How do you check that your Employer is depositing your EPF contribution?
What can an employee do if his employer is not depositing EPF money to EPFO or trust. Many companies deduct contribution towards PF from their employees’ salaries but do not deposit this with their trust or with EPFO.
Employees think that company is deducting EPF and he can get it on resigning or retirement. But when they find out that there is no retirement corpus they thought they were accumulating, hell breaks loose when they. Employee don’t know their account balance, they do not know how to deal with a defaulting employer or how to fight for their right?
PF subscribers whose accounts have not been credited with deducted money can complain to EPFO or labour ministry.
Recently, the Employees Provident Fund Organisation (EPFO) asked nearly 300 exempted private provident fund trusts to send their pending income tax exemption proposals by November. All these trusts had been exempted on a ‘deemed’ basis so far. And, these may get approval if, among other reasons, they have been regular with submission of provident fund money deducted from their employees’ salaries.
Says a Bangalore-based regional provident fund commissioner (RPFC), “The companies which have been irregular with payments to the provident fund (PF) account in the Trust may not be allowed to continue with the exemption. Of course, this is not the only reason for discontinuing exemption. This is a good way to catch irregular companies.”
The EPFO website has a list of the top 50 defaulters — Ramky Infrastructure, Hyderabad (Total default = Rs 39.15 crore between April 2009 and March 2011), HMT Watches, Dehradun (Total default = Rs 30.3 crore between July 2004 and January 2008), Ahluwalia Contracts India, Delhi (Total default = Rs 54.57 crore between September 2007 and March 2009) and Madhya Pradesh State Road Transport Corporation, which has various amounts pending at different EPF offices across the state.
Many companies which deduct contribution towards PF from their employees’ salaries do not deposit this with their trust or with EPFO. These companies continue this for years at length, while most employees aren’t aware of it. One day hell breaks loose when they find out there is no retirement corpus they thought they were accumulating.
EPFO says if a company is found to be non-compliant with its PF deposits, it will not only have to pay the dues but also pay an interest penalty on the same, depending on the number of days of delayed payment. If the delay if for less than two months, then the interest payable will be five per cent yearly above the amount payable for the number of days of delay in making payment. Similarly:
If two months and above but less than four months = 10 per cent a year
If four months and above but less than six months = 15 per cent a year
If six months and above = 25 per cent a year
If you still find your employer has not deposited the deducted PF with the trust or EPF, you can file a complaint with either RPFC or a criminal case against your employer with the police or complain to the chief vigilance officer appointed by the labour ministry. You need to produce a copy of your salary slip to show the deduction, which does not reflect in the account balance. “Most employees do not know these ways of dealing with a defaulting employer. They don’t even know their account balance. Hence they don’t know if to put in the time to fight for it. At the same time, these redressal processes take their own time and don’t guarantee recovery all the time,” says an RPFC.
To know if your employer is depositing your EPF contribution you can ask for a copy of Form 12, which gives the details of money deducted from an employee’s salary. Employers need to send this form to EPFO towards the end of each month. “But, employers may decline to furnish Form 12 to employees,” says the RPFC. You could also file a Right to Information application to the regional EPFO. You need to mention your EPF account number and your employer code.
To check that Your Employer is depositing your EPF contribution ?
If you want to be sure that your EPF contribution has been deposited to EPFO (Employee Provident Fund Office) by your employer, here are some of the ways to check it online
E passbook – It contains all the transactions of your EPF account. So any amount deposited by employer to EPFO will get recorded here. It has complete information for your each month’s contribution. It gets updated in batches and in most of the cases it is outdated . Also if you are recent joinee, there won’t be any record available in E passbook.
UAN passbook
UAN passbook
SMS to those who have registered UAN: Once you have register the universal account number, every month when you and your employer contribute to your EPF account, you will receive an SMS alert from the EPFO. This will be similar to the SMS alerts you receive every time your bank account is credited or debited. You can even check your total balance by downloading the EPF passbook. However, this facility is not available to employees of exempted establishments at present.
