EMPLOYEE PROVIDENT

FUND & MISCELLANEOUS

ACT 1952
Abhishek Nagre

Abhisheknagre777@gmail.com

EPF ACT 1952

The Employees' Provident Funds and Miscellaneous Provisions Act, 1952
came into effect on 4 March 1952
3 schemes come under this
1
2
3

Employees' Provident Fund Scheme, 1952

Employees' Deposit Linked Insurance Scheme, 1976
Employees' Pension Scheme, 1995 (replacing the Employees' Family
Pension Scheme, 1971)
The act came into immideate
effect from 14 - 3 - 1952

he total assets under management at more than

lakh crore (US$91 billion) as of 1 May 201

EMPLOYEES' PROVIDENT FUND

ORGANIZATION OF INDIA

2
3

Statutory body of the Government of India under the Ministry of Labor and
Employment
The headquarters of the organization is in New Delhi
It administers a compulsory contributory Provident Fund Scheme, Pension
Scheme and an Insurance Scheme.
It is one of the largest social security organizations in the India in terms of the
number of covered beneficiaries and the volume of financial transactions
undertaken
The total assets under management at more than INR 5 lakh crore
(US$91 billion) as of 1 May 2013
The organization is administered by a Central Board of Trustees, composed

of representatives of the Government of India, provincial governments,

employers and employees
The board is chaired by the Union Labor Minister of India.

EPF Organization
For every political state they have
Additional Central Provident Fund
Commissioner

Additional Central Provident Fund

Commissioner

The states have either one or more than one

Regional Offices headed by Regional P.F.

Commissioners (Grade I)

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.F. Commissioners (Grade I)

which are further sub- divided into SubRegions

Regional P.F.
Commissioners (Grade
II)

Regional P.F.
Commissioners (Grade
II)

WHAT IS EPF
The EPF (Employees' Provident Fund) is the most popular investment for
salaried individuals
and is maintained solely by the Employees' Provident Fund Organization of India
(EPFO).
RULE :
A part of the employees salary is benefitted to this scheme which can be
withdrawn by the employee in later stages for his purpose Security , Help
during dire circumstances

As

a rule, any company having more than 20 employees has to

register with the EPFO

CONTRIBUTION RATES

SECTION 6

The contribution is made by both

Employer and the employee
Contribution as described in law
The contributions payable by the employer under the Scheme shall be at the rate
of [ten per cent] of the [basic wages, dearness allowance (including the cash value
of any food concession) and retaining allowance
Rate of 12 %
Rate of contribution shall be [twelve] per cent in respect of any establishment or
class of establishments which the Central Government may specify in the Official

Gazette from time to time

Employees contribution

The contribution payable by the employee under the Scheme, shall be equal to the
contribution payable by the employer in respect of such employee

Rate of contribution is 10 % usually in the following conditions

1
2
3

Employees are less than 20

The units that are declared sick
Units of Beedi , Jute , Brick , coir

Contribution in excess
In case an employee wants to contribute more than 12 % he is allowed to
do so but the employer is not entitled to contribute the extra percentage

The contributions shall be calculated on the basis of

Basic wages, dearness allowance (including the cash value of any food
concession)
2 Retaining allowance
month whether paid on daily, weekly,
fortnightly or monthly basis
actually drawn during the whole
1

CONTRIBUTION
COMPULSORY ???
Contribution is compulsory
wherein the basic salary is

6500 rupees and if the basic

salary exceeds 6500 rupees
then the membership is taken
upon the joint request of the
employer and the employee

INTEREST PAID
1

2
3

The Commissioner shall credit to the account of each member interest at such rate
as may be determined by the Central Government in consultation with the Central
Board.
At current the interest rate is 8.5 %
Interest shall be credited to the members account on monthly running balances
basis

PENALTY ON NON PAYMENT 32 A

Where an employer makes default in the payment of any contribution to the fund, or in the
transfer of accumulations required to be transferred by him
Imprisonment depending upon non payment up to 3 years with 10 thousand fine
Period of default

Rate of damages
(% of arrears per annum)

Less than two months

17

Two months and above but less than four months

22

Four months and above but less than six months

27

Six months and above

37

COVERAGE
Every establishment which is a factory engaged in any industry mentioned herein,
namely,
1
2
3
4
5
6

cement
cigarettes
Electrical
mechanical or general engineering products
iron and steel
paper and textiles (made wholly or in part of cotton or wool or jute or silk,
whether natural or artificial)

be deemed to have come into force, with effect from 2nd day of September, 1952
and which employees 20 or more persons

EXEMPTIONS SECTION 16
This Act shall not apply
(a) to any establishment registered under the Co- operative Societies Act, 1912 (2 of 1912 ),
(b)to any other establishment belonging to or under the control of the Central Government
or a State Government
(c) to any other establishment newly set up, until the expiry of a period of three years from
the date on which such establishment is, or has been, set up

Right from day one

The act comes in to enactment from the very day of the company's
establishment or commencement of business except some class
establishments which are mentioned under section 16 of the act

Once applied

The Act once applied will continue to apply even after the employees
number comes down to below 20
employed 5 or more than 5
employees
Applicable to cinema theaters that have

MEMBERSHIP
1

Right from the day of establishment

Membership is offered to employees working part time / full
time and temporary /contractual employees
Compulsory for people having basic pay of Rs 6500
If basic pay exceeds Rs 6500 then it is granted by the request
from the employer and the employee

VOLUNTARY COVERAGE
Section 1 [4]
If any company / establishment which does not come under coverage
wants to enroll for the membership it can do so by the consent of the
employer and the consent obtained by the majority of the employees

WHAT DOES ACT COMPLY TO

1

2
3

Coverage of the possible coverable establishments according to the rules laid

down
Extending membership to all the employees who work in the establishments
that get registered
Ensuring proper implementation of act and the schemes thereof

REGISTRATION PROCESS
1

Upon registration the company / establishment is issued with registration

number or code number
Issued by the regional provident fund commissioner of the particular
region the establishment belongs to
Code number is usually issued within 3 days on submission of the
requisite documents
The members - as in the employees are assigned a separate PF account
number for life long reference

DUTIES OF EMPLOYER
1

2
3
4
5
6

Enroll all employees including contractual or contracted

employees and hourly rated employees
Remit
contributions and administrative charges before the
th
15 of the following month
Filing of the initial returns form 9
Monthly returns filing with the help of form 12 A
Make all records available for the inspection of the authority
Ensure continuous payment to prevent penalties

BENEFITS OFFERED UNDER

SCHEME
Payment of accumulation plus interest on the eve of retirement resignation
or death Partial withdraws are permitted for special purposes
1
2
3
4
5
6
7

Financing life insurance policies

Acquiring house or site
Marriages of self or dependents
Education of children
Treatment of illness
Purchase of any equipment by physically handicapped persons
Financial assistance on lockout or discharge of duties