Dear Readers,
Mandatorily
Enabling Mobile No. and Bank Account details of an Insured Person while
registering an Employee under ESI Scheme w.e.f 1st July’2020.
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Showing posts with label Labour Law Update. Show all posts
Showing posts with label Labour Law Update. Show all posts
Wednesday, July 1, 2020
Thursday, May 21, 2020
NOTE ON REDUCTION OF EPF CONTRIBUTION RATE FOR MONTH OF MAY 2020 TO JULY 2020
Dear Readers,
Greetings from Classic Labour!!!!
The
reduction in statutory rate of contributions from 12% to 10% for wage months
May, 2020, June, 2020 and July, 2020 for all class of establishments covered
under the EPF & MP Act, 1952 was announced on 13.05.2020 by the Central
Govt. as part of Atma-Nirbhar Bharat package and same has been notified vide SO
1513 (E) dated 18.05.2020 published in the Gazette of India.
This notification was issued as due to Covid-19 pandemic and lockdown being in force across the country, the Central Government felt that to provide *liquidity* in the hands of employers and employees, there was a need to reduce the contribution rate. Hence it has amended the notification of the Government of India in the Ministry of Labour published in the Gazette of India, Extraordinary, Part II, section 3, sub-section (ii) vide number S.O. 320(E), dated 9th April, 1997;
This original 1997 notification was published in exercise of power conferred under 1st provision of the sec 6 of the EPF & MP Act 1952. Sec 6 is being reproduced below for the readers benefit
*[6.] Contributions and matters which may be provided for in Scheme. –*
The contribution which shall be paid by the employer to the fund shall be ten per cent of the basic wages, dearness allowance and retaining allowance (if any) for the time being payable to each of the employees (whether employed by him directly or by or through a contractor), and *the employee’s contribution shall be equal to the contribution payable by the employer in respect of* and may, if any employee so desires, be an amount exceeding ten per cent of his basic wages, dearness allowance and retaining allowance (if any), subject to the condition that the employer shall not be under an obligation to pay any contribution over and above his contribution payable under this section:
Provided that in its application to any establishment or class of establishments which the Central Government, after making such inquiry as it deems fit, may, by notification in the Official Gazette specify, this section shall be subject to the modification that for the words “ten per cent”, at both the places where they occur, the words “12 per cent“ Shall be substituted:
The original notification of April 1997 created increased contribution the rate from 8.33% to 10% w.e.f. 01-05-1997. However it created an exception in form of schedule II which allowed certain industries to retain earlier lower contribution rate of 8.33%. These rates were further enhanced to 12% and 10% respectively w.e.f. 22-Sep-1997.
Now, a basic question that is being asked by industries all over is – Whether can they as an employer contribute at 12% instead of 10% rate for period May 2020 to July 2020. To answer this query we must visit provisions of voluntary coverage of an establishment u/s 1(4) of the EPF & MP Act 1952. Under these provisions, any establishment which has less than 20 employees can voluntarily apply for obtaining EPF coverage and the PF commissioner may apply provisions of EPF & MP Act to such establishment. It is pertinent to note that since such establishment falls under the exception of the April 1997 notification through *Schedule II - point (I) - Any establishment in which less than twenty persons are employed;*still the EPF accepts its contribution at rate of 12%. This makes it clear that EPFO has mandate to accept higher contribution from employer. Further examples, there are instances that EPF has accepted contributions at rate of 12% from jute industry which comes under the exception of schedule II of the said notification.
So in my considered opinion Schedule II of the said notification is for benefit of certain class of establishments and if the establishment does not want to take the benefit, it can go by its choice of contributing at higher rate. Also the notification of 18-May-2020 was introduced primarily due to covid-19 and lockdown situation where the government wanted to introduce liquidity benefits to the employers and employees. In event the employer and the employees don’t intend to have this liquidity benefit they are free to do so by contributing at higher rates of 12%.
Further it must be noted that employee’s contribution has to be equal to employers. So *if the employer contributes at rate of 12%, the employee is bound to contribute at equal rate.* This is provided in section 6 of the EPF Act and Paqra 29 of the EPF scheme
*Note*
The above reduction of rate of contribution is not applicable to establishments like Central and State Public Sector enterprises or any other establishment owned or controlled by or under control of the Central Govt. or State Govt. These establishments shall continue to contribute 12% of basic wages and dearness allowances.
