HC stays coercive recovery of PF contribution for community health workers from BMC

In a relief for the Brihanmumbai Municipal Corporation (BMC), the Bombay high court (HC) last week restrained the provident fund (PF) commissioner from taking any

In a relief for the Brihanmumbai Municipal Corporation (BMC), the Bombay high court (HC) last week restrained the provident fund (PF) commissioner from taking any coercive action against the civic body for recovering ₹23.64 crore towards PF contribution for its community health volunteers (CHVs). The liability of the civic body to pay PF contribution for CHVs is under a cloud of strong suspicion, said justice Nitin Sambre while imposing the restraint.

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The judge was hearing petition filed by BMC, after its appeal against an adjudication order was dismissed last year on June 28. The adjudication authority had held that the CHVs were workmen, as contemplated under the Employees Provident Fund and Miscellaneous Provisions Act, 1952, and the civic body was liable to pay their PF contribution. The liability was fixed at ₹23.64 crore.

It was argued on behalf of BMC that CHVs were not its permanent employees, as no wages are paid to them. It was claimed that only honorarium is paid to them and thus, the PF Act was not applicable CHVs and the orders passed by PF authorities were without jurisdiction.

In support of the argument, the civic body pointed out that in a 2006 reference, an industrial court has held that CHVs are not permanent employees of the corporation.

The civic body also pointed out that CHVs were initially appointed under a project floated by the central government, which was later taken over by BMC. However, the nature of duties performed by CHVs cannot be termed as one that of employees of the corporation.

Justice Sambre also took into consideration the fact that the January 2017 HC orders on petitions filed by some CHVs declaring that they are employees of the civic body had been stayed by the Supreme Court in August 2018.

As a consequence, prima facie, liability cannot be fastened on the municipal corporation, said justice Sambre, adding that the Apex court’s conclusion on the status of CHVs as workmen will have direct bearing over the outcome of this petition. HC directed that there shall be no coercive recovery of the PF contribution till the decision of the Supreme Court.