What EPFO guidelines say when employer fails to deposit contribution in EPF account

In current days, Byju’s has been within the headlines for all of the fallacious causes. the Bengaluru-based ed-tech startup confronted flak for firing individuals in giant numbers, and never paying its workers the provident fund for months. As per media stories, Byju’s has cleared 97% ( ₹123.1 crore) of dues after the EPFO probe into delayed PF funds. Even although Byjus has paid PF now this is what occurs if the corporate would not pay.

What do EPFO guidelines say?

The EPFO pointers mandate that for every month, employers should credit score provident fund funds by the fifteenth of the next month within the account of workers.

What occurs when an employer delays EPF contribution?

To keep away from paying penalties and curiosity, employers should be sure Employee Provident Fund (EPF) contributions are made on time. According to a ruling made by the Supreme Court in February 2022, an employer is required to cowl damages if an worker’s Employees’ Provident Fund (EPF) contribution is delayed.

“Employers defaulting on contributions are liable to pay Damages & Interest on the quantity due,” mentioned EPFO. The retirement fund physique additionally specified the speed at which damages are coated as a result of delayed contributions.

0-2 months 5%

2-4 months 10%

4-6 months 15%

More than 6 months 25%

What can workers do if EPFO contribution is delayed?

“Damages are restricted as much as 100 per cent of the quantity in arrears. The Fund added that 12 per cent annual curiosity is utilized on the quantity due for the whole interval of delay,” EPFO informed via a tweet.

Tax and investment expert Balwant Jain said that if there is any delay in payments by employers, individuals can file a complaint with the EPFO against the employer.

“An inquiry will be initiated by the EPFO against the employers,” mentioned Jain.

EPFO can get well the broken quantity by charging curiosity on the late deposit as nicely, he added.

Amount paid by the worker and employer in EPF

An employer is liable to pay a easy curiosity on the charge of 12 per cent each year, in line with part 7Q of the Employee’s Provident Funds and Miscellaneous Provisions Act, 1952.

How to verify whether or not your employer has deposited EPF contribution

-Employees can verify whether or not their PF contributions are deposited by logging into the EPFO portal.

 -EPFO additionally sends SMS alerts of the fee made within the PF account.

Founded by former trainer Byju Raveendran over a decade in the past, Byju’s, which was as soon as valued at $22 billion, has missed deadlines for submitting its monetary outcomes and paying curiosity on a mortgage.

Catch all of the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint.
Download The Mint News App to get Daily Market Updates.

More
Less

Updated: 28 Jun 2023, 01:07 PM IST