Page 260 - DMGT516_LABOUR_LEGISLATIONS

Unit 10: Provident Fund and Gratuity Payment Acts

Under the scheme, the nominees/members of the family of employees of covered establishments Notes
will get, in the event of death while in service, an additional amount equal to the average
balance in the provident fund account of the deceased during the preceding 12 months, wherever
the average provident fund balance is less than 25,000. In cases where the average provident
fund balance of preceding twelve months exceeds 25,000 plus 25% of the amount in excess of
` 25,000, subject to a maximum of 35,000.
There is a provision in the scheme for the exemption of factories/establishments which have an
insurance scheme approved by government and conferring more benefits than those provided
under this statutory scheme, provided that a majority of the employees are in favour of such
exemption. Subject to certain conditions, individual employees or class of employees may also
be granted exemption. The Central Government is the appropriate authority to grant exemption
from the Employees' Deposit-linked Insurance Scheme under Section 17(2A).

Private Provident Fund Scheme

Establishments employing 100 or more persons may opt for a Private Provident Fund Scheme
after getting it approved by the Commissioner u/s 16A. A private scheme shall not be approved,
if it is in any way less beneficial to the employees than the government's scheme, and at least
majority of employees consent to it. A private scheme is usually drawn on the pattern of the
government scheme.

Settlement of Claims within 30 Days

All claims relating to provident fund and pension complete in all respects submitted along with
the requisite documents shall be settled and benefit amount paid to the beneficiaries within 30
days of receipt. Any deficiency in the claim shall be recorded in writing and communicated to
the applicant within 30 days. For any delay beyond 30 days without sufficient cause, interest @
12% p.a. on the benefit amount shall be payable to the beneficiary, which shall be recoverable
from the Commissioner's salary.

Role of Central and Regional Provident Fund Organisations

The Employees' Provident Fund Organisation (EPFO), India is a state sponsored compulsory
contributory pension and insurance scheme. It is one of the largest social security organisations
in the world in terms of members and volume of financial transactions undertaken. The
Employees Provident Fund Organisations is the incharge of all the three schemes. The organisation
functions under the overall superintendence of the policies framed by the Central Board of
Trustees, a tripartite body consisting of the chairman's, nominees of the Central and State
Governments and employees and employers organisations. The Chief Executive Officer of the
Organisation is the Central Provident Fund Commissioner, who is also a Member of the Board
and its Secretary.

He is assisted by the Regional Provident Fund Commissioner, one in each state and in Delhi.
The regional committees advise the Central Board on matters connected with the administration
of the scheme in their respective States. Sub-regional provident fund offices have been opened
in some regions to render better services to the subscribers of the fund. Provident fund inspectors
are appointed to carry out inspections and to perform an advisory role vis-à-vis the employers
and workers in different covered establishments. They conduct surveys to ensure that all coverable
establishments/factories are covered under the Act. They also recommend and file prosecutions
in the courts against defaulting employers and pursue these cases till their final disposal.

LOVELY PROFESSIONAL UNIVERSITY 255