EMPLOYEE PROVIDENT FUND ACT, 1952

The Employees Provident Funds and Miscellaneous Provisions Act, 1952, is enacted to provide a kind of social security to the industrial workers and it includes following:

1. Employees Provident Fund Scheme, 1952

2. Employees, Pension Scheme, 1995

3. E.D.L.I. Scheme, 1976

The security, however, differs from the kind of security provided under the Workmen’s Compensation Act, 1923, or Employees’ State Insurance Act, 1948, The Employees’ Provident Funds and Miscellaneous Provisions Act mainly provides for the retirement or old age benefits, such as Provident Fund, Superannuation Pension, Invalidation Pension, Family Pension and Deposit Linked Insurance.

Benefits Under The Act

1. Final withdrawal at the time of Retirement/Leaving of service.

2. Advance for:
(a) Purchase of House
(b) Repair of House
(c) LIC Premium
(d) Marriage of son/daughter, etc.

3. Life-long Pension to the member and to his/her legal heirs after death.

4. Insurance Benefit on members death while in service.

5. Interest of around @ 8.5% on deposits and the same is exempt from income tax.

Eligibility of Employees :

Any employee who is employed for wages in any kind of work of an establishment or employed through contractor in or in connection with the work of an establishment. Present wage ceiling is Rs. 15,000/- p.m. shall be statutorily covered under the Act/Scheme.

Applicability

The Act applies to:

1. Every establishment which is a factory engaged in any industry specified in Schedule I and in which 20 or more persons are employed.

2. Establishment engaged in manufacture, marketing servicing and usage of computer (as defined in clause of sub-section (10 of section 2 of Information Technology Act, (21 of 2000) or deriving any form of output there from or employing it for any type of processing services including software product companies, internet and e-commerce companies, information technology services and remote maintenance companies, research and development companies, systems integrators, on-site service companies and offshore development companies.

3. Any other establishment employing 20 or more persons which Central Government may notify.

4. Any establishment employing even less than 20 can be covered by a specific Central Government notification.

5. A new category of ‘International Employee’ defined under the act bringing foreign nationals working in India under the umbrella of PF Act.

6. Contributions under the act are required to be carried out unless he/she is an ‘excluded employee’ and/or the other country has a reciprocating social security agreement with India.