The reduced rate is also not applicable to the establishments eligible for relief under PMGKY scheme, since the entire employees EPF contributions (12% of wages) and employers’ EPF & EPS contribution (12% of wages) for employees having less than 15000 salary per month , totalling 24% of the monthly wages is being contributed by the Central Govt.
This notification was issued as due to Covid-19 pandemic and lockdown being in force across the country, the Central Government felt that to provide *liquidity* in the hands of employers and employees, there was a need to reduce the contribution rate. Hence it has amended the notification of the Government of India in the Ministry of Labour published in the Gazette of India, Extraordinary, Part II, section 3, sub-section (ii) vide number S.O. 320(E), dated 9th April, 1997;
This original 1997 notification was published in exercise of power conferred under 1st provision of the sec 6 of the EPF & MP Act 1952. Sec 6 is being reproduced below for the readers benefit
*[6.] Contributions and matters which may be provided for in Scheme. –*
The contribution which shall be paid by the employer to the fund shall be ten per cent of the basic wages, dearness allowance and retaining allowance (if any) for the time being payable to each of the employees (whether employed by him directly or by or through a contractor), and *the employee’s contribution shall be equal to the contribution payable by the employer in respect of* and may, if any employee so desires, be an amount exceeding ten per cent of his basic wages, dearness allowance and retaining allowance (if any), subject to the condition that the employer shall not be under an obligation to pay any contribution over and above his contribution payable under this section:
Provided that in its application to any establishment or class of establishments which the Central Government, after making such inquiry as it deems fit, may, by notification in the Official Gazette specify, this section shall be subject to the modification that for the words “ten per cent”, at both the places where they occur, the words “12 per cent“ Shall be substituted:
The original notification of April 1997 created increased contribution the rate from 8.33% to 10% w.e.f. 01-05-1997. However it created an exception in form of schedule II which allowed certain industries to retain earlier lower contribution rate of 8.33%. These rates were further enhanced to 12% and 10% respectively w.e.f. 22-Sep-1997.
Now, a basic question that is being asked by industries all over is – Whether can they as an employer contribute at 12% instead of 10% rate for period May 2020 to July 2020. To answer this query we must visit provisions of voluntary coverage of an establishment u/s 1(4) of the EPF & MP Act 1952. Under these provisions, any establishment which has less than 20 employees can voluntarily apply for obtaining EPF coverage and the PF commissioner may apply provisions of EPF & MP Act to such establishment. It is pertinent to note that since such establishment falls under the exception of the April 1997 notification through *Schedule II - point (I) - Any establishment in which less than twenty persons are employed;*still the EPF accepts its contribution at rate of 12%. This makes it clear that EPFO has mandate to accept higher contribution from employer. Further examples, there are instances that EPF has accepted contributions at rate of 12% from jute industry which comes under the exception of schedule II of the said notification.
So in my considered opinion Schedule II of the said notification is for benefit of certain class of establishments and if the establishment does not want to take the benefit, it can go by its choice of contributing at higher rate. Also the notification of 18-May-2020 was introduced primarily due to covid-19 and lockdown situation where the government wanted to introduce liquidity benefits to the employers and employees. In event the employer and the employees don’t intend to have this liquidity benefit they are free to do so by contributing at higher rates of 12%.
Further it must be noted that employee’s contribution has to be equal to employers. So *if the employer contributes at rate of 12%, the employee is bound to contribute at equal rate.* This is provided in section 6 of the EPF Act and Paqra 29 of the EPF scheme
*Note*
The above reduction of rate of contribution is not applicable to establishments like Central and State Public Sector enterprises or any other establishment owned or controlled by or under control of the Central Govt. or State Govt. These establishments shall continue to contribute 12% of basic wages and dearness allowances.
The reduced rate is also not applicable to the establishments eligible for relief under PMGKY scheme, since the entire employees EPF contributions (12% of wages) and employers’ EPF & EPS contribution (12% of wages) for employees having less than 15000 salary per month , totalling 24% of the monthly wages is being contributed by the Central Govt.
Classic Labour Advisory Services Pvt. Ltd.
