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Wages
for two or more classes of work
Where
an employee does two or more classes of work,to each
of which a different minimum rate of wages is applicable,
the employer shall pay to such employee in respect of
the time respectively occupied in each such class of
work, wages at not less than the minimum rate in force
in respect of each such class.
Employers’
Obligations
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The
employer is bound to pay to every employee engaged
in a Scheduled employment under him wages at a rate
fixed for that class of employees in that employment,
without making any deduction therefrom except those
permitted under the Payment of Wages Act.
-
As
a rule, the wages payable under the Act should be
paid in cash.The appropriate Government may, however,
permit the payment of wages wholly or partly in
kind, keeping in view the prevailing custom, and
also allow the supply of essential commodities at
concessional rates.
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If
an employee works on any day in excess of the normal
working hours, the employer shall pay to him overtime
wages for every hour or part of an hour, so worked
in excess, at the rate prescribed under this Act
or under any other law, whichever is higher. As
per Factories Act, overtime wages are to be paid
at twice the normal rate of wages.
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If
any amount payable to an employee as wages or otherwise
under this Act, remains undisbursed on account of
death or his whereabouts not being known, then the
same shall be deposited by the employer with the
prescribed authority.
Provident
Fund : The Employees’ Provident Funds and
miscellaneous provisions Act, 1952
Objectives
The
Employees’ Provident Funds and Miscellaneous Provisions
Act, 1952 aims to provide for the institution of provident
funds, family pension fund and deposit linked insurance
fund for employees in factories and other establishments.
Applicability
The Act applies to:
- every
establishment which is a factory engaged in any industry
specified in Schedule I and in which 20 or more persons
are employed, and
- anyother
establishment employing 20 or more persons or class
of such establishments which the Central Government
may, by notification, specify in this behalf.
The
Central Government may, by notification, apply the provisions
of this Act to any establishment employing such number
of persons less than 20 as may be specified in the notification.
An
establishment to which this Act applies shall continue
to be governed by the Act, even if the number of employees
therein at any time falls below 20.
Exemption
The
Act, however, does not apply to:
- a co-operative
society employing less than 50 persons and working
without the aid of power;
- a newly
set-up establishment for an initial period of 3 years
from the date on which such establishment is, or has
been set up, and
- any
Central/State Government establishment having its
own scheme of provident fund or pension.
The
appropriate Government is empowered to exempt from the
operation of all or any of the provisions of any Scheme:
- any
establishment to which this Act applies if-
- the
rules of its provident fund with respect to the
rates of contribution are not less favourable
than those specified in section, and
- the
employees are also in enjoyment of other provident
fund benefits which on the whole are not less
favourable to the employee than the benefits provided
under the Act or the schemes.
- any
establishment the employees of which are not in enjoyment
of provident fund, pension or gratuity benefits that
are, separately or jointly, not favourable than the
benefits provided under the Act or the schemes.
Voluntary
Coverage
The
employer and majority of employees of an establishment
may agree for the voluntary application of the provisions
of the Act in relation to that establishment. For this
purpose, they should make an application to the Central
Provident Fund Commissioner, who may by notification,
extend the provisions of the Act to that establishment
with effect from the date of such agreement or any subsequent
date specified in such agreement.
The
establishment covered on voluntary basis is required
to comply with the provisions of the Act at par with
other covered establishments and cannot opt out of coverage
on a subsequent date.
Eligibility
Every
employee, including the one employed through a contractor
who is in receipt of wages up to Rs.6,500 p.m. shall
be eligible to becoming a member of the funds.
If
the pay of a member-employee increases beyond Rs. 6,500
p.m. after his having become a member, he shall continue
to be a member but the contribution payable in respect
of him shall be limited to the amount payable on monthly
pay of Rs.6,500.An employee ceases to be a member of
the Employees’ Family Pension Fund at the age of
60 years.
Administrative
Authority
The
Act is administeredboth by the Central Government and
the State Governments in their respective spheres. The
Central Government constitutes a Central Board of Trustees
and in consultation with the State Government, a State
Board of Trustees.
The
Central Government appointsa Central Provident Fund
Commissioner, Deputy/Regional Provident Fund Commissioners
and other officers.The State Board, with the approval
of the State Government, appoints the necessary staff,
for enforcement of the provisions of the Act.
The
Schemes
The
Central Government has framed three schemes under the
Act:
- The
Employees’ Provident Fund Scheme, 1952, for establishment
of provident funds for the employees.
- The
Employees’ Family Pension Scheme, 1971 which
has now been merged into the Employees’ Pension
Scheme, 1995, for providing family pension and life
assurance benefit to the employees.
- The
Employee’s Deposit Linked Insurance Scheme, 1976,
for providing life insurance benefit to employees.
Employees’
Provident Fund Scheme, 1952
The
Employees’ Provident Fund Scheme takes care of
the following needs of the members: retirement, medical
care, housing, marriages, education of children, financing
of insurance policy, etc.
Employees’
Pension Scheme, 1995
The
Government introduced the Employees’ Pension Scheme,
1995 with effect from 16.11.1995. The then existing
Employees’ Family Pension Scheme has been merged
under the new scheme.The new scheme envisages to provide
monthly pension to employees on superannuation, pension
to widows on death after superannuation, monthly pension
for children of the subscribers, monthly pension to
members on account of permanent total disablement during
service, etc.
Employees’
Deposit Linked Scheme, 1976
The
scheme is for providing life insurance benefit to employees.
It is applicable to all the members of the Employees’
Provident Fund Scheme.
Allotment
of Account Number
Every
employee who becomes a member of the Provident Fund/Pension
Fund, shall be allotted an account number by the employer.
Employer’s
Contributions
The
employer is required to contribute the following amounts:
- Towards
Employees Provident Fund and Pension Fund:
- (a)10%
of the basic wages, dearness allowance and retaining
allowance if any, in case of establishments employing
less than 20 persons or a sick industrial (BIFR)
company orsick establishments, or any establishment
in the jute, beedi, brick, coir or gaur gum industry;
- (b)12%
of the wages, D.A. etc. in case of all other establishments
employing 20 or more persons.
- Out
of the contributions payable by the employer each
month, a part of the contribution representing
8.33 per cent of the Employee’s pay shall
be remitted to the Employees’ Pension Fund
and the balancepartshallcontinue to remain in
the Provident Fund account.
- Where
the pay of an employee exceeds Rs.6,500 p.m.,
the contribution payable to Pension Fund shall
be limited to the amount payable on his pay of
Rs. 6,500 only.
- Towards
Deposit-Linked Insurance Fund:
- 0.5%
of the wages, D.A. etc.
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