Draft Employees’ Provident Funds and Miscellaneous Provisions (Amendment) Bill, 2019

Aug 27, 2019 | by Avantis RegTech Legal Research Team

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The Ministry of Labour and Employment (MoLE) on August 23, 2019, has proposed a draft Employees’ Provident Funds and Miscellaneous Provisions (Amendment) Bill, 2019 to further amend the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. 

The amendments made in the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 are:

 In Section 2(b) which defines basic wages has been omitted.

 A new clause (ja) and (n) has been inserted in Section 2 specifying the definition of “National Pension System” and “wages”.

 Section 6 which talks about the “contributions and matters which may be provided for in Scheme” has been substituted, namely, the contribution paid by the employer to the Fund shall be twelve percent (12%) of the wages for the time being payable to each of the employees and the employee’s contribution shall be equal to the contribution payable by the employer in respect of him.

 In Section 7A(1) which talks about “Determination of moneys due from employers”, a proviso has been inserted, provided that no inquiry shall be initiated after the expiry of the period of five years from the date on which the dispute is alleged has been arisen.

 In Section 7A(1A) has been inserted, namely, the inquiry shall be held on day to day basis and endeavour shall be made to ensure that the inquiry is concluded within a period of two years.

 In Section 11 which talks about the “Priority of payment of contribution over other debts”, any amount due shall be the first charge on the assets of the establishment and shall be paid in priority to all other debts.

 The provisions relating to penalties are proposed to enhance the quantum of fines by ten times.

 Section 14AD has been inserted, namely, all offences may either before or after institutions of prosecution be compounded by such officer or authorities and for such amount in the manner prescribed by the Central Government.

 Section 16B has been inserted, namely, the Central Provident Fund Commission or any other officer authorized, upon receipt of an application, in such form as may be prescribed, and after conducting such inquiry as may be necessary, allow any employee in the establishment to exercise the option to join the National Pension System. Provided that the application shall be deemed to have been allowed from the date of submission of application if no order is passed within a period of sixty days from the date of submission of such application.

 Section 16C has been inserted, namely, the employees working in the establishment to which this Act applies and who is a member of the National Pension System shall have the option to join back the Pension Scheme.

 In Section 17(1D) has been inserted, namely, no exemption from the operation of the Scheme shall be granted by the appropriate Government unless the applicant establishment, makes the application for grant of exemption and fulfills the conditions.

MoLE invites comments or suggestions or inputs from all the concerned stakeholders and other members of public on the preliminary draft of the Employees’ Provident Funds and Miscellaneous Provisions (Amendment) Bill, 2019, within one month time from the date of insurance or latest by September 22, 2019 as per the format (Page 1) prescribed by the MoLE. The comments or suggestions may be forwarded to Shri Rahul Bhagat, Director, Ministry of Labour and Employment, Room No. 302, Shram Shakti Bhawan, New Delhi or through email at [email protected] or [email protected]


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