The Employees’ Provident Fund and

Miscellaneous Provisions Act 1952

.
 EMPLOYEES’ PROVIDENT FUND ORGANIZATION,
INDIA

 A Statutory Organization under the administrative Control of

Ministry of Labour, Govt. of India.
 Performing the task of enforcing the provisions of the
Employees Provident Fund & Miscellaneous Provisions Act,
1952 and the Scheme framed thereunder.
AND
 Providing service delivery to the members of the Fund and
their family members in accordance with the Scheme.
 EMPLOYEES’ PROVIDENT FUNDS AND
MISCELLANEOUS PROVISIONS ACT, 1952

Schemes Framed and Implemented

Employees’ Employees’ Deposit Employees’

Provident Funds Linked Insurance Pension
Scheme, 1952 Scheme, 1976 Scheme, 1995*
*Scheme,
1971Formerly
Employees’ Family
Pension
 THE EMPLOYEES’ PROVIDENT FUNDS &
MISCELLANEOUS ACT, 1952

 Section 5 of the Act, empowers Central Government to frame

& notify Employees’ Provident Fund Scheme, for the benefit of
employees working in establishments to which the act applies.
 As per Section 5(1A) the fund shall vest in and be administered
by, the Central Board of Trustees constituted under Section 5A
of the Act.
 The Central Board of Trustees administers the fund through its
operational setup viz., The Employees’ Provident Fund
Organization.
 OPERATIONAL STRUCTURE & SOURCE
 The Employees’ Provident Fund Act, 1952 (Since renamed as the Employees’
Provident Funds & Miscellaneous Provisions Act, 1952) enacted by the Central
Government for institution of Provident Fund on contributory basis, for the benefit
of employees working in establishments in Industrial & Commercial sectors.
Over the period, the contributory provident fund system has been enlarged
gradually combining pension and insurance benefits in an integrated manner.
 Central Government notified –
1. The Employees’ Provident Fund Scheme, in 1952;
2. The Employees’ Family Pension Scheme, in 1971 followed by the
Employees’ Pension Scheme in 1995; and
3. The Employees’ Deposit Linked Insurance Scheme in 1976.
[Sec. 5, 6A & 6C]
 Central Board of Trustees, a tripartite statutory body constituted to administer the
funds. [Sec. 5(1A), 6A(4) & 6C(5)]
 THE EMPLOYEES’ PROVIDENT FUNDS &
MISCELLANEOUS PROVISIONS ACT, 1952

Primary objectives for enactment in brief has been :-

 Providing old age / post service financial support / income security to the member /
dependent survivors.

 Assigning employers liability to make contribution in raising the fund for the
benefit of employees and their dependent survivors on compulsory basis.

 Promoting thrift habit amongst employees and enlarging domestic savings base.

 Providing risk free and immunized deposit accretion to the member free from
attachment etc.

 Augmenting resource availability position for national economic development.

I. Applicability

 Applies to establishments belonging to notified category

employing 20 or more persons – (5 employees in case of
Cinema/Theatre establishment and 50 employees in case of Co-
operative Society working without power).

 No infancy protection from September, 1997.

 Provision exist for coverage on voluntary basis for non-applicable

category.

 Central Government empowered to exempt any class of

establishment from the operation of the Act for specified period.
 THE EMPLOYEES’ PROVIDENT FUND & MISC. PROVISION ACT, 1952

The Act shall not apply to :-

a) Any establishment registered under the “Co-operative Societies Act, 1912 or

any other law in force relating to cooperative societies, employing less than 50
(Fifty) Persons and working without the aid of power, or

b) Any establishment belonging to or under the control of the Central or State

Government and whose employees are entitled to the benefits of CPF or old age
pension in accordance with the scheme / rule notified by the central / state
government; and

c) Any statutory body whose employees are entitled to the benefits of CPF / Old
age pension in accordance with the scheme / rule framed under that act
governing such benefits.
 THE EMPLOYEES’ PROVIDENT FUNDS
& MISCELLANEOUS PROVISION ACT, 1952

Applicability:
[Sec. 1(3) of the Act]

Subject to the provisions contained in Sec. 16, the act shall apply:

(a) In every establishment which is a factory engaged in any industry specified in schedule I
in which twenty or more persons are employed, and

(b) To any other establishment employing twenty or more persons or class of such
establishments which the Central Government may, by notification in the official
Gazette, specify in this behalf.

