Kingfisher sits on ex-staff PF contributions

The existing employees of Kingfisher Airlines are not the only ones facing a tough time.

Written by Mihir Mishra | New Delhi | Published: October 12, 2012 12:43:16 am

The existing employees of Kingfisher Airlines are not the only ones facing a tough time. Most of the 3,000-odd former employees of the beleaguered carrier,who have left the airline in the last two years too are facing the blues,with the airline not having deposited provident fund contributions for its staff. Attempts by employees and former staffers to access their retirement savings,in most cases,are being blocked.

“All employees,who have left the airline in the last two years,have not received the money deposited in their PF accounts. The airline is neither processing it nor allowing us to directly claim the money from our provident fund accounts,” said a former employee of Kingfisher Airlines. An airline spokesperson did not comment on a query sent to him on this issue. “No comments please,” he said in an SMS reply.

The debt-ridden airline did not deposit the employees’ contribution to the PF accounts of most of the staffers. “A lot of us had mandated the airline to deposit much more than the limit prescribed under the law. The airline simply did not deposit our contribution into those accounts and that has drained a lot of our savings,” the former employee added. Under the Employees’ Provident Fund Act,companies with over 20 staffers are bound to pay PF contributions for all workers earning up to Rs 6,500 per month. The company deposits 12 per cent of the basic salary into the PF account,which has to be matched by the employee.

However,under the Act,workers can choose to deposit more than the mandated 12 per cent as provident fund. This window was used by many Kingfisher employees,especially the pilots,to deposit much more than the prescribed limit into their PF accounts and are the worst sufferers. The Employees’ Provident Fund Organisation has just begun to examine the issue. “Since they have been defaulting on payment of salaries for over seven months now,it is quite obvious that they would not have been contributing provident fund as well. Though no cases have been brought to our notice,we will soon begin an audit of the company’s accounts,” said a senior PF officer when contacted by The Indian Express.

Under the EPF Act,defaulting companies who deduct but do not deposit employees’ PF contributions can be charged under Sections 405 and 420 of the IPC Act. “It is a criminal offence. The company is a trustee of the workers’ money and cannot defraud them in such a manner,” said another PF official.

The company will also be expected to deposit the PF contributions as well as pay 12 per cent annual interest and penalty. In case of non-payment,its properties and assets can be attached by the regional PF commissioner,the official explained. Kingfisher Airlines has not paid its employees for the last seven months forcing them to stop reporting to duty. Due to the agitation,the airline has been forced to declare a partial lockout till October 12. The Directorate General of Civil Aviation has also issued a show-cause notice asking the airline why its permit should not be cancelled.

For all the latest News Archive News, download Indian Express App