The story so far: In a landmark ruling, the Karnataka High Court recently struck down a 15-year-old amendment to the law which permits the incorporation of foreign workers in the employees’ provident fund (EPF). Accordingly, it quashed the special provisions for international workers under paragraph 83 of the Employees’ Provident Funds Scheme, 1952 (EPF Scheme) and paragraph 43A of the Employees’ Pension Scheme, 1995 (EP Scheme) for being “unconstitutional and arbitrary.”
Justice KS Hemalekha highlighted that while the schemes prescribe a salary cap of ₹15,000 per month for domestic workers to avail of provident fund benefits, no such limit exists for international workers. She reasoned that this disparity amounts to a violation of Article 14 of the Constitution, which guarantees equal protection of the laws.
According to Sonu Iyer and Puneet Gupta, partners at EY India, the ruling is likely to be challenged before a larger bench of the High Court or the Supreme Court. “Until then, employers may analyse the impact of the ruling and devise their compliance strategy accordingly, also considering the fact that similar writs are pending before other High Courts in the country,” they told The Hindu.
