Charge-Sheet – Procedure for serving the same
There is a common tendency amongst the suspended and or charge sheeted
employee/workman that they try to evade the service of the charge-sheet when sent by Registered/Speed Post, Courier, Email, Whats app or SMS. In fact in
such cases, the Charge-Sheet should be published in the local leading
newspaper/s as held by Supreme Court.
In another case, the SC has held that the publication of a charge-sheet or a
show-cause notice in the news paper which is not known to be popular in the
area, will not be sufficient and the initiation of disciplinary proceedings
upon such defective service will be treated as BAD IN LAW. When rules
provide that charge-sheet should be serviced either by Registered Post or by Publication, then pasting it on the door of residence of delinquent employee
will not be proper.
EPF pension case: PF members don’t automatically become eligible under EPS, EPFO tells Supreme Court.
The Employees Provident Fund Organisation (EPFO) on Tuesday told the Supreme Court of India the structure of Employee Provident Fund Scheme (EPFS) and Employee Pension Scheme (EPS) is entirely different.
EPFO, appearing through Senior Advocate Aryama Sundaram made the submission before Justices UU Lalit, Aniruddha Bose and Sudhanshu Dhulia. The Bench was hearing a batch of appeal pleas filed by the Employees Provident Fund Organization (EPFO) in the issue related to payment of EPF pension to employees in proportion to their salary.
The appeals were specifically challenging the judgments of Kerala, Delhi and Rajasthan High Courts which had quashed the 2014 Amendment Scheme.
The Kerala High Court, in 2018, had set aside Employee’s Pension (Amendment) Scheme, 2014 that capped maximum pensionable salary to Rs.15, 000 per month, observing that it is unrealistic and would deprive most of the employees of a decent pension in their old age. Last year, a 2-judge bench of the Supreme Court had referred the appeals to a 3-judge bench to consider the following issues :
1. Whether there would be a cut-off date under paragraph 11(3) of the Employees’ Pension Scheme and
2. Whether the decision in R.C. Gupta v. Regional Provident Fund Commissioner (2016) would be the governing principle on the basis of which all these matters must be disposed.
Arguments of EPFO on Tuesday
Referring to the EPFO’s written arguments, Sundaram, assisted by Advocate Siddharth, submitted that Kerala High Court’s judgment overlooks the distinction between the structure of Employees Provident Fund Scheme (EPFS) and Employees Pension Scheme(EPS).
“It(HC) incorrectly assumes that all members of the EPF must inevitably be entitled to all benefits of the Pension Fund. This is incorrect. In EPF, employees and employers’ contributes a cumulative in the individual account, and consequently determines the benefits mainly the Provident Fund Cumulation. But EPS is meant for weaker section of the Indian workforce whose contributions are inadequate to yield proper retirement benefits. Therefore, the benefits therein, is defined in advance and consequentially, the rate of contribution is determined annually. The impugned judgement overlooks this important difference and declares it all members of the EPFS who are contributing above the base threshold EPFS, are entitled to the contribute above the base threshold in EPS and consequentially draw pension on the basis of such higher contributions. Further, it also ignores that the contributions in EPS must be made contemporaneously… and permits former members of the EPS to offer retrospective contributions.”
During the hearing, Sundaram primarily argued that employees drawing salary above the threshold of Rs 15,000 per month can be entitled to the Pension only if they make contributions after making a joint application with the employer within the cut-off period.
“What they (the respondents) are seeking is that they did not contribute every month, and after the lapse of 10, 20 or 30 years, whatever they have not paid that that point in time, you please take that now in one go and fix my pension. Such kind of an arrangement is not permitted under the scheme”, Sundaram submitted.
Further, Sundaram submitted that there are two necessary aspects with regard to EPS.
“First is that the option must be exercised by both employer and employee. In this case, employee does not exercise the option even prior to 2014 Amendment. Two, there must a remitting of money into the Pension Fund within 15 days. Why do you do with a person who does not exercise this option?…..The (Kerala) High Court says no-no and strikes down the Amendment. And applying the proviso, gave it to people who did not opt at that time and gave them the right to opt later. (It said that) opting is not necessary because Pension Fund is a necessary corollary of the Provident Fund. According to High Court you are a member of the provident fund, then ipso facto, you are member of the Pension Fund…..”
“While I want to show that the Amendment is correct, even without the 2014 Amendment, the Kerala High Court Judgement is wrong”, Sundaram submitted.
Sundaram argued that under the Provident Fund Scheme, the contributions made by the employer and the employees during the employment of the employee would be paid over to the employee along with interest accrued thereon at the time of their retirement. So, the obligation on the part of the operators of the Provident Fund Scheme would come to an end, after the retirement of the employee.
On the other hand, the obligation under the Pension Scheme would begin after the employee retired.
