More than 20,700 private companies owe workers Rs. 34.3 billion in unpaid EPF

A total of 20,726 private sector organisations owe their employees Rs. 34.3 billion in unpaid Employees’ Provident Fund contributions, Parliament was told on Thursday, the Daily Mirror reported.

The precise figure given was Rs. 34,362,727,926.79. It came in a tabled written answer to an oral question raised by opposition MP Rohini Kaviratne.

Who the defaulters are

The documents tabled in the House indicate that the arrears are not confined to struggling small firms. Among the organisations that have not paid their employees’ EPF are:

Two international schools, one Catholic school and one local private school
A leading hotel and a hospital
The headquarters of a leading political party
A liquor manufacturing company
A large number of restaurants

Daily Mirror reports that trade unions also appear among the defaulting employers — organisations whose stated purpose is to defend the entitlements their own staff are owed.

None of the defaulting organisations is named in the tabled answer as reported.

How enforcement works

According to the documents tabled, the procedure is that two warnings are issued to every defaulting company, and court cases are filed against those that fail to heed them. Forty labour offices and 11 sub-offices are currently active in pursuing defaulters.

EPF contributions are deducted and remitted on behalf of private sector employees and form the main retirement savings of most workers outside the public pension system. Non-payment leaves the deduction unaccounted for in the worker’s fund.

Not reported

The tabled answer as reported does not say how the current figure compares with previous years, so it is not possible from this filing to say whether arrears are rising or falling. It does not give the number of court cases filed to date, how many have concluded, or how much has been recovered through them.

It also does not name any defaulting organisation, state how far back the oldest arrears run, or say whether any employer has faced penalties beyond the filing of a case. No response from the Department of Labour or the Minister of Labour is reported beyond the tabled documents themselves.