Employees' Provident Funds Act, 1952

Employees' Provident Funds Act, 1952

(Note: There was a major amendment in 1991, but the core legislation is the Employees' Provident Funds and Miscellaneous Provisions Act, 1952.)

This Act is a piece of social security legislation designed to provide for the future of industrial employees after their retirement or for their dependents in case of their early death.

• Applicability: The Act applies to every establishment which is a factory engaged in any industry specified in Schedule I and employs 20 or more persons. Once an establishment is covered, it remains covered even if the number of employees falls below 20.

• The Three Schemes: The Act operates through three integrated schemes:

  1. Employees' Provident Fund (EPF) Scheme: A retirement savings scheme where both the employer and employee contribute equally (typically 12% of basic wages).

  2. Employees' Pension Scheme (EPS): Introduced to provide a regular pension to employees after the age of 58.

  3. Employees' Deposit-Linked Insurance (EDLI) Scheme: Provides life insurance cover to the employees.

• The 1991 Amendment Context: In 1991, significant administrative changes were made to streamline the recovery of arrears. It empowered the "Authorized Officer" to conduct inquiries and determine the amounts due from employers, similar to the powers of a Civil Court.

• Key Protection: Under Section 10, the amount standing to the credit of any member in the Fund is protected against attachment by any court in respect of any debt or liability incurred by the member.