1. Employees’ Provident Funds and
Miscellaneous Provisions Act, 1952
• To ensure compulsory Provident Fund, Employees Pension
Scheme and Deposit Linked Insurance in factories and other
establishments
• Applies to factories and other establishments which employ
20 or more persons
• Employer has to make matching contribution of 10% and
12% of employees pay to Provident Fund account
• Out of the employee’s contribution, 8.33% goes to the
pension fund

2. Applicability
• Every establishment which is a factory engaged in any
industry specified in Schedule 1 and in which 20 or more
people are involved
• Any other establishment employing 20 or more people
which central government may specify by notification
• Any establishment employing even less than 20 persons
can be covered voluntarily under Section 1(4) of the Act
• Once an establishment is covered under the Act it will
continue to be governed by the Act even if the number of
persons employed falls below 20

3. Applicability
Not Applicable To
• Establishments registered under the Cooperative
Societies Act employing less than 50 persons
• Any other establishments belonging to or under control
of state government and whose employees are entitled
to benefit from Provident Fund or old age pension
• Any other establishments set up under any central,
provincial or state act whose employees are entitled to
benefit of contributor Provident Fund or old age pension

4. Central Board of Trustees
• The central board of trustees comprises of chairman, vice chairman,
five central government officials, 15 representatives of state
government, 10 representatives of employers, 10 employee’s
representatives
• The executive committee comprises of chairman, 2 official members
of the board, 3 representatives of the state government, 3
representatives of employers, 3 representatives of employees and
Central Provident Fund Commissioner
• The state board comprises of officers, Central Provident Fund
Commissioner, Financial Advisor, Chief Financial Officer, Additional
Provident Fund Commissioner, Regional Provident Fund
Commissioner, Assistant Fund Commissioner and other employees

5. Delayed Payment
• Employer must pay Period of Default Rate of damages
contributions payable under (Percentage of
EPF and MP Act as well as his arrears per
own before the 15th of following annum)
month
Less than two Seventeen
months
Above two Twenty two
months and less
than four months
Above four Twenty seven
months and less
than six months
Six months and Thirty seven
above

6. Employees of a Contractor
• Responsibility of principal employer to pay contributions
payable in respect of employees of contractor with
administrative charges
• Employer cannot deduct employer’s contribution from
wages or recover it from employee
Declaration at the time of taking up employment
• Employer shall ask a person whether he is a member of
the fund and the Account Number or the particulars of
the previous employer

7. Mode of Payment of Contributions
• Employer will deduct from employee’s wages his
contribution and along with employer’s contribution along
with administrative charges, pay it to the Fund before the
15th of every month
• Payment will be through separate bank drafts or
cheques for contributions and administrative charges
• Within twenty five days of each month, employer will give
a statement of recoveries made from every employee
and the employer’s contributions for each employee
• When employer is adjudicated insolvent, contributions to
fund will take precedence over other debts

8. Protections
• The amount standing to the credit of any member in the Fund shall
not be liable for attachment under order of court
• Only on account of employer’s contribution to the fund, employer will
not reduce the wages of an employee
Features of PF Act
• It is a contributory social security scheme
• Accumulated Fund currently earns 9.5% interest every year added
to Fund
• Employee can withdraw part of his Fund for contingencies like
house repairs, marriage or religious functions
• Fund is managed by Regional Provident Fund Commissioners
• Government exempted establishments to fully manage scheme by
themselves

9. Provisions for Withdrawal
• A member of the fund is authorized to withdraw the full amount
standing to his credit (including employer’s share of contribution) in
the event of retirement after superannuation or on account of total
and permanent incapacity
• Full accumulations may also be withdrawn if an employee (i)
migrates from India for permanent settlement abroad (ii) is
retrenched, or (iii) completes 15 years of membership or (iv) is
suffering from leprosy or TB, or is physically or mentally
incapacitated to work
• On death of a person the full amount standing to his credit is to be
paid to the nominee/family members in prescribed proportions (is no
nominee)/to a person legally entitled to it (if no nominee or family
members)
• Partial withdrawals are also permitted in certain situations like
illness, marriage of employee and dependents, higher education of
children

10. Features of PF Act
• The Regional Provident Fund or exempted employers
are required to invest collected funds strictly according to
the norms laid the Act, which is usually in government
securities
• The Fund on change of job is transferable from one
company to another company any where in India

11. Employees’ Deposit Linked Insurance
Scheme
• The scheme came into force with effect from August 1, 1976
• All members of Employees’ Provident Fund scheme are members of
this scheme as well
• To provide insurance benefits to employees covered under the Act
Contribution
• Employees are not required to pay any contribution
• Employers are required to pay contribution at the rate of 0.5 percent
of employee wages
• Central government contributes 0.25% of employee wages
• Employers are required to pay administrative charges at the rate of
0.01 percent of employee wages

12. Employees’ Deposit Linked Insurance
Scheme
Benefits
• In the event of death of employee, additional amount
equal to average balance in provident fund account
during preceding 12 months
Investment
• Contribution received in insurance fund till March 31,
1997 is kept in the public account of the government of
India
• Pattern of investment is similar to that of provident fund

13. Employees’ Pension Scheme, 1995
• Employees’ Provident Funds Act, 1952 was amended in
1971
• This provided for Employees’ Family Pension Scheme
• Substantial long term protection to family of employee
who may die prematurely in service
• Scheme was later merged in Employees’ Pension
Scheme 1995
• New scheme provides economic sustenance during old
age and survivorship coverage to member and his family

14. Employees’ Pension Scheme, 1995
Coverage
• Coverage extends to all who were part of Family
Pension Scheme, 1971 and Employee’s Provident Fund
from November 16, 1995
• Option to join was given to subscribers who were not
members
• Employees under VRS were allowed to join the scheme
from April 1, 1993

15. Employees’ Pension Scheme, 1995
Finance
• Neither employee nor employer is required to make any
additional contribution
• All accumulations of ceased family fund have been
merged
• Since 1995, the employer share of PF contribution
representing 8.33% of wages have been diverted to fund
• The central government contributes 1.16% of wages to
employees

16. Employees’ Pension Scheme, 1995
• Monthly member’s pension on
superannuation/retirement and short-service pension:
[Pensionable Salary x (Pensionable Service + 2)]/70
• Monthly reduced pension: Reduced at the rate of 3% for
every year the age falls short of 58 years
• The maximum reduction however will be 25%
• Permanent and total disablement pension: Minimum of
Rs. 250 per month payable from date of disablement for
whole life of members
• Provisions for monthly pension for widows, children,
orphans, and to permanently disabled son or daughter