Wednesday , December 25 2024

Inclusion of foreign employees in PF is unconstitutional: Karnataka High Court


15 years after the law was amended to include foreign workers in provident fund and pension schemes, the Karnataka High Court has struck down the provision as unconstitutional and arbitrary. This is a development that may be challenged in the Supreme Court by the government and the Employees' Provident Fund Organization (EPFO). The High Court order affects thousands of foreign workers who have contributed to or are currently part of the social security scheme.

It was argued by those included as appellants from sectors such as education, logistics, real estate and technology that the provisions are influenced by Article 14 of the Constitution, which means all are equal before the law. The grievance of the petitioners was that foreign workers are covered under the PF scheme regardless of their salary, while domestic workers earning a monthly salary more than the legal limit (i.e. Rs 15,000 per month) are excluded from the scheme. . Foreign employees are in India for a limited period and making them mandatory to contribute to PF based on their entire global salary will cause irreparable harm.