Type:Preventive Compliance Frequency: Quarterly

Action to be taken:
Ensure that wages or other benefits such as pension, gratuity or provident fund are not being deducted from employees or contract employees in order to pay the employers contribution or administrative charges payable by the employer. (Para 9, EDLIS Scheme)

Audit Requirement:
Are no deductions being made from employees wages in order to pay the employers liability to the funds under the PF Act ?

Supporting Documents:
Written Confirmation of Compliance.

Related Triggers:
Deduction or Fine From Wages
Payment of Wages

Related Keywords:
Conditions of Service
Contributions
Deduction/Fine From Wages
Gratuity
Payment of Wages
Provident Fund
Remuneration/Wages/Compensation

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Related Sections:
Employees Provident Fund and Miscellaneous Provisions Act, 1952
12:Employer not to reduce wages, etc:
No employer in relation to an establishment to which any Scheme or the Insurance Scheme applies shall, by reason only of his liability for the payment of any contribution to the Fund or the Insurance Fund or any charges under this Act or the Scheme or the Insurance Scheme, reduce, whether directly or indirectly, the wages of any employee to whom the Scheme or the Insurance Scheme applies or the total quantum of benefits in the nature of old age pension, gratuity, provident fund or life insurance to which the employee is entitled under the terms of his employment, express or implied. Employees Deposit Linked Insurance Scheme, 1976
9:Employers contribution not to be deducted from the wages of the employees:
Notwithstanding any contract to the contrary, the employer shall not be entitled to deduct the employers contribution payable by him under this Scheme from the wages of the employees or to recover it from them in any other manner. Employees Provident Fund Scheme, 1952
Chapter:Contributions| 31:Employers share not to be deducted from the members:
Notwithstanding any contract to the contrary the employer shall not be entitled to deduct the employer's contribution from the wage of a member or otherwise to recover it from him.


Employees Provident Fund Scheme, 1952
Chapter:Contributions| 32:Recovery of a member's share or contribution:
(1) The amount of a member's contribution paid by the employer or a contractor shall, notwithstanding the provisions in this Scheme or any law for the time being in force or any contract to the contrary, be recoverable by means of deduction from the wages of the member and otherwise :

Provided that no such deduction may be made from any wage other than that which is paid in respect of the period or part of the period in respect of which the contribution is payable :

Provided further that the employer or a contractor shall be entitled to recover the employee's share from a wage other than that which is paid in respect of the period for which the contribution has been paid or is payable where the employee has in writing given a false declaration at the time of joining service with the said employer or a contractor that he was not already a member of the Fund:

Provided further that where no such deduction has been made on account of an accidental mistake or a clerical error, such deduction may, with the consent in writing of the Inspector, be made form the subsequent wages.

(2) Deduction made from the wages of a member paid on daily, weekly or fortnightly basis should be totalled up to indicate the monthly deductions.

(3) Any sum deducted by an employer or a contractor from the wages of an employee under this Scheme shall be deemed to have been entrusted to him for the purpose of paying the contribution in respect of which it was deducted.