SMS says “Dear member (UAN <10 digit UAN number>), Rs xxxxx for 02/2016 has been credited in your EPF account. For details download m-epf mobile app from Google Play Store“
EPFO Website – Provident Fund website has a way to find out the monthly PF deposit made by a company. One can easily use this information to verify if one’s EPF money is being deposited regularly to EPFO.
Please note that you can’t find the exact money deposited on your behalf here as the money shown is the total for all employees in the company. This data is available only for companies who are submitting the EPF money using the E-Challan and Receipt (ECR) facility. To check this, please go to Establishment Information Search.
This you can find at EPF Website www.epfindia.gov.in ->Our Services->Employers->Establishment
Details can be searched through part of establishment name and/or establishment code number(only 7 digits). For e.g., when I searched on “Infosys” as shown below, I got 24 records of different establishments.
Once you get the establishment you are looking for, click on the View Details
Scroll down and click on the View Payment Details.
icon or the Key icon towards the end of the row.
When I clicked on the “Payment” icon of the second row, I got all the records of “INFOSYS LIMITED” related to EPF deposits done electronically. It shows details like “Date of Credit” of EPF money to EPFO, the “No. of Employees” for whom the money has been deposited, and the total “Amount” credited for all those employees. Below are the example screenshots
EPF Contribution if Employer has financial problems
ABC Ltd. has not deposited provident fund contributions in lacs, say 20 lakhs to the authorities, but accounted in the books? When can it be caught.
Company Auditor who audits Company’s financial book has to make sure that company is depositing the provident fund contributions.The auditor’s report under CARO, 2003 has to specifically state whether the company is regular in depositing provident fund dues with the appropriate authority and, if not, the extent of arrears of provident fund shall be indicated by the auditor. The auditor may also ascertain the period since which dues have not been paid. In this case, the failure of ABC Ltd. to deposit provident fund of Rs. 20 lacs will be reported by the auditor in CARO, 2003 issued u/s 227(4A) of the Companies Act, 1956. In indicating the arrears, the period to which the arrears relate should preferably be also given.
During the course of audit of ABC Ltd. it is noticed that out of Rs12 lakhs of provident fund contribution accounted in the books, only Rs 2 lakhs has been remitted to the authorities during the year. On enquiry the Chief Accountant informed that due to financial problems they have not remitted but will remit the same as and when the position improves?
The Companies Audit Report’s Order, 2003 required the auditor to state whether the undisputed dues of provident fund have been regularly deposited with the appropriate authorities and, if not, the extent of the arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable, shall be indicated by the auditor. In this case there is a default in not depositing the provident fund contribution to the extent of Rs 10 lakhs which is a lapse on the part of the company. The reason put forward by the Chief Accountant that the amount has not been deposited due to financial problems faced by the Company is no excuse for not remitting the provident fund. In fact, the company has not at all been regular in depositing the amount. Thus, the auditor shall include this in his report indicating the extent of arrears.
What happens to the payment of contribution to provident fund an an employee when company has no money and has become insolvent?
According to Section 11 of the Employees’ Provident Fund and Miscellaneous Provisions Act 1952, if the employer is adjudged as insolvent or if the employer is a company and an order winding thereof has been made, the amount due from the employer whether in respect of the employee’s contribution or employer’s contribution must be included among the debts which are to be paid in priority to all other debts in the distribution of the property of the insolvent or the assets of the company. In other words, this payment will be a preferential payment provided the liability thereof has accrued before this order of adjudication or winding up is made
EPF Withdrawal if company has Financial Problems
Often Employers don’t accept the PF withdrawal form saying that they cannot pay PF due to financial problems. The financial problems of the company have nothing to do with PF. The employer has to deposit PF money to EPFO after deduction from salary.
When the employer receives the PF withdrawal form, the employer should submit the PF forms to concerned PF office with in 5 days. It should supply the acknowledgement issued by PF office to employee. Companies should use effective mode of communication post,courier,email,SMS.
Please keep proof of submission of PF forms to company and an acknowledgement by company even if by email mentioning that your PF forms have been received. So that company may not claim forms are not received or are not traceable.
