Provident Fund - whether more than 12% mandatory
This query is : Resolved
12 August 2010
Hi,
My friend has got a job offer from a MNC ( IT sector) .He will be having a base pay of Rs 10000. But in the offer letter under retirement benefits, his PF contibution is s hown as Rs 780 only. when he called the company to rectify it to 1200 (10000*12%) they said they have kept it a base of Rs 780 & if he wants to contribute more he can do so but it will be under Voluntary contribution only. My questions are as follows :
1. shouldnt the company deduct Rs 1200 as it is 12% mandatory of base pay?
2. in case he decides to contribute Rs 1500 as Voluntary contribution to PF , is it mandatory for the company to contribute a similar amount ?
3. If the company refuses to contribute a higher amount than Rs 780, can he take any corrective action against them.
Please reply at the earlest. Thanks in advance.
My friend has got a job offer from a MNC ( IT sector) .He will be having a base pay of Rs 10000. But in the offer letter under retirement benefits, his PF contibution is s hown as Rs 780 only. when he called the company to rectify it to 1200 (10000*12%) they said they have kept it a base of Rs 780 & if he wants to contribute more he can do so but it will be under Voluntary contribution only. My questions are as follows :
1. shouldnt the company deduct Rs 1200 as it is 12% mandatory of base pay?
2. in case he decides to contribute Rs 1500 as Voluntary contribution to PF , is it mandatory for the company to contribute a similar amount ?
3. If the company refuses to contribute a higher amount than Rs 780, can he take any corrective action against them.
Please reply at the earlest. Thanks in advance.
12 August 2010
1. Mandatory 12 % of basic pay is correct, but the pay limit is Rs. 6500/- so 6500/- X 12% = 780/-. Deduction above this is optional & that can not be enforced.
2. Employers are liable to contribute to PF similar to that of the employee, but again the limit is 780/- only & above this is only optional.
3. No action can be taken as the company is willing to pay the mandatory amount.
2. Employers are liable to contribute to PF similar to that of the employee, but again the limit is 780/- only & above this is only optional.
3. No action can be taken as the company is willing to pay the mandatory amount.
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