Section 2 of EPFMA : Section 2: Definitions

Explanation using Example

Contextual Example:

Imagine a company named XYZ Technologies, which is a software development firm with branches across multiple states in India. Since XYZ Technologies has branches in more than one state, it falls under the jurisdiction of the Central Government according to the definition of "appropriate Government" in the Act. Therefore, any matters related to the Employees Provident Funds would be handled by the Central Government for XYZ Technologies.

One of XYZ's employees, Raj, earns a monthly salary which includes basic pay, dearness allowance, and house-rent allowance. According to the definition of "basic wages" in the Act, only Raj's basic pay would be considered for the calculation of his provident fund contributions, while the dearness and house-rent allowances would be excluded.

Raj's contributions to the provident fund, as well as XYZ Technologies' matching contributions, are termed as "contribution" under the Act and are to be deposited into the Employees' Provident Fund.

If XYZ Technologies were to receive an exemption under section 17 of the Act, it would become an "exempted establishment," meaning that it would not be required to follow certain provisions of the Provident Fund Scheme or the Insurance Scheme, as specified in the exemption.