Mr Sunil Basakhetre
(Chief Consultant)
Monday, May 18, 2020
Govt. of Maharashtra extended Lock-down - 4.0
Dear Readers,
Government
of Maharashtra has issued the circular DMU/2020/CR.92/DisM-1, on dated 17th
May 2020 for the Extended Lockdown 4.0 valid up to 31st May 2020.
Thursday, May 14, 2020
EPFO - FAQ in regards DSC and e-Sign
Dear Readers,
EPFO
has released a set of frequently asked questions to bring a clarification
regarding employer DSC and e-sign. Refer notification for more detailed
information.
Employer’s DSC e-Sign Registration of Authorised Signatories during Lockdown
Dear Readers,
EPFO
vide press note, keeping in view the COVID-19 situation and to further ease the
compliance procedure has decided to accept KYC attestation, transfer claim
attestation etc. through email also. An employer can send the scanned copy of
the duly signed request letter to the concerned Regional Office through the
mail. Official email addresses of the Regional Offices are available at www.epfindia.gov.in
Extension Of Working Hours For Factories In Uttar Pradesh
Dear Readers,
Government
of Uttar Pradesh vide notification no.No. 13 /2020/ 502 /XXXVI-03-2020- 30
(Sa.)/2020TC has exempted all factories registered under The Factories Act,
1948 in the state from the provision of Section 51 (Weekly Hour), Section 54
(Daily Hour), Section 55 (Interval Of Rest), Section 56 (Spread Hours), Section
59 (Extra wages for overtime) with effect from 20th April 2020 till 19th July
2020 subject to aforesaid conditions.
Conditions
are as below;
·
No
adult worker shall be allowed or required to work in a factory for more than
twelve hours in any day and Seventy-two hours in any week.
·
The
periods of work of adult workers in a factory each day shall be so fixed that
no period shall exceed six hours and that no worker shall work for more than
six hours before he has had an interval for rest of at least half an hour.
·
Wages
shall be in proportion of the existing wages. (e.g. If wages for eight hours
are 80 Rupees, then proportionate wages for twelve hours will be 120 Rupees.
Withdraw increase of Minimum Wages - Punjab
Dear
Readers
Government
of Punjab, as per notification number No.ST/9408 had released the Minimum Wages
for the State effective from 1st March 2020. In pursuance to the same, the
Government of Punjab considering the emergent economic situation arising out of
COVID-19 has issued an order withdrawing the notification number No.ST/9408
published on 1st May 2020 revising minimum wages effective 1st March 2020.
Hence employer may continue to follow the existing minimum wages prevailing
prior to the withdrawn notification until further notice from the Government of
Punjab.
Extension in working hrs. To the employees Under Factories act 1948 - Maharashtra
Dear
Readers,
In
the view of COVID-19 and the available percentages of Factory employees in the
state, Under Sec 65(2) of Factories Act 1948 in Maharashtra State those
factories who are enduring less operational strength of employees, an extension
given to the employees under Sec. 51,52,54 & 56 of Factories Act 1948 up to
30th June 2020;
Monday, May 11, 2020
Central Minimum Wages w.e.f. April-2020
Dear
Readers,
The
Ministry of Labour and Employment published Central minimum wages revised,
w.e.f. April-2020. Find below revised Minimum Wages notification.
Tuesday, April 28, 2020
Set aside MHA, Maharashtra govt orders compelling payment of full wages during Covid lockdown: Textile company moves SC
Dear Readers,
Greetings from
Classic Labour!!!!
In the
continuation of the below link, The
petition filled by Mumbai based Textile Company in Supreme Court on Govt. of
Maharashtra regarding compelling payment of full
wages during Covid-19 lockdown.
Now Supreme Court
grants Centre Two weeks to show how it will implement MHA Order directing
payment of full wages during COVID-19 lockdown.
Friday, March 27, 2020
Fiance Minister announced a relief package in EPFO for Employer as well as Employee
Dear All,
Greetings!!!!
Finance Minister announced Very important announcements made for people facing difficulties due to this Lock-down,
Finance Minister Nirmala Sitharaman announced a relief package. Major impact in EPF of Employee and Employer.
For organised sector workers;
1. Government of India will pay the EPF contribution - both for employer and employee (@12%) - for the next three months so that nobody suffers due to loss of continuity in the EPFO
contribution. This is only for all those establishment who have up to 100 employees, and 90% of
Greetings!!!!
