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Introduction
The Employees Provident Fund was instituted by an
Act of Parliament in November 1952 for providing the social security benefits to the work force engaged in non-government sector.
It provide old-age and post service financial support
to the workers in general employed in Industrial & Commercial Sector establishments. The scheme provided for provident fund system on contributory basis by the Employers and the Employees at equal rate. It made available to the employee concerned the accretions in the Provident Fund a/c with interest in lump sum on retirement or leaving the job.
retrial benefit plan wherein equal contribution at the specified rate is made by the employer and the employee and the same is payable in lump sum on retirement.
deductions
Provident Fund is one of the statutory deduction
Objective
The Employees provident Funds Act, 1952 is enacted
to provide a kind of social security to the industrial workers. The Act mainly provides retirement or old age benefits, to the employee.
The Act provides for payment of terminal benefits in
various contingencies such as retrenchment, closure, retirement on reaching the age of superannuation, voluntary retirement and retirement due to incapacity to work.
any industry specified in schedule I and in which 20 or more persons are employed [sec. 1(3) (a)], and
As per Para 26(2) of the Employees Provident Fund
Scheme, 1952, every employee employed in or in connection with the work of a factory or establishment other than an excluded employee shall entitled and
required to become a member of the Fund from the date of joining the factory or establishment. Employee includes following persons also: (1)Employed by or through the contractor in or in
Excluded Employee
An employee who, having been a member of the fund, has
withdrawn the full amount of his contribution in the fund (a) on retirement from service after attaining the age of 55 years or (b) before migration from India for permanent settlement abroad; or for taking employment abroad
An employee whose pay at the time he is otherwise entitled
Benefits
Employees can take advances / withdraw the PF in case of retirement,
medical care, housing, family obligation, education of children & financing of life Insurance Polices
Up to 90% of the PF amount can be withdrawn at the age of 54 years or
Contribution of Employee
Employees : 12% on Basic + DA Employer :
Formation of PF Trusts
Apart from the financial benefits, some very important benefits become available to employees who are members of voluntary PF Trusts in comparison to the unexempted establishments :
Easy Availability of advances No hassles of Dealing with Public Departments Availability of Refundable advances Faster transfer of accumulations for outgoing members Faster settlement of final dues
Interest
Interest is credited to the members PF A/c on monthly running balance Interest rate is fixed by the Central Government in consultation with the Central Board of trustees of EEPF every year during March / April The present rate of interest is 8.5%
Nomination
The member can nominate other person / persons to
maintained at the Regional Provident Fund Office for use in the event of death of the member
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