Also, it would be for the operators of the Pension Scheme to invest amount deposited in such a way that after the retirement the invested amount would keep on giving sufficient returns so that the pension would be paid to the employee not only during his life time but even to his family members after his death.
HC orders will create great imbalance
Sundaram submitted that allowing pension for employees who draw salary above the threshold rate will create great imbalance with the pension fund. If such employees are allowed to draw pension proportionate to the salary, the purpose of the pension fund, which is to protect the interests of employees who are in the low-salary segment, will get defeated.
During the hearing, the bench posed queries to Sundaram regarding the scheme of the 2014 amendment. He explained that the newcomers after the 2014 amendment are not entitled to pension if the monthly salary is above Rs 15,000. As regards existing employees who draw salary above the threshold, they are entitled to EPF pension only if they exercise the option within the cut-off dates and make contributions.
“The rationale is that EPS is meant to ensure a minimum of guaranteed retiral benefits to the vulnerable members of EPFS”, he said.
Sundaram said that there is no petition filed by a new-comer challenging the denial of pension and the petitions are filed by those who were members at the time of 2014 amendment and most of them have not even made their contributions to EPS.
The senior counsel submitted that the 2014 amendments were brought on the basis of sufficient materials from accounting experts showing the imbalance created within the fund and the Courts could not have second-guessed the expert opinion. There is no issue of discrimination as the classification is based on an intelligible differentia which has a nexus with a rational objective, he emphasised.
As the hearing moved to a close, the Bench told Sundaram that he would be allowed to make further submissions, if any, by way of a rejoinder. The Bench also asked the other counsel to wrap up their submissions in a time-bound manner, the coming days.
“You (Union of India) please finish your arguments by 1 pm”, the Bench said.
The Union of India is expected to make arguments today in the matter.
EPF Pension Case: Timeline
In 2019, a three-Judge Bench comprising the then CJI Ranjan Gogoi, Justice Deepak Gupta and Justice Sanjiv Khanna had dismissed the Special Leave Petition filed against a Kerala High Court Judgment setting aside Employee’s Pension (Amendment) Scheme, 2014 that capped maximum pensionable salary to Rs.15, 000 per month.
The Kerala High Court, while setting aside the 2014 amendments by its 2018 judgment, had declared that all the employees shall be entitled to exercise the option stipulated by paragraph 26 of the EPF Scheme without being restricted in doing so by the insistence on a date.
Further, the High Court had also set aside the orders issued by the EPFO declining to grant opportunities to the employees to exercise a joint option to remit contributions to the Employees Pension Scheme on the basis of the actual salaries drawn by them.
In April 2019, the Supreme Court had dismissed the special leave petition filed by the EPFO against the Kerala High Court’s judgment, through a summary order.
Later, in January 2021, a three-judge bench recalled the dismissal order in the review petitions filed by the EPFO and posted the matters for hearing in open court.
On February 25, 2021, the division bench of Justice UU Lalit and Justice KM Joseph restrained the High Court of Kerala, Delhi and Rajasthan from initiating contempt proceedings against the Central Government and the EPFO over the non-implementation of the HC verdicts.
Case Title: EPFO vs Sunil Kumar and Ors
Read MoreLaunch of ESIC COVID RELIEF SCHEME.
This is to inform that ESIC has launched a New Scheme called ESIC COVID RELIEF SCHEME, which is a Welfare Measure taken to provide Relief to the Dependants of the IPs (Insured Persons), who have died due to Covid-19.
The Salient features of this ESIC COVID RELIEF SCHEME are given below for your kind information:
1. The Scheme will be effective from 24-03-2020, for a period of 2years.
2. If any Insured Person, has died due to Covid-19, his Eligible Dependant family members will get Relief up-to 90% of the Average Wages.
3. The payments will be periodical monthly and will be given to the Eligible Dependents as per the share specified in the ESIC Headquarters Letter No P-11/14/11/COVID-19 Relief Scheme/2021-Bft II dated 04-06-2021.
4. The Minimum Relief under the Scheme will be Rs 1800/- per month.
ELIGIBILITY CONDITIONS FOR AVAILING THE ESIC COVID RELIEF SCHEME:
1. The IP who died due to Covid-19, must be Registered on ESIC Portal atleast 3 months prior to date of Diagnosis of Covid-19, resulting in death.
2. The deceased IP should have been in Employment on date of diagnosis of Covid-19.
3. ESI Contributions for atleast 70 days should have been paid or payable in respect of him/her during a period of 1 year immediately preceding the Diagnosis of Covid-19, resulting in death.
A scanned copy of the ESIC Headquarters Letter No P-11/14/11/COVID-19 Relief Scheme/2021-Bft II dated 04-06-2021, containing complete instruction on the subject is attached with this mail for your ready reference.
