Under the Employee Provident Fund, an employee has to pay a certain contribution towards the fund and an equal contribution is paid by the employer. The employee gets a lump sum amount including self and employer’s contribution with interest on both, on retirement. This fund is managed by the Employees’ Provident Fund Organisation (‘EPFO’) which administers the compulsory contribution to the Provident Fund Scheme, a Pension Scheme and an Insurance Scheme for the workforce engaged in India.
The EPFO had recently notified that no proceedings will be initiated against employers if there is delay in payment of any contributions or administrative charges due for any period during COVID-19 lockdown. This relief has been given by the EPFO to all establishments and factories, considering the difficulty faced by the establishments and employers in paying the deposits on time due to operational and economic reasons. Under the law employers are punished with jail time upto 3 years for not paying the contributions but the EPFO has made it clear that no action will be taken against the employers as the delay is not intentional and due to COVID-19.