MASTER OF SOCIAL WORK II YR

PRESENTATION ON THE EMPLOYEE PROVIDENT FUND & MISCELLANEOUS PROVISIONS ACT, 1952 (EPF & MP SCHEMES)

SYNOPSIS

The Employees Provident Fund & Miscellaneous Provisions Act, 1952: Objects of the Act; Applicability/Non-Applicability of the Act; Features of the Scheme.

Employees Pension Scheme, 1995: Purpose of the Act; Quantum of Contribution; Formula to calculate Pension Fund.

Employees Deposit Linked Insurance Scheme, 1976: Features of the scheme; Benefit to nominee of employee;

Composition of Central Board of Trustees. Determination of Contribution payable.

Appeal against the order of the officer.

Employees Own Provident Fund Account authorization. Transfer of accounts. Penalties. Power of Inspectors.

Conclusion.

OBJECT OF THE ACT:

o

To provide retirement benefit to the employees in the form of lump sum amount and also provide for a pension scheme to the employee & his family. Following schemes are covered under the Act by Central Government: The Employees Provident Fund & Miscellaneous Provisions Act, 1952. Employees Pension Scheme, 1995.

Employees Deposit Linked Insurance Scheme, 1976.

APPLICABILITY OF THE ACT

Every establishment which is a factory engaged in any industry specified in Schedule I to the Act and in which 20 or more persons are employed. (10 employees w .e .f 9 Nov 2010) Any other establishment or class of establishment employing 20 or more persons which may be specified by Central Government by notification in official gazette. Central Government can also apply provisions of the Act to any establishment employs less than 20 persons. Even if the provisions of PF Act are not applicable in a particular establishment, if employer and majority of employees agree, the Central Provident Fund Commissioner can apply the provisions to that establishment by issuing a notification in official Gazette. Once the provisions of Act become applicable, it continues to be applicable even if number of employees fall below 20.

NON-APPLICABILITY OF THE ACT

Any establishment registered under Cooperative Societies Act or State Law relating to Cooperative societies, employing less than 50 persons and working without paid of power.

To any establishment belonging to or under Control of Central Government or State Government

To any establishment set up under any Central or State Act

Any other establishment newly set up until the expiry of 3years

The Employees Provident Fund Scheme, 1952

Central Government through notification in the Official Gazette frames a Scheme for establishment of provident funds for the employees of the establishment.

The Fund shall vest in & be administered by the Central Board of Trustees and Executive Committee

FEATURES OF THE SCHEME

QUANTUM OF CONTRIBUTION: The employers and employees contribution is 12% each. The employers contribution to the Provident Fund will be 10%/12% of the Pay ( i . e Basic Wages +D . A + Retaining Allowance) The Central Government is empowered to increase the rate of contribution to 12% by way of notification in the official Gazette.

Employee earning more than Rs.6,500 per month is eligible for availing this scheme.

DIVERSION TO PENSION SCHEME: Out of employers contribution of 12% the employers contribution of 8.33% will be diverted to Employees Pension Scheme. The balance will be retained in the EPF Scheme. Thus, on retirement, the employee will get his full share plus the balance of employers share retained to his credit in EPF account. INVESTMENT: The amount received by way of Provident Fund Contributions is to be invested by the Board of Trustees in accordance with the investment pattern approved by the Government of India. The members get interest on the money standing to the credit at a rate recommended by the Board of Trustees approved by the Government of India

EMPLOYEES PENSION SCHEME,1995

Purpose of this Scheme:

To provide Superannuation scheme, retiring pension or permanent total disablement pension to the employees of the establishment to whom the Act applies. To provide widow or widowers pension, children pension or orphan pension payable to the beneficiaries of such employees.

Quantum of Contribution to the Pension Fund:

Such sums from the Employers contribution to EPF Scheme as may be specified in the Pension Scheme. However the sum shall not exceed 8.33% of the Pay (Basic Wages+ D. A +Retaining Allowance), balance-3.67% as the case may be, will be credited in employees name in Provident Fund account.

