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Clarifications on the PF Act
Human Resources » Industrial Law & Discipline


Chrm Message From: asif Total Posts: 22 Join Date: 18/06/2008
Rank: Executive Post Date: 09/06/2010 14:39:09 Points: 110 Location: United States

Dear All,

I need some clarifications on the PF Act .

Please advise me if we need to deduct PF contribution and professional tax from the stipend of the summer trainees, as per my understanding

trainees are not in the payrolls so this act does not apply to them.

Look forward to your support.

Chrm Message From: benjamin Total Posts: 27 Join Date: 18/06/2008  
Rank: Executive Post Date: 09/06/2010 14:40:32 Points: 135 Location: United States

Dear Asif,

If you are paying stipend as per Apprendice act, they are not covered under PF act and profesional tax...

If you are not showing them on ur pay-roll and then how and where u r showing their names for payment of salary...An enforcement office of PF will check your General Ledger during his inspection on any time and if anywhere he finds that u have paid as salary or stipend without deducting PF, u will be fined for the same. So please take care that also.

So pl note.

Benjamin

Chrm Message From: Malini Raghunath Total Posts: 19 Join Date: 18/06/2008  
Rank: Executive Post Date: 10/06/2010 05:08:34 Points: 95 Location: United States

Hi,

Response to your query, I work for an TATA company & we have nearly 60 apprentices working with us & we have pay them stipend as per the Apprentices Act & no Professonal tax or the PF will be deducted for Apprentices.

You may refer to Apprentices Act in this regard for detailed understanding.

Hope above points will clear your doubts.

Regards..Malini

 

Chrm Message From: Malini Raghunath Total Posts: 19 Join Date: 18/06/2008  
Rank: Executive Post Date: 10/06/2010 05:09:01 Points: 95 Location: United States

Hi,

Response to your query, I work for an TATA company & we have nearly 60 apprentices working with us & we have pay them stipend as per the Apprentices Act & no Professonal tax or the PF will be deducted for Apprentices.

You may refer to Apprentices Act in this regard for detailed understanding.

Hope above points will clear your doubts.

Regards..Malini

 

Chrm Message From: Janak Soni Total Posts: 4 Join Date: 18/06/2008  
Rank: Beginner Post Date: 12/06/2010 04:09:45 Points: 20 Location: United States

There are two things:

You said you have 60 apprentices and they are not on pay-rolls. Both things cannot go together.

They are merely unofficial trainees. They do not come under purview of any Act.

Now, comes Trainees,  If these trainees are inducted under Apprenticeship Act, they are called Apprentices. If so, they are exempted from PF Act. ( But not under ESI, as parliament passed enactment in May 2010 to withdraw exemption and applied ESI to Apprentice)

If they are ordinary Trainees ( taken for increasing skilled manpower  in a company), they have to be a paid Stipend equal to atleast Minimum Wages. PF and ESI will be deductible from their wages. For all purpose, they are like employees. Only difference lies here that trainees do not have employmnt rights, they may be terminated without notice.

 

Hope things are clear now.

 

 
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