Employee provident fund act

1. THE EMPLOYEES PROVIDENT
FUNDS & MISCELLANEOUS
PROVISION ACT 1952
Presented by
Dilfiya P.A
FIRST YEAR
MHA

2. INTRODUCTION
• Salary consists of 2 parts i.e .earnings & deduction
• Provident fund is one of the statutory deduction done by the employer at the time of
salary payment .
• Provident fund is governed by the employees provident fund Act 1952.
• An act to provide for the institution of provident funds, pension fund &deposit
linked insurance fund for employees in factories and other establishments .

3. CHAPTER 1 PRELIMINARY
• . Short title and application : This Scheme may be called the Employees’
Provident Funds Scheme, 1952.
• It extends to the whole of India
• 2. Definitions: In this Scheme, unless the context otherwise requires:—
• "Act" means the Employees' Provident Funds Act, 1952 (XIX of 1952);
• "Board" means a Board of Trustees 'constituted under this Scheme;
• "Commissioner" means a Commissioner for Employees' Provident Fund
appointed under this Scheme;

4. CHAPTER -2 BOARD OF TRUSTEES
• The Board of Trustees consists of:
1. Chairman nominated by the Central Government.
2. Three persons nominated by the Central Government.
3. Nominees from State Governments appointed by the Central Government.
4. Six employer representatives nominated by the Central Government in consultation
with recognized employer organizations.
5. Six employee representatives nominated by the Central Government in consultation
with recognized employee organizations.

5. • The State Government's Board includes:
1. Chairman nominated by the Central Government in consultation with the State Government.
2. Two persons nominated by the Central Government.
3. Two persons nominated by the State Government.
4. Four employer representatives nominated by the Central Government in consultation with
recognized employer organizations in the State.
5. Four employee representatives nominated by the Central Government in consultation with
recognized employee organizations in the State.

6. • The Regional Committee comprises:
• 1. Chairman nominated by the Central Government.
• 2. Two persons nominated by the Central Government based on State Government
recommendations.
• 3. Three employer representatives nominated by the Central Government in consultation
with recognized employer organizations in the State.
• 4. Three employee representatives nominated by the Central Government in consultation
with recognized employee organizations in the State.

7. CHAPTER III
APPOINTMENT AND POWERS OF COMMISSIONER AND OTHER STAFF OF BOARD OF
TRUSTEES
• Provident Fund Commissioners:
• Central Board: Commissioner appointed by the Central Government as CEO, subject to its
control.
• State Board: Commissioner appointed by the State Government as CEO, subject to its
control.
• Regional Commissioner: Appointed by the Central Government for a State until a State
Commissioner is appointed, under the control of the Central Commissioner.
• The Commissioner has the authority to approve expenditures within the budget limit of
Rs. 200 per item. Responsibilities include overseeing fund administration, collecting
contributions, settling claims, conducting inspections, ensuring legal compliance, and
taking action against defaulting employers.

8. CHAPTER IV
EMPLOYEES REQUIRED TO JOIN THE PROVIDENT FUND
 Eligibility Threshold: EPF eligibility is based on earning up to a government-set
threshold..
 Industry and Establishment Size: . Establishments with 20 or more employees are
generally covered, but smaller ones may be included based on specific criteria.
 Voluntary Enrollment: While mandatory for eligible employees, Voluntary enrollment is
permitted for those with salaries exceeding the threshold, offering retirement
savings benefits.

9. CHAPTER V
CONTRIBUTIONS
• Contributions : EPF contributions are based on wages and dearness allowance.
• Employee's Contribution: Employees contribute 12%, deducted monthly, toward their EPF
account.
• Employer's Contribution: Employers contribute 3.67% to EPF and 8.33% (up to Rs. 1,250) to EPS.
• Total Contribution: Total contribution is 12% of the employee's basic salary and DA, split between
employee and employer shares.

10. CHAPTER VI
DECLARATION, CONTRIBUTION CARDS AND RETURNS
• Employee Declaration (Form 11): New employees submit Form 11, declaring previous employment and PF details.
• Nomination Declaration (Form 2): Form 2 is used for employees to declare nominees for provident fund benefits in case
of demise.
• Declaration of salary details : Employers regularly declare salary details to EPFO for PF contribution calculations.
• Declaration for withdrawal: Employees can declare PF withdrawal for retirement, resignation, or emergencies.
• Annual PF return :Employers submit annual PF returns to EPFO for compliance.
• Online declaration & services : Online services streamline claims, balance checks, and personal info updates.
• Employee Contribution Card: Employee Contribution Card tracks 12% monthly PF contributions from salary.
• Employer Contribution Card: Employer Contribution Card records employer's 3.67% in EPF and 8.33% in EPS (max Rs.
1,250).
• Annual PF Statement: Annual PF Statement summarizes yearly contributions, crucial for employee tracking.

