Interference in Quasi-Judicial Process of PF Law: CITU lodges strong protest

Interference in Quasi-Judicial Process of PF Law

CITU lodges strong protest

CITU general secretary Tapan Sen, MP in his letter of 14 December, 2012 to the Union minister for labour and employment Mallikarjun Khagre strongly protested against government’s interference in favour of the employers in the application of the process of law in respect of provident fund assessment of crores of workers and employees.

Vide reference no. 7(l)2012/RCs Review Meeting/ 345 dated 30 November 2012 the Employees Provident Fund Organization (EPFO) issued ‘Guidelines for Quasi-judicial proceedings under Section 7A of the Employees' Provident Funds & Miscellaneous Provisions Act 1952’ to all PF commissioners.

Item no. 12 of the Guideline, on definition of ‘Basic wage’ for PF assessment, states that the basic wage shall include ‘all the payments except the specified exclusions.’ And ‘All such allowances which are ordinarily, necessarily and uniformly paid to the employees are to be treated as part of the basic wages’ for quasi-judicial intervention. On this, the media and the employers made hue and cry and the labour minister obliged by announcing this clarification in abeyance.

In his letter Tapan Sen pointed out, what is stated in item 12 of the above referred guideline “is nothing more than the reiteration of what has been provided under EPF Act” and “is the urgent need of the hour since there has been large number of violations by the employers, particularly in private sector where the employers use to calculate PF contribution only on a part of wages being paid to the workers in order to minimize their own obligation of matching contribution to workers’ PF.” The letter pointed out that even in case of statutory minimum wage; the employers deprive the workers from getting PF benefit on full quantum. However, the circular has also certain objectionable anti-workers provisions which the minister conveniently ignored.

It contains certain directions to circumvent judicious applicability of certain legal provisions. It directed the field officers that dues would not be assessed where the employers did not produce records for enquiries under Section 7A. This was an unwanted interference as the inquiry under Section 7A is a quasi judicial inquiry. This direction will give undue advantage to the employers who will be benefited by non-production of records. Certain cases, connected with such issues, are pending before the Supreme Court. Further, the circular stipulates 7 years limitation for inquiries under Section 7A. This is also against the interests of workers and is not applicable to quasi judicial inquires.

CITU and other trade unions also opposed these directions and demanded their withdrawal.