Last post June 12, 2010 04:09 AM by Janak Soni. 1 repiles.
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.
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.
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.
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.