The Employees’ Provident Funds (And Miscellaneous Provisions) Act, 1952
1. Explain in detail various provision under EPF Act 1952.
1) Meaning of Provident Fund: Sec. 2(e) of the Provident Funds Act 1925 says Provident fund – A fund in which subscriptions or deposits of any class of classes of employees are received and held on their individual accounts, and includes any contributions and any interest or increment accruing on such subscription, deposits or contribution under the rules of the fund.
The Employees’ Provident Funds and Miscellaneous Provisions Act 1952 consists of three schemes viz.
a) Employees’ Provident Fund Scheme, 1952
b) Employees’ Deposit Linked insurance Scheme, 1976
c) Employees’ Pension Scheme, 1995.
2) Applicability: Every establishment which is factory, engaged in any industry specified in Schedule – I and in which 20 or more persons are employed, any other establishment employing 20 or more persons and class of such establishments, which the Central Government may by notification in the official gazette in this behalf.
Case Law:
M. G. Poddar Vs. the Regional Provident Fund Commissioner: It was held a solicitor firm is an establishment and is cover under this Act,
D.A.V. College and another vs. Regional Provident Fund Commissioner and others: It was held that educational institutions are governed by the provisions of this.
This Act does apply to Co-operative Societies and Government Establishments.
3) Contribution [S. 2 (c) ] : According to the amending Act of 1998, both the employees and the employers have to contribute to the Fund, at the Rate of 12% of
i)the Basic Wages
ii) Dearness Allowance and
iii) Retaining Allowance (if any)
payable to the employees per month.
Under the scheme, a salary earner currently contributes 12% of the Salary towards Employees’ Provident Fund and Employee’s Pension Scheme and the employer matches this contribution. Thus, the total contribution of the employer and employee put together is 24% of salary, of this 8.33% is channeled to Employee’s Pension Scheme and the remaining 15.67% is transferred to Provident Fund.
2. Short Note.
1) Employees’ Deposit Linked Insurance Scheme, 1976 [EDL]
This scheme is applicable to all the members of the EPF Scheme 1952. Under this scheme the employer is required to contribute at the rate of 0.5% of the wage of the members on which the provident fund has been paid.
Benefits under EDLI Scheme, 1976 are payable to the person who is entitled to receive the provident fund of the deceased member on the death of the member of the EPF, while being a member of the fund (while in service). This is called assurance benefit.
The claimant or the nominee –
a) is paid an amount equal to the average balance in the account of provident fund during preceding 12 months, or
b) during the period of membership whichever is less.
Where the average balance in the account exceed Rs. 35,000/-, the amount shall be Rs.35,000/- Plus 25% of the amount in excess of Rs. 35,000/- . The maxim benefit amount is Rs. 60,000/- (w.e.f. 24-04-2000)
2) Employees’ Pension Scheme, 1995.
The new entrants to the Employees’ Provident Fund, 1952 will become the member of this scheme automatically on compulsory basis. Employee is not required to contribute separately under the Employees’ Pension Scheme, 1995. Only the employers’ is diverted to pension fund every month on maximum wages up to Rs.6,500/- P.M.
A Person is entitled for pension after completing the age of 58 years with minimum services of 10 years.
The amount of monthly pension shall be computed in accordance will the following Factors,
Pensionable Salary x Pensionable Service
Monthly Member’s Pension = -------------------------------------------
70
The benefits available under this scheme are as follows;
a) Widow’s Pension
b) Childers’s Pension
c) Orphan Pension
d) Disabled Son/Daughter
e) Nominee Pension.
1. Explain in detail various provision under EPF Act 1952.
1) Meaning of Provident Fund: Sec. 2(e) of the Provident Funds Act 1925 says Provident fund – A fund in which subscriptions or deposits of any class of classes of employees are received and held on their individual accounts, and includes any contributions and any interest or increment accruing on such subscription, deposits or contribution under the rules of the fund.
The Employees’ Provident Funds and Miscellaneous Provisions Act 1952 consists of three schemes viz.
a) Employees’ Provident Fund Scheme, 1952
b) Employees’ Deposit Linked insurance Scheme, 1976
c) Employees’ Pension Scheme, 1995.
2) Applicability: Every establishment which is factory, engaged in any industry specified in Schedule – I and in which 20 or more persons are employed, any other establishment employing 20 or more persons and class of such establishments, which the Central Government may by notification in the official gazette in this behalf.
Case Law:
M. G. Poddar Vs. the Regional Provident Fund Commissioner: It was held a solicitor firm is an establishment and is cover under this Act,
D.A.V. College and another vs. Regional Provident Fund Commissioner and others: It was held that educational institutions are governed by the provisions of this.
This Act does apply to Co-operative Societies and Government Establishments.
3) Contribution [S. 2 (c) ] : According to the amending Act of 1998, both the employees and the employers have to contribute to the Fund, at the Rate of 12% of
i)the Basic Wages
ii) Dearness Allowance and
iii) Retaining Allowance (if any)
payable to the employees per month.
Under the scheme, a salary earner currently contributes 12% of the Salary towards Employees’ Provident Fund and Employee’s Pension Scheme and the employer matches this contribution. Thus, the total contribution of the employer and employee put together is 24% of salary, of this 8.33% is channeled to Employee’s Pension Scheme and the remaining 15.67% is transferred to Provident Fund.
2. Short Note.
1) Employees’ Deposit Linked Insurance Scheme, 1976 [EDL]
This scheme is applicable to all the members of the EPF Scheme 1952. Under this scheme the employer is required to contribute at the rate of 0.5% of the wage of the members on which the provident fund has been paid.
Benefits under EDLI Scheme, 1976 are payable to the person who is entitled to receive the provident fund of the deceased member on the death of the member of the EPF, while being a member of the fund (while in service). This is called assurance benefit.
The claimant or the nominee –
a) is paid an amount equal to the average balance in the account of provident fund during preceding 12 months, or
b) during the period of membership whichever is less.
Where the average balance in the account exceed Rs. 35,000/-, the amount shall be Rs.35,000/- Plus 25% of the amount in excess of Rs. 35,000/- . The maxim benefit amount is Rs. 60,000/- (w.e.f. 24-04-2000)
2) Employees’ Pension Scheme, 1995.
The new entrants to the Employees’ Provident Fund, 1952 will become the member of this scheme automatically on compulsory basis. Employee is not required to contribute separately under the Employees’ Pension Scheme, 1995. Only the employers’ is diverted to pension fund every month on maximum wages up to Rs.6,500/- P.M.
A Person is entitled for pension after completing the age of 58 years with minimum services of 10 years.
The amount of monthly pension shall be computed in accordance will the following Factors,
Pensionable Salary x Pensionable Service
Monthly Member’s Pension = -------------------------------------------
70
The benefits available under this scheme are as follows;
a) Widow’s Pension
b) Childers’s Pension
c) Orphan Pension
d) Disabled Son/Daughter
e) Nominee Pension.
