Employees’ Provident Fund & Misc. Provisions Act, 1952

Objective and applicability of the Employees’ Provident Fund & Misc. Provisions Act, 1952 – The EPF & MP Act, 1952 is created for the purpose of social welfare of an employee. Any factory or establishment engaging 20 or more employees, whether directly or through contractors is liable to be covered under this Act.

Basic Wages – The contribution is calculated on the basic wages and dearness allowance but does not include food allowance, house rent allowance (HRA), overtime allowance, bonus, commission etc.

Wage Limit – The wage limit to be covered under this Act is Rs.15,000/- per month.

Quantum of Contribution – The contribution of the employer shall be calculated at 10% of the wages in general and 12% in certain classes of establishment as prescribed by the Central Government. An employee shall pay the equal share of contribution as paid by his employer.

Penalty for Default of Payment by the Employer – An employer is liable to pay damages on being a defaulter. However, this can extend up to imprisonment of 3 years and a fine of Rs.10,000/-

Voluntary Contribution – An establishment having less than 20 employees can also cover itself voluntarily under the EPF & MP Act, 1952 unlike the ESI Act, 1948 which does not allow voluntary coverage.

If you need more information about the Provident Fund, feel free to contact the nearest Labour Law Advocate in Kolkata immediately.


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