The Employees Provident Fund and MP Act, 1952
Employee's Provident Fund (EPF) is a benefit scheme for salaried individuals for their old age after their retirement. It is not only tax saving instrument but it also provides security and stability to the employee and his family as well.
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.
- Any other establishment employing 20 or more persons which Central Government may, by notification, specify in this behalf.
- Any establishment employing even less than 20 persons can be covered voluntarily under section 1(4) of the Act.
Any person who is employed for work of an establishment or employed through contractor in or in connection with the work of an establishmentNEW AMENDMENTS EFFECTIVE FROM 1st September 2014 EPF is now mandatory for all those whose salary is less than Rs.15, 000
Previously the limit was Rs.6, 500. However, this now rises to Rs.15, 000. Therefore, whoever falls below Rs.15, 000 of salary per month will have to contribute compulsorily to EPF Scheme.EPS contribution from employer raised
Earlier whether your salary was Rs.6, 500 or at a higher level, employers used to contribute fix EPS contribution of Rs.541 i.e. 8.33% of Rs.6, 500. This is increased now to Rs.1, 250 i.e. 8.33% of Rs.15, 000.The minimum monthly pension will be Rs.1, 000 per month.
Under the new rules, widow of a member will get a minimum monthly pension of Rs.1, 000. For children it fixed at Rs.250 and the orphans it is Rs.750 per month. In addition, to arrive at pension, salary will be average of 60 months last drawn salary instead of earlier rule of last 12 months average salary.Insurance coverage to member increased to Rs.3, 00,000
Earlier each member who is part of the EPF scheme had an insurance coverage of Rs.1, 56,000. This insurance coverage has now risen to Rs.3, 00,000.Please note that Salary for this purpose means Basic along with Dearness Allowance.
Table below gives the rates of contribution of EPF, EPS, EDLI, Admin charges in India.
|Scheme Name||Employee Contribution||Employer Contribution|
|Employee provident fund||12%||3.67%|
|Employees Pension scheme||0||8.33%|
|Employees Deposit linked insurance||0||0.50%|
|EPF Administrative charges||0||1.10%|
|EDLIS Administrative charges||0||0.01%|
Labour Law Consultancy
- The Shop and Establishment Act, 1948
- The Labour Welfare Fund Act, 1953
- The Employees Provident Fund and MP Act, 1952
- The Employee State Insurance Act, 1948
- The Profession Tax Act
- The Payment of Gratuity Act, 1972
- The Payment of Bonus Act, 1965
- The Maternity Benefits Act, 1961
- The Minimum Wages Act, 1948
- The Payment of Wages Act, 1936
- The Equal Remuneration Act, 1976
- The Contract Labour (Regulation and Abolition) Act, 1970
- The Apprentices Act, 1961