EPFO Tips: What to do if your employer is defaulting on its contribution towards your account? Know these 5 rights

How do you recover your Employees’ Provident Fund (EPF) amount from a defaulting employer? If you are an account holder with the Employees’ Provident Fund Organsiation (EPFO), you must keep a tab on the contributions made in your account by your employer.

A member contributes 12 per cent of his basic salary towards his EPF and an equal amount is deposited by the employer. The contributions are made upfront by the employer.

The annual Provident Fund (PF) statement of Account/Member Passbook will indicate the amount paid by the employer. By looking at the Passbook, you can determine the periods of default from the employer.

If the member has activated his/her UAN (Universal Account Number), the payment or non-payment of contributions can be verified every month through e-passbook.

The EPFO also sends messages to the accountholders on their registered mobile number on credit of monthly contributions in their PF accounts.

In case, the employer fails to carry out his obligations, the account holder has a remedy that he can avail. The EPFO can invoke penal provisions of the Act to recover the dues from the employer. Complain can also be lodged with the police under section 406/409 of IPC by the EPFO for action against such employers.

If your employer ceases to pay his dues towards contribution to your EPF account, he is liable for prosecution under Section 14 of the EPF & MP Act, 1952. The accounts of the employer, property could be attached. He could also be arrested or detained.    

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5 facts on Employers’ contribution to your EPF accounts:

1) An employer cannot deduct his share of contribution from the wages of employees. It is not permissible and any such act is a criminal offence.

2) Wages cannot be reduced by the employer on account of payment to the EPF. It is barred under Section 12 of the EPF & MP Act, 1952.

3) An employee is entitled for full interest on the belated deposit of PF dues by the employer. After realising the dues, the employer must pay interest in full for each due month and it will in no way affect the interest on the contribution made by the member.

4) Employer is not liable to pay contributions if he is not in service or has left the organization.

5) The provident fund amount due to the employee will be paid only to the extent of the amount released by the employer.