Employees Provident Fund: Employees’ PF accounts are opened under the Employees’ Provident Fund Organization. Under this account, both the employer i.e. the company and the employee have to pay the contribution. In such a situation, if the company or employer does not contribute to this account or makes a delay, then under certain conditions it may have to pay a fine.
According to a decision given by the Supreme Court in February 2022, it is mandatory for the employer to cover the damages if there is a delay in the Employees Provident Fund (EPF) contribution. The employees are liable to pay interest under section 14B and section 7Q of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.
How much penalty will have to be paid for not depositing money
If an employee delays from 0 to 2 months, then he will have to pay a penalty of 5 percent per year. Similarly, 10 percent per annum will have to be paid for a delay of 2 to 4 months, 15 percent per annum for a delay of 4-6 months. The Employees’ Provident Fund Organization said that the loss is limited to 100 per cent of the outstanding amount.
How much amount has to be deposited in pf account
Under the Employees’ Provident Fund and Miscellaneous Provisions Act 1952, the employee has to contribute 12% of the basic salary and the same amount is deposited in the employee’s PF account by the company. Out of the 12 per cent contribution of the company, 8.33 per cent is deposited in the Employees’ Pension Scheme and the remaining 3.67 per cent in the EPF account. In this way, a total of 24 per cent of the salary of the employee is contributed towards his EPF account.
Explain that if the Employees Provident Fund Organization is such an organization, which collects retirement funds for the employees and also gives benefits of facilities like pension on retirement.
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