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Money Dec 7, 2012

Can you trust your employer with your EPF payments?

By Firstbiz Staff

If you think that your hard earned Employee Provident Fund (EPF) is safe, may be it's time to think again. At least according to a report published in Economic Times today.

The paper reported "that the provident fund department has voluntarily given up its power to take action against employers who fail to deposit workers' dues unless it can name workers whose savings are in danger, evoking protest from union leaders and labour experts who said this could protect companies that fail to make PF contributions."

Employees will now have to prove that their employers deducted the statutory dues while giving them salaries

What's the order: On November 30, former central PF commissioner RC Mishra passed this order, where in enforcement officers cannot act against companies defaulting on workers PF unless specific conditions were met. Moreover, such employers could not be penalized by the departments in case the employers were unable or unwilling to provided the details requested by the departments.

The order also set a seven year limit for probing such default cases, since open-ended assessments and investigations serves no purpose. The paper quoted A Viswanathan, a former PF commissioner saying , "This is a questionable directive and will severely restrict the hands of PF commissioners. It will be virtually impossible for them to establish default if they don't get employee records from companies". Such a limitation period, is not envisaged under the Employees' Provident Fund (EPF) Act of 1952, according to Viswanathan.

Former Rajya Sabha MP and Indian National Trade Union Congress president G Sanjeeva Reddy found this order to be extremely unfair since it would lead to denial of employees' rightful dues.

The report published in ET, however did not have any quotes for RC Mishra. Read the story here.

by Firstbiz Staff

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