOUS P ROVISIONS A CT, 1952 EPF & MP Act, 1952

2. C ONTENT OF P RESENTATION Background of Law Objective Applicability Contribution Recovery of Money Benefits under PF Offences and Punishment Employee Pension Scheme Employee Deposit linked Insurance Scheme EPF & MP Act, 1952

3. B ACKGROUND O F T HE L AW :- Is enacted to provide a kind of social security to the industrial workers. The security, differs from the security provided to them under the Workmen’s Compensation Act or the Employee’s State Insurance Act. This act mainly provides retirement or old age benefits, such as Provident Fund, Superannuation Pension, Invalidation Pension, Family Pension and Deposit Linked Insurance. This act is intended to provide wider terminal benefits to the industrial workers. For example, the Act provides for payment of terminal benefits in various contingencies such as retrenchment, closure, retirement on reaching the age of superannuation, voluntary retirement. EPF & MP Act, 1952

4. O BJECTIVE :- The main purpose of this scheme is to provide funds for the employees covered by the Employee’s Provident Funds and Miscellaneous Provision Act,1952. As such, the scheme is applicable to the employees of all the factories and other establishment covered by the said Act except those exempted under section 17 thereof and tea factories in the State Assam. EPF & MP Act, 1952

5. A PPLICABILITY OF THE A CT :- To every factory engaged in any industry specified in Schedule 1 to the Act and employing 20 or more persons. To every establishment employing 20 or more persons specified by the Central Govt. in this behalf. Any establishment to which Act applies shall continue to be governed by the Act even if the number of persons employed therein at any time falls below 20. ‘Trainee’ who is an apprentice engaged under the Apprentices Act, 1961 or who is an apprentice according to the certified standing orders applicable to the establishment is excluded from the def. of an employee under the Act. EPF & MP Act, 1952

6. Every employee employed with the work of factory or other establishment covered by the scheme is entitled & required to become the member of the Fund from the date of joining the factory / establishment. The person employed by / through the contractor are included in the definition of “employee” under the Act, and they are covered under the Scheme. “Home Workers” in the beedi industry are also entitled to the benefits of the Act. EPF & MP Act, 1952

7. A CT IS NOT A PPLICABLE TO :- Any factory / establishment registered under any Central or State Law relating to co-operative society, employing less than 50 persons and working without the aid of power. Any establishment belonging to the Central Govt. or State Govt. and having a scheme of contributory provident fund or old age pension. Any establishment set up under any Central or State Act and having a scheme of contributory provident fund or old age pension. EPF & MP Act, 1952

8. C ONTRIBUTION :- By the employer is 12 % of the wages of an employee. Establishment like :- Jute Industry, Beedi Industry, Brick Industry, Coir Industry other than the spinning sector, Gaur Gum Factories – the contribution payable by employer is 10 % of the wages of an employee. Monthly pay of employee exceed Rs.6500 the contribution payable by him, and in respect of employer, shall be limited to the amount payable on a monthly pay of Rs.6500. EPF & MP Act, 1952

9. P.F is to be deducted on the basis of - basic wages - dearness allowance and the retaining allowance if any. Except “House Rent Allowance” other allowance are included in the definition of basic wages. Arrears are the emoluments earned by the employee while on duty and P.F. contribution have to be deducted from such wages. Compound interest, at a rate determined by the Central Govt. from time to time is to be paid on standing to the credit of a member as on 1 st day of April every year. Employer is required to pay administrative charges at the rate of 1.10% of the pay payable to the employees in respect of which PF contribution are payable. EPF & MP Act, 1952

10. R ECOVERY OF M ONEY If any dispute arises regarding the applicability of the Act to an establishment or as to the amount of money due from employer under the Act or any Scheme, the Central Provident Fund Commissioner any Additional Central Provident Fund Commissioner, any Deputy Provident Fund Commissioner, any regional Provident Fund Commissioner, or any Assistant Provident Fund Commissioner may decide the same by holding an enquiry. If any employer pays any contribution or administrative charges for or on behalf of a contractor, he can recover the same from the contractor either by deduction from any amount payable to the contractor under any contract or as a debt payable by the contractor. Contractor then can recover employee’s contribution from the wages of the employee. EPF & MP Act, 1952

11. B ENEFITS UNDER PF:- Following three kinds of benefits are provided under the Scheme:- Withdrawal Benefit Benefit of non-refundable advances Benefit of financing of Life Insurance Policies  Withdrawal Benefit:-  A member can withdraw the full amount standing to his credit in the Fund in the following immediately-  Retirement after attaining the age 55 yrs.  Migration for permanent settlement abroad  Mass retrenchment  Voluntary retrenchment  Closure of establishment  Discharge with payment of retrenchment compensation EPF & MP Act, 1952