 It is the notification extending the provisions of the scheme to an establishment par se

that attracts his liability and not the service of notice on the employer that has this effect;
it is an absolute and unqualified liability not depending on the vigilance of the
department or on the will of the employer to make the workmen members of the scheme.
 THE EMPLOYEES’ PROVIDENT FUND & MISC. PROVISION ACT, 1952

1. ESTABLISHMENT :
 The term “establishment” has not been defined in the Act, and
consequently, it shall have to be given its ordinary meaning with
reference to the definition of the term “factory”.
[E. Delhi Cloth & General Mills Co. Ltd.
vs.
Regional P.F. Commissioner, U.P.
[1961 (2) LLJ 444]

 Unlike others Acts where either the expression “establishment” or other

words analogous there to are used in conjunction with such expressions
as “in the course of business or trade”, in the Act, the word
“establishment” is not qualified in any way. It only means an organized
which employees certain number of persons and nothing more”.
[Cosmopolitan Club, Madras
vs.
Regional P.F. Commissioner, Madras
[1967 (1) LLJ 797]
II. Membership

 Every employee to be enrolled to the membership of the fund

from day one (eligibility requirement deleted from November
1990 onwards).

 Membership compulsory for all except excluded employees.

 Membership for all the schemes necessary – either of

statutory scheme or exempted scheme.

 Assigned responsibility upon employer of the establishment

for Contractors employees.
 THE EMPLOYEES PROVIDENT FUND SCHEME,1952
( Special provisions for specific class of employees )
==========================================

Para – 83. - Added by G.S.R 706 (E) dated 1st.October, 2008

3. Provides for revised membership enrollment related parameters,

compulsory Membership for all International workers other than an
‘Excluded Employee,’ without voluntary enrollment on joint request

4. Pay ceiling limit for contribution payment liability not provided for.
Contribution payable on total Salary

5. Prescribes separate return submission requirement for International workers.

III. Contribution

 Contribution is payable by Employer and Employee both

equally.
 Employer is required to deposit the contribution and
authorized to recover employees’ share/undertake contract
laborers' liability.
 Basic rate of P.F. contribution – 10%
Higher rate of P.F. contribution – 12%
(Basic rate applicable on 5 Industries namely Beedi, Brick,
Jute, Coir & Guar-gum Industries and establishments
engaging less than 20 employees/sick units).
 Contribution is payable separately for all the three schemes
as prescribed.
 Wage Components not attracting P.F Contribution

1. House Rent Allowance., Overtime Allowance, Bonus Commission or any other similar allowance
payable to the employee in respect of his Employment or work done in such employment.
(Provision u/s 2(b)(ii) of the EPF & MP Act.,’52.)

2. Any presents made by the employer.

(Provision u/s 2(b)(ii) of the EPF & MP Act.,’52.)

3. Any ex-gratia / ad-hoc payment in lump sum as a result of bilateral settlement with unions.
(High Court ruling given in the case Burma Shell Oil Storage & Distributing Co. Ltd.-vs-RPFC, Delhi
[1981(2)LLJ86,] and EID parry (I) Ltd.-vs-RPFC. [1985-FJR-205])

4. Back wages on reinstatement awarded by Courts

(Gujrat High Court ruling given in the case of Swastik Textile Engineers (P) Ltd.-vs-Virijibal
Mavjibhai Rathod & another [2008-LLR-472])

5. Notice Pay / Retrenchment Compensation paid as per law u/s 33(2)(b) of I.D.Act.
(Dinesh Khare-vs-Ind. Tribunal, Rajasthan, Jaipur & others.[1959 LIC.517]
Ghanshyam & Co. – vs – RPFC, Delhi [ 51 FJR 357 ]
RPFC –vs– Southern Alloy Foundry. [1982(1)LLJ.28 ])
IV. Benefit Admissibility