Accordingly, it is requested to kindly bring this New Scheme to the knowledge and information of all your Employees who are registered with ESIC.
Also, kindly intimate to this office, the details of any of your Employees who have unfortunately died due to Covid-19, to enable us to examine and process their Benefit under the Relief Scheme.
Read More
EPFO gets electronic facility for key employers
The Employees Provident Fund Organisation (EPFO) has launched an electronic
facility for the key employers that will help them check the EPF compliance
of their contractors.
EPFO-registered employers, who engage employees
through contractors, can add details of the contractors and the contract
employees on EPFO’s unified portal. Anil Kumar Pritam, the Regional
Commissioner (Grade-1), of the Nashik Region EPFO, said some employers
source manpower via contractors.
However, they are unable to know whether
the contractors concerned are paying the PF contribution of their workers.
“This new electronic system will help the employers know whether the
contractors have opened the PF accounts of their contract workers and are
actually making the PF contribution of their workers regularly,” he said,
adding that contract workers will not be deprived of EPF facilities as
employers will be able to ensure that the contract workers are registered
with the EPF.
Breaking News on Labour Laws….
PF Salary ceiling to be Increased to Rs. 25,000/- from Rs.15,000/- as recommended by CBT to Ministry of Labour & Employment.
CBT members have proposed to the Ministry of Labour to cut contribution and increase the EPF cover wage limit for the country’s 4.5 crores PF members.
EPFO Central Board of Trustees (CBT) members have started pressuring them citing the interest of employees.
Members have demanded the Labour Ministry to include it on the agenda of the next board meeting.
The Board members have made it clear in the proposal that, like ESIC of the Ministry, the ceiling of the coverage of employees has been increased to Rs. 21,000 salary, similarly, the wage limit of contribution deduction of PF members should be increased from Rs. 15,000/- pm to Rs. 25 000/- pm.
At present, the maximum amount of PF contribution is Rs.1800/- per month on PF Salary of Rs. 15,000/- .
The employer contributes the same amount, but given the time, this amount is less.
Therefore the deduction limit should be on PF salary of Rs. 25,000/- pm.
EPFO CBT member Harbhajan Singh said to media that the members have given the proposal to the Union Labour Minister along with the Ministry.
Increasing the cover limit will strengthen the PF account of the employees and will also deposit a huge amount in EPFO Fund.
Harbhajan Singh further said that the minimum pension is still Rs. 1000/- pm which inadequate according to the current time and circumstances.
The members have proposed to increase it to Rs. 7,500/- pm.
EPFO can use the funds lying in inoperative accounts to increase the pension.
Unclaimed money has never been cleared. In the year 2014, the unclaimed amount was Rs. 40 thousand crores and in the last financial year, it was stated as Rs. 27 thousand crores.
These issues will also come up in the board meeting.
This is just FYI and nothing has been finalized so far.
Read MoreTemporary staff can’t be sacked sans hearing: HC
The Madhya Pradesh high court has said that the principle of natural justice applies to temporary employees as well, and they can’t be dismissed from service without being given a hearing if it is being done on some charge that is stigmatic. The judgment came in response to a petition filed by a peon of Chhindwara district civil court, who was appointed against a contingency fund. The petitioner, Sunil Kumar Verma, said he was appointed as waterman in the district court in July 1994 and promoted to peon two years later but his services were not regularised.
According to his petition, a ‘false FIR’ was lodged against him on January 2, 2000, and he was arrested. Since he was in police custody, he couldn’t come to work the next day and on the basis of “unauthorised absence from duty”, he was terminated from service on January 20, 2000, he says.
Read MoreRescued Jharkhand Child Labourer Becomes Voice Of India At Labour Meet
From working in a mica mine in Jharkhand’s Giridih district as a child labour to representing India in a global event by the International Labour Organisation (ILO) at Durban – the journey has been long for Badku Marandi. Badku, 21, is among four people to represent India in the 5th Global Conference on the Elimination of Child Labour, organised by the ILO and the government of South Africa from May 15 to 20. “After being rescued by Nobel Peace Prize winner Kailash Satyarthi Foundation, the mission of my life is to rescue other children and encourage them to begin a new life,” Badku, who is now studying in class 11, told PTI from Durban over the phone. He said he is a resident of Kanichihar village in the Tisri block of Giridih district and is now engaged in creating awareness about child labour among children of the area and extending support to them through the foundation.
Read More‘Cut down notice period in IT/ITES sector to global standards’
Thomas Brenneke of Network Redux says with unmatched Indian talent, there should be a fair system for everyone to hire a good talent pool. Voicing concern over the extent of the notice period for IT/ITES workers who want to exit Indian companies, an IT company promoter in Kochi has suggested lessening the number of days on par with global standards.
