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Provident Fund Rules And Acts

Provident Fund facility being mandatory for both employees as well as employer in India a number of rules as well as laws have been enacted in order to ensure that all of the activities are administered transparently. In this regard, there are a number of rules and laws, which govern various activities of the organization. First of all various provident fund rules mandates for every employee working in the establishment having more than 20 employees to get membership of the organization by contributing the definite amount in the PF account. As per the provident fund act employer is to registered itself for being the organization just having 20 employees or more than 20. Amount to be paid is 12% of the basic monthly salary. Share of the employer is also up to 13.61% of the total of the wages paid to the employees. Other provided accounts under the provident fund act include that of pension account, retirement account. Other accounts mentioned include that of death or disability account, insurance account etc. A lumpsum amount is paid to the nominee in case of death of the insured.

Main act governing the functions of provident fund in India is The Employees Provident Fund and Miscellaneous Provisions Account, 1952 that came in effect from 4th March 1952. In the Central Board of Trustees there are representative from the Union Government, governments of the provinces. Whole of the board is accountable to the Union Minister for Labor and Employment.

Basic objective of provision of provident fund is enshrined in the Constitution of India. With "Directive Principles of State Policy" directing the states to protect right of the workers for various welfare activities like unemployment allowances, sickness for old age, and disability for the employee etc. there are three main acts governing various PF related matters as EPFS 1952, EDLIS 1976, EPS, 1995.

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