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Andhra, Telangana RTC managements default in remittance of Rs 1700 crore in PF arrears to employees
The TSRTC MD has also been asked to bring records, including attendance register, membership or eligibility register, cash book and voucher, payment register and pay bills and all the other documents, which indicate employment strength and payment of wages to direct and indirect employees.
The Employees’ Provident Fund Organisation, under the Union ministry of labour and employment, has initiated a probe into the non-remittance of dues to the extent of around Rs 1700 crore to the employees of road transport corporations (RTC) in Telangana and Andhra Pradesh.
This was disclosed by Hyderabad regional provident fund commissioner Vipin Kumar Sharma in a letter to in-charge managing director of Telangana State Road Transport Corporation (TSRTC) Sunil Sharma on November 7, 2019.
The copy of the letter is available with HT.
Vipin Kumar Sharma said it had come to his notice that TSRTC had been participating in the Andhra Pradesh SRTC provident fund trust without formal approval or exemption from the central government.
“It is also learnt that the RTC management had not remitted the dues of employees to the RTC employees’ provident fund trust in accordance with the law,” he said.
Stating that an inquiry had been initiated against APSRTC for the non-remittance of EPF arrears due to its employees from October 2017 to September 2019, the commissioner also sought an explanation from TSRTC.
Vipin Kumar Sharma summoned TSRTC’s MD to appear before him in person or through legal representative at 11am on November 15.
The TSRTC MD has also been asked to bring records, including attendance register, membership or eligibility register, cash book and voucher, payment register and pay bills and all the other documents, which indicate employment strength and payment of wages to direct and indirect employees.
Though Vipin Kumar Sharma’s letter did not mention the amount due to be paid to the employees towards PF arrears, an official familiar with the development in Bus Bhavan, the RTC head office in Hyderabad, said the total dues in both the states would be around Rs 1700 crore, including Rs 760 crore in Telangana.
“RTC has its own EPF Trust for its employees. Each employee will contribute 12% of his or her basic wages and dearness allowance towards EPF and the RTC management also will contribute an equal amount,” the official said.
“Out of the management’s contribution, 8.33% will be diverted to Employees’ Pension Scheme, up to a maximum of Rs 1250, as the upper ceiling for EPS is only Rs 15,000,” the official added.
The remaining 3.67% of the management’s contribution is retained to the credit of the employee in the EPF Trust account.
“Over the last couple of years, the RTC managements in both the states have not been remitting this 3.67 per cent to the EPF Trust, resulting in the mounting of arrears to the extent of Rs 1700 crore,” the official said.
While TSRTC MD was not available for comment as he was in a meeting with chief minister K Chandrasekhar Rao over the RTC employees’ strike, APSRTC managing director and principal secretary of transport in Andhra Pradesh MT Krishna Babu admitted there were EPF dues to be paid.
“This situation is not confined to just RTC in Telangana and AP, but can be seen in many state and central public sector undertakings, because of mounting losses. They are struggling to pay salaries to the staff and remitting management’s contribution to the EPF account is next priority,” Krishna Babu explained.
He, however, said the RTC management would not default payment of EPF dues to employees while retiring. “The problem comes only when a large number of employees retire at a time,” he said.
On the EPFO ordering inquiry into the EPF defaults by RTC, Krishna Babu said the management had already given a commitment to the central provident commissioner that APSRTC would clear all PF arrears in 12 equal instalments with effect from January.
“We shall stand by it,” he said.