If the Employer has not Deposited the EPF contribution to EPFO or trust then what can an Employee Do
Many companies deduct contribution towards PF from their employees’ salaries but do not deposit this with their trust or with EPFO. Employees think that company is deducting EPF and he can get it on resigning or retirement. But when they find out that there is no retirement corpus they thought they were accumulating, hell breaks loose when they. Employee don’t know their account balance, they do not know how to deal with a defaulting employer. or how to fight for what they thought was theirs. What can an employee do if his employer is not depositing EPF money to EPFO or trust.
My previous employer has yet not deposited the sum that was deducted towards my provident fund. In fact, they haven’t opened a PF account. It’s been six months since I left the firm but I haven’t got my money.How can I claim it?
It is an offence to deduct provident fund and not deposit it. The financial problems of the company have nothing to do with PF. If company has been depositing employer’s and employee’s contribution regularly with PF office the funds are in the control of PF office and not employer. The PF amount, if not deposited with the PF department, then only your previous employer can be held liable to pay.
To know if your employer is depositing your EPF contribution you can ask for a copy of Form 12, which gives the details of money deducted from an employee’s salary. Employers need to send this form to EPFO towards the end of each month. But, employers may decline to furnish Form 12 to employees. You could also file a Right to Information application to the regional EPFO. You need to mention your EPF account number and your employer code.
If you still find your employer has not deposited the deducted PF with the trust or EPF then you can do following
You can file a criminal case against your employer. You file a written complaint against your employer in the local police station.
You can also take this up with the provident fund department by sending an email to cvo@epfindia.gov.in. To furnish a written complaint in your regional PF office, you can get the relevant contact details at http:www.epfindia.com.
You can complain to the chief vigilance officer appointed by the labour ministry. You can email at cvo@epfindia.gov.in .
You can approach your regional PF inspector for action against your employer.
Please ensure that for all complaints you produce your salary slips showing PF deduction and your employer’s name, address and, if possible, PF registration number.
EPFO says if a company is found to be non-compliant with its PF deposits, it will not only have to pay the dues but also pay an interest penalty on the same, depending on the number of days of delayed payment. If the delay if for less than two months, then the interest payable will be five per cent yearly above the amount payable for the number of days of delay in making payment. Similarly:
If two months and above but less than four months = 10 per cent a year
If four months and above but less than six months = 15 per cent a year
If six months and above = 25 per cent a year
Please note that these redressal processes take their own time and don’t guarantee recovery all the time.
KingFisher & EPF Problems
Vijay Mallya, caught up in controversy for leaving India in the middle of a massive loan default is facing probe from several agencies including Enforcement Directorate. Under fire over dues totalling over Rs 9,000 crore of long-grounded Kingfisher in unpaid loans and interest, Mallya left the country on March 2 2016.
Kingfisher Airlines employees sought the intervention of Prime Minister Narendra Modi for non-payment of salary and provident fund dues by Vijay Mallya. The Employees’ Provident Fund Organisation (EPFO) said the company has no pending PF and that it has not received a single complaint from any employee of the now-defunct airline.
According to Labour Ministry, Kingfisher Airlines Ltd is registered as employer with EPFO since January 1, 2005. The last inspection in 2012 revealed the company has paid EPF and other dues on salary payable up to December 2012. Kingfisher Airlines contributed to the PF in March 2012 for 6,185 employees. The PF compliance to the number of employees have gradually reduced to 3,339 in the month of December 2012,.
The employment strength of Kingfisher Airlines reduced after December 2012 due to closure of its operations and remittances were made for two skeletal employees up to September 2015 and thereafter minimum administrative charges were paid. The payment of EPF contribution stopped after September 2015 as it was found that Form 10, which states the date and reason for exit of employees from employment or EPFO membership, was not submitted by the company.
The ministry said a total of 5,675 PF claims were settled from 2012-13 to the employees of Kingfisher airlines. Also, it added that Provident Fund has been in respect of 12 deceased employees.
Retirement fund body EPFO has constituted a squad of enforcement officers to investigate issues related to payment of PF dues by the beleaguered Kingfisher Airlines. Notices have been issued to the company for penal damages (Rs 3,34,016), interest dues (Rs 3,55,678) for bleated remittances for certain months and payment of short remittances of Rs 71,910, involving a total liability of Rs 7,61,604.
