How the Employees' Provident Fund Scheme works:
As per amendment-dated 22.9.1997 in the Act, both the employees and employer contribute to the fund at the rate of 12% of the basic wages, dearness allowance and retaining allowance, if any, payable to employees per month. The rate of contribution is 10% in the case of following establishments:
· Any covered establishment with less then 20 employees, for establishments cover prior to 22.9.97.
· Any sick industrial company as defined in clause (O) of Sub-Section (1) of Section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985 and which has been declared as such by the Board for Industrial and Financial Reconstruction,
· Any establishment which has at the end of any financial year accumulated losses equal to or exceeding its entire net worth and
· Any establishment engaged in manufacturing of (a) jute (b) Breed (d) coir and (e) Guar gum Industries/ Factories. The contribution under the Employees' Provident Fund Scheme by the employee and employer will be as under with effect from 22.9.1997.
Employees' Provident Fund Interest rate:
The rate of interest is fixed by the Central Government in consultation with the Central Board of trustees, Employees' Provident Fund every year during March/April. The interest is credited to the members account on monthly running balance with effect from the last day in each year. The rate of interest for the year 1998-99 has been notified as 12%. The rate of interest for 99-2000 w.e.f. 1.7.'99 was 11% on monthly balances. 2000-2001 CBT recommended 10.25% to be notified by the Government
Others:
a) Applicability:- I
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APPLICABILITY OF EMPLOYEES' PROVIDENT FUND AND MISCELLANEOUS PROVISIONS ACT '1952
The Employees' Provident Fund and Miscellaneous Provisions Act 1952 applies to the whole India except Jammu & Kashmir.
Employees' Provident Fund and Miscellaneous Provisions Act 1952 is applicable to:
- Every establishment which is engaged in any one or more of the industries specified in Schedule I of the Act or any activity notified by Central Government in the Official Gazette. (List of Industries/Establishments)
- Employing 20 or more persons .
- Cinema Theatres employing 5 or more persons.
The Act does not apply to:
- The co-operative societies employing less than 50 persons and working without the aid of power. 16(1)(a)
The establishment to which this Act applies shall continue to be governed by this Act , even if the number of employees falls below 20 at a later date. [ 1(5)].
16(1)(b) Establishments under the control of state/central Govt.& employees who are getting benefits in the nature of 16(1) (b) contributory P.F. or old age pension as per rules framed by the Govt.
16(1)(c) Establishment set up under any central, provincial or state act and the employees who are getting benefits in the nature of contributory P.F. or old age pension as per rules.
Voluntary Coverage
If any of the establishment is not satisfying the above two conditions for coverage and if the employer and majority of the employees are willing , the Act may be applicable to such establishment ( voluntary coverage under section 1(4) )
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