The state government will crack down on pilferage of labour provident fund (PF) dues held back by contractors even when hiring companies have paid their share.
Labour Department officials will immediately intervene and issue an advisory regarding the matter to government departments, public sector undertaking and private companies to ensure that contract labour working in malls, commercial and government offices do not suffer and lose out on its Provident Fund dues.
Senior officials of the state finance department said based on complaints from the Employee Provident Fund Organisation (EPFO), they have directed the state Labour Department and its inspectors to crack down on contractors holding back these dues.
A company which hires contract labour makes a lump sum payment to the contractor towards employer PF contribution, but the finance department has been informed that PF dues are in turn not deposited to the EPFO by the contractors.
“What the contractor typically does is bifurcate wages into basic and other allowances to cut down on the PF payout. We have asked the inspectors of our Labour department to start a drive and crack down on such contractors with immediate effect,” an official said.
Senior officials said labour inspectors will visit malls and private companies to ensure compliance and make sure the contractor agency has a PF code numbers, and has registered all employees under the PF scheme. The PF is computed at 12 per cent (both employer and employee contribution) against basic wages, senior officials said.
“We have asked the field staff to collect details of contract labour engaged through private agencies, government departments. The drive has already started from Mantralaya to ensure contractors’ PF obligation towards contract labour is maintained,” a senior government official said.
Finance dept has directed the Labour Dept to act against contractors holding back these dues