1) Provident Fund Scheme ’52 :

 Lump sum payment of accretion with interest on retirement /
leaving the job.
 Partial withdrawal during job for specified purposes.
2) Deposit Linked Insurance Scheme ’76 :
 Upon death while in service – additional payment in lump sum
equal to average P.F. accretion subject to maximum of Rs. 60,000.
3) Employees’ Pension Scheme, 1995
 Pension to member on retirement / invalidity.
 Pension to Family members on member’s death.
 Not withstanding any contract to the contrary, employers’ share
not to be deducted/recovered from the members.
[Para – 31(1)]

 Members contribution paid by the employer shall be recoverable

by means of deduction from the wages for the relevant
month/period of the member and not otherwise.
[Para – 32(1)]

 Recovery of members’ contribution for past period could be

permitted by the Provident Fund authorities in the event the
recovery is necessitated for bonafide error as a result of (i) false
declaration given in writing by the employee concerned or (ii) for
an accidental mistake or clerical error.
[Proviso under Para 32(1)]

 Deduction of contribution made from the wage of the employee

shall be deemed to have been entrusted for the purpose of
paying the contribution to the fund as prescribed.
[Para – 32(3)]
 OFFENCES UNDER THE EPF & MP ACT AND
SCHEMES THEREUNDER
The following acts on the part of any person/employer constitute offence :

(i) For the purpose of avoiding any payment to be made under the Act or
Scheme by himself or of enabling any other person to avoid such
payments, knowingly making or causing to be made any false statement
or false representations.
(ii) Failure to pay any contribution and/or administrative charges as
specified under para 38 of the EPF Scheme, para 10 of Family Pension
Scheme and para 8 of EDLI Scheme/inspection charges payable under
Section 17(3) and 17(3A) of the Act which he is liable to pay.
(iii) Deductions or attempt to deduct from the wages or any other
remunerations of a member, the whole or any part of the employers’
contributions;
(iv) Failure or refusal to submit any return, statement or other document
required by the scheme or submission of false return, statement or other
document or making a false representation;
(v) Obstructing any Inspector in the discharge of his duties or failure to
produce any record for inspection by such Inspector or other official;

(Section 14 of the Act and para 76 of Employees' Provident Fund Scheme, 1952)
 THE EMPLOYEES’ PROVIDENT FUND SCHEME,
1952
Circumstances in which accumulations in the Fund are
payable to a member by way of final settlement. [Para –
69 of EPF Scheme, ‘52]
Accumulations in the provident fund account of a member
becomes payable for final settlement under following situations:-
(i) On retirement from services after attaining the age of 55 years;
(ii) On retirement as a result of total and permanent disablement
rendering incapable for work;
(iii) Immediately before migration from India for permanent settlement
abroad or for taking employment abroad;
(iv) Termination of service upon mass or individual retrenchment;
(v) Termination of service under a voluntary retirement scheme; and
(vi) Termination of job and remaining unemployed for over two months
or leaving the job from a covered establishment and joining an
establishment not covered by P.F.
 II. Classification & periodicity of existing Returns and
information aspect there against
Form No. Periodicity Purpose
FOR FURNISHING ONE TIME INITIAL INFORMATION
(1) Form 5A Initially once. Details of establishment and the
Subsequently as and when there is owners/Directors etc.
change.
(2) Form 9 Initially once. Updated monthly Details of employees entitled to become
through information furnished in F/5 & member on the date of coverage.
F/10.
PERIODICAL INFORMATIVE RETURNS
(3) Form 5 Monthly New Members added during the month.
(4) Form 10 Monthly Existing members leaving during the
month.
ACCOUNTING RETURNS
(5) Form 12A Monthly Contribution/Adm. Charges under the
three schemes due and remitted by the
establishments.
(6) Form 3A Monthly / Annual Individual subscriber’s Ledger Card –
maintained by the employer –
contribution entered on monthly basis –
closed at the end of the year and sent to
EPFO alongwith F/6A.
(7) Form 6A Annual Consolidated annual statement of
contribution due and remitted in respect
of all the members.
THANK YOU