11. CHAPTER VII
ADMINISTRATION OF THE FUND, ACCOUNTS, AND AUDIT
• Administration Accounts : Central Administration Account records administrative expenses.
• Provident Fund Account: Provident Fund Account holds total employer and employee
contributions.
• Interest Suspense Account: Interest Suspense Account tracks interest, rent, and investment
profits or losses, excluding Administration Account transactions.
• Forms Account :Fund accounts, including Administration Account, maintained as per
specified form by Commissioner with Board approval.
• Audit :Audit follows Central Government instructions in consultation with Comptroller and
Auditor General of India.

12. CHAPTER VIII
NOMINATIONS, PAYMENTS AND WITHDRAWALS FROM THE FUND
• Nomination: A nomination grants the right to receive the amount in case of the account
holders death.
• To determine who should receive the provident fund amount if the account holder passes away.
This provides financial security to the family of the deceased member.
• The account holder can modify or revoke the nomination at any time by submitting a new
nomination form. This is essential, especially when there are changes in family circumstances.
• Withdrawal from EPF :Withdraw EPF in retirement at 58, after resigning or job loss of over
two months, and for medical emergencies.
• Nomination :Nominate a family member for fund receipt in case of demise, update using
Form 2 (Revised).

13. CHAPTER IX
MISCELLANEOUS
Transfer of EPF: Transfer EPF when changing jobs via online portal or Form 13 (Revised)
for continuity.
KYC (Know Your Customer) Verification: Link Aadhaar, PAN, and bank details for KYC
verification.
Interest on EPF: Annual interest credited to EPF, government-determined, usually higher
than bank rates.
EPF Passbook: Monitor balance and transactions with EPF passbook from the EPFO portal.
.

14. BENEFIT
• At, present, employees with salary of rs 7500 are covered under the act .
• Three benefit schemes: provident fund, pension, deposit-linked insurance.
• Provident fund allows non-refundable withdrawals or advances for house construction,
sickness, marriage, education, insurance, unemployment, and calamities.-
• Upon superannuation, full balance with interest is granted.
• Superannuation pension for 20+ years of eligible service, retiring at age 58.
• Retirement pension for 20+ years of eligible service, retiring before age 58.
• Short service pension for 10+ years of eligible service but less than 20 years.

15. • Disablement pension :Lifetime pension for permanent and total disability during
employment, requiring at least 1 month's contribution to the pension fund.
• Widow pension: Monthly pension to the widow in case of death in service or after
superannuation, equal to the employee's pension or 50% of it. Ends at the widow's
death or remarriage, whichever is earlier.
• Children pension: 25% of widow pension for each minor child until age 25 or
marriage (whichever is earlier). Minimum amount: Rs 115 per child.
• Orphan pension: 75% of monthly widow pension for surviving minor orphan
children until age 25. Minimum amount: Rs 170 per child. For female child, until
marriage or age 25, whichever comes earlier.

16. EMPLOYEES PENSION SCHEME
• The Employees Pension Scheme includes:
• A) Superannuation, retiring, or permanent total disablement pension for employees
covered by the act.
• B) Widow or widower pension, children pension, or orphan pension for beneficiaries of
these employees.
• Employees Deposit Linked Insurance Scheme for life insurance benefits:
• Central government frames the scheme for employees of any establishment.
• Employers contribute up to one percent of basic wages, dearness allowance, and retaining
allowance to the Deposit Linked Insurance Fund for each employee.

17. APPLICATION IN HEALTHCARE
• Medical emergencies : employees may be allowed to make early withdrawals from
their PF accounts in case of medical emergencies , where the funds can be used to
cover medical expenses.
• Critical illness: some PF fund schemes may permit withdrawals in the event of a
critical illness diagnosis , allowing employees to use the funds to finance treatment.
• Post retirement healthcare: while not directly in a hospital context ,the funds from
the PF can be used to cover healthcare expenses during retirement , including
hospitalization costs.

18. RECENT AMENDMENTS
• Provided that the Central Board of Trustees shall meet at least twice in each
financial year and the Executive Committee and the Regional Committee shall meet
at least four times in each financial year.” It will come into force on
February 13, 2023.

19. PREVIOUS YEAR QUESTIONS
• When E.P.F Act is applicable to the organization .explain various benefits available
to the members of the EPF scheme together with brief explanation of various
contribution payable under the EPF Act.- ( 20 mark nov 2020 , oct 2015 ,feb 2017 )
• Employee benefit under EPF Act 1952 (5 mark April 2018, feb 2016 )
• Explain the benefits of employees provident fund act 1952 ( 20 mark feb 2014)

20. REFERENCE
• PC TRIPATHI – PERSONNEL MANAGEMENT &INDUSTRIAL RELATION 20TH EDITION
-2009

21. THANK YOU !!!