Finance Minister announced Very important announcements made for people facing difficulties due to this Lock-down,
Finance Minister Nirmala Sitharaman announced a relief package. Major impact in EPF of Employee and Employer.
For organised sector workers;
1. Government of India will pay the EPF contribution - both for employer and employee (@12%) - for the next three months so that nobody suffers due to loss of continuity in the EPFO
contribution. This is only for all those establishment who have up to 100 employees, and 90% of
who draw Rs 15,000
salary per month.
2. Provident Fund scheme’s regulations will be amended to allow non-refundable advance of 75%
2. Provident Fund scheme’s regulations will be amended to allow non-refundable advance of 75%
of the amount standing to the
credit of the person, or three month of wages whichever is lower;
This will benefit 4.8 crore workers.
We shall keep you posted about Any further modification / amendment in the above orders
This will benefit 4.8 crore workers.
We shall keep you posted about Any further modification / amendment in the above orders
Friday, March 20, 2020
BMC orders private companies to Completely Shutdown as Coronavirus count rises
Dear Readers,
In continuation to
the earlier BMC’s circular of dated 17th Mar’2020; now there is a
latest update received on 20th Mar’2020 from Municipal Commissioner
of MCGM; wherein it states that
“All private,
Corporates and establishments to be completely shut down".
Wednesday, March 18, 2020
ESIC Allowed to file Non remitted employees ESI contribution for the period of Apr'19 to Sept'19 up to 15th Mar'2020
Dear All,
Greeting!!!!!
Please find attached ESI Notification, now ESIC Allowed to file Non remitted employees ESI contribution for the period of Apr'19 to Sept'19 up to 15th May'2020.
According to the notification, ESIC has been given one time opportunity (One time relaxation) to those Employers who did not file ESI Contribution for the period of Apr'2019 to Sept'2019 within 42 days after end of contribution period. And now Employers are allowed to file this contribution up to 15th Mar'2020.
Further, it is made clear that -
1. This one-time relaxation is limited to the contribution period
ending September, 2019 only and no further relaxation in limitation
for other contribution period is allowed.
2. Such relaxation is not extended to other older or new contribution period.
Greeting!!!!!
Please find attached ESI Notification, now ESIC Allowed to file Non remitted employees ESI contribution for the period of Apr'19 to Sept'19 up to 15th May'2020.
According to the notification, ESIC has been given one time opportunity (One time relaxation) to those Employers who did not file ESI Contribution for the period of Apr'2019 to Sept'2019 within 42 days after end of contribution period. And now Employers are allowed to file this contribution up to 15th Mar'2020.
Further, it is made clear that -
1. This one-time relaxation is limited to the contribution period
ending September, 2019 only and no further relaxation in limitation
for other contribution period is allowed.
2. Such relaxation is not extended to other older or new contribution period.
BMC orders private companies to work only at 50% of capacity as Coronavirus count rises
Dear Readers,
Government of
Maharashtra has issued an order under Section 2,3 & 4 of the Epidemic
Disease act 1897 framed regulation for prevention and containment of COVID-19
under No. Corona 2020/CR/58/Aarogya - 5 dated 13/Mar'2020
The following order is allowing to all the non essential
service providing offices including Private as well as Public companies,
Corp-orates and establishments to work only at 50% of capacity of staff to
attend office on any day due
to rising count of CORONA-VIRUS
Monday, March 16, 2020
Maternity Benefit Act 1961
Dear Readers,
The
Government of Kerala have decided to extend all the provisions of the Maternity
Benefit Act, 1961
(Central Act 53 of 1961) to the private educational institutions including
unaided schools inclusive
of teachers in the State of Kerala.
Tuesday, February 25, 2020
Maharashtra Security Guard board - Revised Special Allowance/Dearness Allowance & HRA
Dear Readers,
Greetings!!!!!!!
In Maharashtra, under Maharashtra Security Guard Board act Special Allowance/Dearness Allowance & HRA has been revised for the period of 1st January'2020 to 30th June'2020.
Thursday, February 6, 2020
Maharashtra Minimum wages revised VDA (Special Allowance) notification w.e.f. January-2020
Maharashtra Minimum wages revised VDA notification w.e.f. January - 2020
Dear Readers,
Greetings!!!!!!!
In Maharashtra, under Shop and Establishment Act Dearness Allowance (V.D.A) has been revised for the period of January'2020 to June'2020.
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