The current 90-day notice period creates a lot of difficulties in attracting good talents, and it needs to be reduced to 30-60 days, said Thomas Brenneke, Founder & CEO, Network Redux, based in Infopark here. “Right now, this is a great concern especially for small and medium companies in India and it creates revenue loss as well”, he told BusinessLine in an interaction. The Indian talent is unmatched.
However, there should be a fair system for everyone to hire a good talent pool. The company raised this issue at the recently concluded NASCOM SMB forum. He said the industry body or the government should develop a regulation to this effect
From the Desk of Dayanand Mangaonkar
Read MoreNO GST LEVIABLE IN THE HANDS OF EMPLOYER ON AMOUNT REPRESENTING EMPLOYEES’ PORTION OF CANTEEN CHARGES: GUJ. AAR
The Gujarat Authority of Advance Ruling (AAR) ruled that no GST is leviable in the hands of the employer on an amount representing the employee portion of canteen charges.
The applicant, M/s Cadila Healthcare Ltd. is in the business of manufacturing, supplying and distributing various pharma products. M/s Cadila has approximately 7200 employees in it factory and corporate offices and was registered under the provisions of Sec. 46 of the Factories Act, 1948. As per the provisions, Cadila submitted that it was mandatory to provide canteen facilities to its employees at the factory by appointing a Canteen Service Provider to comply with the statutory requirement laid down under the Factories Act.
Cadila and Canteen Service Provider have entered into an agreement whereby Cadila shall pay the full amount to the service provider for the food served during a prescribed period on behalf of the employees and a predetermined % of the amount paid by Cadila.
The balance amount was recovered from employees (without any profit) and the difference of amount was borne by Cadila. It is being treated as a staff welfare expenses towards subsidised food served to the employees.
The applicant has sought an advance ruling on the issue of whether the subsidised deduction made by the applicant from the employees who are availing food in the factory/corporate office would be considered as a supply by the applicant under the provisions of Sec. 7 of the Central GST Act, 2017 and the Gujarata Goods and service Tax Act, 2017.
The applicant submitted that merely setting up a canteen facility for the employees and deducting a nominal cost would not tantamount to supply under Sec. 7 of the CGST Act.
The AAR noted that Cadila has arranged a canteen for its employees, which is run by a Canteen Service Provider. As per their arrangement, part of the canteen charges were borne by Cadila, whereas the remaining part was borne by its employees. The employees’ portion of the canteen charges were collected by Cadila and paid to the canteen service provider. Cadila submitted that it does not retain any profit margin in this activity of collecting employees’ portion of canteen charges.
AAR, therefore, stated that they are not inclined to accord this canteen service facility provided by Cadila to its employees the status of an activity made in the course or furtherance of business to deem it supply by Cadila to its employee and hence no GST applicable on such transactions.
Read MorePanel backs raising monthly EPFO wage ceiling to ₹21,000.
A high-level committee has backed a proposed increase in wage ceiling under the Employees’ Provident Fund Organisation (EPFO) to ₹21,000 a month from the current ₹15,000.
The committee has, however, said the government can implement the increase from a later date considering all inputs.
The proposal, once implemented, will bring an estimated 7.5 million additional workers within the fold of the scheme, and also adjust for the increase in wages as the last revision was done in 2014.
“The ad-hoc committee on EPFO coverage has agreed to enhance wagesunder EPF Act to align with ESI establishment,” a senior government official told ET, adding that it has suggested the implementation to be considered at a later stage and not immediately.
The suggestion, if accepted by the central board of the trustees of EPFO, will give a breather to the employers who are reluctant to immediately take on any additional financial burden.
Employers had in their consultations cited stress on their balance sheets due to the outbreak of the pandemic and sought more time for implementing the proposed increase.
It will also be a relief for the exchequer as the Centre currently pays about ₹6,750 crore every year to the Employees’ Pension Scheme of the EPFO. The government contributes 1.16% of the total basic wage of EPFO subscribers towards the scheme.
Under the current rules, any company with more than 20 employees must register with the EPFO and the EPF scheme is compulsory for all employees earning less than ₹15,000.
The increase in the limit to ₹21,000 will bring more workers under the retirement scheme. It will also align the ceiling with the other social security scheme Employees’ State Insurance Corporation (ESIC) where the limit is ₹21,000.
KE Raghunathan, an employer’s representative on the central board of the trustees of the EPFO, said there is a consensus within the EPFO that similar norms should be followed for providing social security under both EPFO and ESIC.
“Workers should not lose out on the benefits of their social security because of the difference in norms under the two schemes,” he said.
Labour unions are, however, apprehensive the decision may take a very long time to implement.
“Lots of hurdles are in the way to implement this including the required approval from the finance ministry,” a trade union representative said requesting not to be identified.
From the desk of Dayanand Mangaonkar
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