PF Deduction From Labors For Previous Months Salary

Sir,

While calculating labor payable wages, we have left out deductions of PF and ESI for the last 2-3 months, and payments have been made. Since the same laborers are working with us, is there a provision to deduct 3 months of ESI and PF from the next payable labor wages at once and deposit it into the PF Account as we have not filed ECR for the last 2-3 months? What reasons can be stated to the department while making these payments? Please suggest.

Thanks,
Manjunatha

As per law, you cannot recover past dues. However, you need to pay. If you are able to convince the workmen, deduct the contribution under the Head MISCELLANEOUS Recoveries. Additionally, you need to pay the interest for belated payment. The EPFO has announced a scheme for NEW COVERED individuals until 31.3.2017.

Can you please clarify under which rule or section it is stated that you cannot deduct or recover excess salary paid on account of not deducting earlier? As far as I know, employers are allowed to do so. However, deducting all at once would be wrong and likely a violation of the Payment of Wages Act. Therefore, you need to recover in stages or instalments.

If the number of employees is not big, please communicate the mistake and work on a fast recovery strategy within one month. It's correction, and there is no legal barrier to reclaiming excess money paid to an employee. Who knows, someone might leave in between. However, belated contributions are to be paid with interest as they are already overdue, and it has no connection with the latest notification in effect until March 17.

Regards,
RDS Yadav

Please take this as an opportunity to learn. Please go through carefully the Employees' Provident Fund & Miscellaneous Provisions Act, 1952, and the three schemes framed thereunder. I can provide you with information, but I strongly recommend that you take the time to learn.

Sir,

Section 32 of the scheme provides that where no such deduction has been made on account of an accidental mistake or a clerical error, such deduction may, with the consent in writing of the Inspector, be made from the subsequent wages.

P K Sharma