Monthly Pension=Pensionable Salary*(Pensionable Service+2)/70. For e.g. Pensionable service=33 years, pensionable salary= Rs. 5,000, Monthly pension = 5,000*{33+2}/70= Rs. 2,500.

Employees Deposit Linked Insurance Scheme, 1976

Purpose of the Scheme:

To provide Life insurance benefits to the employees of the establishment to whom the Act applies. After the Insurance Scheme has been framed , the Central Government Shall establish a deposit Linked Insurance scheme by way of notification in the Official gazette.
Contribution : Employees : Not required..Employer :(a) 0.50% on Basic + DA (b) Administrative Charges : 0.01% on Basic +DA and retaining allowance(if any)Where the monthly pay of an employee is more than Rs.6,500 the contribution payable in respect of him by the employer is limited to the amounts payable on a monthly pay of Rs. 6,500 only

Benefit to nominee of employee:

The insurance amount is equal to the average balance in the account of the deceased employee in the Provident Fund during a period of 12 months immediately preceding his death. In case the average balance exceedsRs.35,000/- the insurance amount payable is Rs. 35,000/plus 25% of the amount in excess of Rs. 35,000/subject to a ceiling of Rs. 60,000/-.

On the death of an employee while in service a lump sum insurance amount is payable to his nominee or family members.

Statutory Forms Of Provident Fund

Form 5: Employees qualifying for PF for first time (Month Wise) Form 10: Employees leaving the service (Month Wise) Form 12A: Statement of contribution (Monthly) Form 3A: Contribution card for specific currency period(Employee wise) Form 6A: Annual Statement of contribution (Company Wise)Declaration: By the employee Form 2: Nomination and Declaration Form 19: To claim final settlement of Provident Fund by member Form 10C: Claiming withdrawal Benefit/Scheme certificate Form 20: To claim Provident Fund by nominee/legal heir on death of the member. Form 10-D:To claim pension. (In duplicate :if within state, in triplicate: if other state. Form 5IF: To claim assurance benefit under Employees Deposit Linked Insurance nominee/legal heir of a member. Form 31: To claim temporary withdrawal/advance under Employees Provident Fund scheme 52. Form 13: To effect transfer of Provident Fund/Pension from one A/c to another

Composition of Central Board of Trustees.

Chairman & Vice Chairman appointed by Central government.
10 persons representing employers and employees each appointed by Central Government in consultation with organization of employees.

Central provident Fund Commissioner.

Max. 15 officials representing Central Government & State Government each.

APPEAL & EMPLOYERs OWN PF A/C AUTHORIZATION

Appeal against various orders passed under the Act can be made to employees PF Appellate Tribunal. Appeal is entertained only after depositing 75% of the amount demanded.

Appeal :

Employers Own PF A/c Authorization:

An application form provision is made to central Government. The application must be made by employer and majority of employees. The establishment employs 100 or more persons. The establishment hasnt committed any default in the payment of PF contribution or any other offence during 3 years immediately preceding the date of application. The Central Government has authorized the employer by an order in writing to maintain a PF A/C

TERMS & CONDITIONS OF AUTHORIZATION:

Manner of maintenance of PF A/C.

Submission of Returns.

Manner of Depositing the Contribution.

Facilities to be provided for inspection.

Payment of Administrative charges.

Other terms & conditions.

TRANSFER OF ACCOUNTS & PENALTIES

Transfer of A/C:

If the new establishment is covered under PF act;

If the new establishment is not covered under the PF act; If the old establishment was not covered under the PF act. Penalties: Any false statement/ false representation/ avoiding any payment of benefits under the Act- 5 years imprisonment or Rs. 25,000 or both.

POWERS OF INSPECTOR

To collect information & ask to furnish Information on amount recoverable;

Enter establishment at any time and require an employee to produce before him examination any accounts, books, register or documents relating to employment of persons.

Make copies from books, register or other documents in relation to establishment.