12.  Benefit of Non-refundable Advances:-  Non-refundable advances from the amount standing to the credit of a member in the Fund can be sanctioned for the following purposes:-  Purchase of house  Repayment of a loan, for housing  Unemployment due to lock-out or temporary closure  Education of son or daughter  Marriage of self or of daughter, son, sister or brother  Cut in supply of electricity of a factory or establishment  Investment in Varishtha Pension Bima Yojana  Benefits of Financing of Life Insurance Policies:-  This benefit can be available as specified in paragraphs 62 & 67 EPF & MP Act, 1952

13. O FFENCES AND P UNISHMENT :- If any person, for the purpose of avoiding any payment to be made under the Act or the Scheme, knowingly makes any false statement or false representation, he would be punished with imprisonment upto 1 year, or with fine upto Rs.5000/- or with both If any employee makes default in payment of employer’s contribution or the employee’s contribution payable under EPF Scheme, he would be punished with imprisonment upto 3 years but it shall not be less than 1 year and a fine of Rs.10000/- in case of default in payment of the employee’s contribution which has been deducted by the employer from the employee’s wages and six months and a fine of Rs.5000/- in any other case. EPF & MP Act, 1952

14. If any employer makes default in payment of the employer’s contribution or the administrative charges payable under the Deposit Linked Insurance Scheme, he would be punished with year, but which shall not be less than 6 month, imprisonment upto 1 years, plus fine upto Rs.5000/-. If any person contravenes or makes default in complying with any other provision of the Act or any condition for exemption from any scheme, he would be punished with imprisonment upto 6 months but which shall not be less than 1 month and with fine upto Rs.5000/-, or with both. If person convicted of an offence under the Act of the Schemes commits it again, he would be punished with imprisonment upto 5 yrs. But which shall not be less than 2 yrs., plus fine upto Rs.25000/-. EPF & MP Act, 1952

15. E MPLOYEE ’ S P ENSION S CHEME, 1995 Purpose of this scheme is to provide - superannuation pension, retiring pension or permanent total disablement pension to employees covered by Act - widow or widower’s pension, children pension or orphan pension payable to the beneficiaries of such employees. Scheme is applicable to:- - Employees who has been member of the Employee’s Family Pension Scheme, 1971; - Employees who on or after 16-11-1995 become member of Employee’s PF Scheme,1952. - Employee who has been member of the EPF but not being member of the Employee’s family Pension Scheme opt to join the EPS within 6 months from 16-11- 1995. EPF & MP Act, 1952

16. Contribution payable by employer under Sec. 6 of the Act is 8.33%. Central Govt. will also contribute to the Fund at the rate of 1.16% of the pay of members of the Scheme. Where the pay of the member exceed Rs.6500 per month, the contribution payable by the employer and Central Govt. will be limited to the amount payable on his pay of rs.6500 only. If at the option of the employer and employee, contribution paid on salary exceeding Rs.6500/month from the date of commencement of this Scheme of from the date salary exceeds Rs.6500 whichever is later, and 8.33% share of employers thereof is remitted into the Pension Fund, pensionable salary be based on such higher salary. EPF & MP Act, 1952

17. Benefits to the family (on death of the member):-  Widows Pension- a) if member dies while in service b) after leaving service but before attaining age of 58 yrs. And till his death he has not claimed reduced pension after the age of 50 years. c) after commencement of pension on Superannuation / Retirement etc.  In addition to widows pension, two children of the member will get 25% of Widow pension, till the child attains the age of 25yrs.  If wife has predeceased ; the two Orphan children will get 75% of widow pension, as their parents do not exist. EPF & MP Act, 1952

18. T HE E MPLOYEE ’ S D EPOSIT -L INKED I NSURANCE S CHEME, 1976 The purpose of this Scheme is to provide life insurance benefits to the employees of the establishment covered by the EPF & MP Act, 1952. As such, the Scheme is applicable to all employees of all factories and other establishments covered by the said Act. Under this Scheme employee is not required to pay any contribution. Employer is to pay every month contribution at the rate of 0.5% of the total wages of employees covered by the Scheme. In addition employer has to pay administrative charges at the rate of 0.1% of the total wages of the employees covered by the Scheme. EPF & MP Act, 1952

19. If the monthly pay of the employee is more than Rs.6500 the contribution payable in respect of him by the employer (& Central Govt.) is limited to the amount payable on a monthly pay of Rs.6500 only. Benefits under this Scheme:-  On death of employee while in service a lumpsum insurance amount is payable to his nominee or family members.  The insurance amount is equal to the average balance in the account of the deceased employee in the PF during the period of 12 months immediately preceding his death.  In case the average balance exceed Rs.35000/- the insurance amount payable is Rs.35000/- plus 25% of the amount in excess of Rs.35000/- subject to a ceiling of Rs.60000/-. EPF & MP Act, 1952