The Provident Fund Office has allowed companies to cap their per-month Provident contribution to employees at Rs. 6,500. At present, companies contribute an amount equal to at least 12 per cent of an employee’s basic salary towards his/her PF. Now When an employer is deducting and depositing Employees’ Provident Fund contributions upon more than the prescribed salary, he can reduce  it to Rs. 6,500 per month and in that event, section 12 of the Employees’ Provident Funds & Mis­cellaneous Provisions Act providing bar for not to reduce wages will not be attracted.

Full Text of the Circular is as follows:- 

EMPLOYEES PROVIDENT FUND ORGANISATION

MINISTRY OF LABOUR AND EMPLOYMENT, GOVERNMENT OF INDIA, DELHI

Ref. No. LC(637)2009/Vol.I/203- Dated: 27.05.2014

 Subject: Filing of Review Petition against judgement of Hon’ble Supreme Court of India in SIP No. 1205/2009 in the matter of Marathwada Gramin Bank Employees Union Vs. Management of Marathwada Gramin Bank – regarding.

Reference:  This office letter No. LC-2(637)2009/MH/12780 dated 08.10.2013

Please refer to the above Cited letter wherein views on the issue of filing Review Petition/implementation of the order dated 09.09.2011 of the Hon’ble Supreme Court of India in SLP No. 1205/2009 in the matter of Marathwada Gramin Bank Karamchari Sangathan & Ors. Vs. Management of Marathwada Gramin Bank, were called for.

2. The views expressed by the Zonal Addl. Central Provident Fund Commissioners as to whether review petition need to be filed or not has been examined at Head Office. Having analysing the pros and cons of the issue, Competent Authority felt that there is no point in going for review against the said judgement of Hon’ble Supreme Court of India.

3. All the Regional Provident Fund Commissioners-In-charge of Regional /Sub-Regional Offices are, therefore, directed not to force employers to contribute over and above the statutory wage ceiling in respect of their employees. However, option is available for the employees to contribute beyond the statutory wage ceiling if they so desire subject to the conditions enumerated under para 26(6) of the Employees’ Provident Funds Scheme, 1952.

Yours faithfully,

(P.K.UDGATA)

Addl. Central Provident Fund Commissioner (Compliance)

Tei.: 011-26172672

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0 responses to “Companies CAP Provident Fund (PF) contribution to Rs. 6500”

  1. Sandeep says:

    HI,

    I don’t want avail PF facility but my company is enforcing. How can I rid of it and if not, is there a minimum deduction I can have? please help me.

    Thanks
    Sandeep

  2. Lakshmipathy G says:

    Hi sir,

    I am receiving Rs.20,000/- gross salary and my company deducting Rs.780/- as PF deduction is it correct.

    They have to deduct 12% from my full basic and not from the 6500/-.

    Need your guidence for this.

  3. Surendra Kataria says:

    Dear P.K.UDGATA,
    Could you tell to us one employee can close our pf service to an employer and how employee received 12% contribution through employer ?

  4. Raviprakash says:

    12% of Rs.6,500/- i.e. Rs.780/-

  5. harshita gupta says:

    If employee’s basic salary is more than rs. 6500 p.m. then what is the min. amt. should be deducted towards employee’ pf contribution if employee is registered member under PF

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