Karnataka High Court Declares International Worker Provisions of EPF Act Unconstitutional
Members of the Karnataka Employers Association, led by their President, B.C. Prabhakar, had challenged the validity of these provisions in the Karnataka High Court.
In a landmark judgment, the Karnataka High Court has declared Paragraph 83 of the Employees Provident Fund Act and Paragraph 43-A of the Employees’ Pension Scheme, which apply to international workers, as unconstitutional. The court found these provisions to be in violation of Article 14 of the Constitution of India.
The judgment was delivered on April 25, 2024. Members of the Karnataka Employers Association, led by their President, B.C. Prabhakar, had challenged the validity of these provisions in the Karnataka High Court.
The Special Provisions in Respect of International Workers were introduced by the Central Government under the provisions of the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952, through G.S.R 706 dated October 1, 2008.
Initially, the statutory basic wages limit for International Workers, as defined under Section 2(f) of the Act, 1952, was set at Rs. 6500 per month. However, this salary cap was removed by G.S.R 148 dated September 3, 2010. As a result, for international workers, there was no salary cap, and employers were required to deduct the EPF contribution from total basic wages.
This notification concerning International Workers was challenged in the Karnataka High Court. The court, in its judgment, pronounced Paragraph 83 of the Employees’ Provident Fund Scheme, 1952, and Paragraph 43-A of the Employees’ Pension Scheme, 1995, as unconstitutional and in violation of Articles 14 and 21 of the Indian Constitution.
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