EMPLOYEES' PROVIDENT FUND ACT

Arrangement of Sections

1. Short title.

PART I

Establishment and Membership of the Employees' Provident Fund and Administration of this Act and of Such Fund

2. Establishment of Employees' Provident Fund.

3. Membership of the Fund.

4. Administration of this Act.

5. Powers and duties of the Monetary Board to relation to the Fund.

5A. Employer to communicate to member the information notified by the Monetary Board.

6. Auditor-General to audit the accounts of the Funds.

7. Repayments to Government.

7A. Expenses incurred in the administration of the Act.

PART II

Covered Employments, Employees to Whom This Act Applies, and Contributions

8. Covered employments and employees to whom this Act applies.

9. Immediate employer being himself in the employment of another person.

10. Normal contributions.

11. Right of employees and employers to elect to pay contributions calculated at higher percentages and liability of employees and employers who make such election.

12. Commissioner's direction to employer who has reduced the earnings of any employee for the purpose of reducing the amount of the employer's contributions under this Act in respect of the employee.

13. When fraction of a cent is to be ignored, or is to be reckoned as one cent, in computing the amount of a contribution.

14. Interest on contributions.

15. Payment of contributions due from employees.

16. Imposition of surcharge on employers on failure to pay contributions on due date.

17. Recovery of contributions.

18. The sums to be credited to the individual account of members.

19. Employer prohibited from reducing earning of his employees.

20. Employer prohibited from deducting from earnings of employee payments due from employer under this Act in respect of employee.

21. Amount due under this Act from an employer to be paid by him to be the first charge on his assets.

22. Money to the credit of individual accounts to be inalienable.

PART III

Benefit

23. Time at which benefits will be paid off.

23A. Housing benefits and benefits relating to medical treatment.

24. Persons to whom benefits shall be paid in certain circumstances.

25. Definition of benefit.

26. Claim to benefit.

PART IV

Approved Provident Funds and Approved Contributory Pension Schemes

27. Approved provident funds and approved contributory pension schemes.

PART V

Determination of Claims

28. Commissioner or an officer authorised by the Commissioner to determine claims.

29. Appeals.

30. Remuneration of member of the Tribunal.

PART VI

General

31. Power of Commissioner to call for returns.

31A. Imposition of a surcharge on employers who fail to furnish returns.

31B. Duty to furnish returns.

32. Powers of Commissioner and other officers to inspect premises.

33. Employers to keep records.

34. Offences.

35. Liability of manager, agent of employer for offences.

36. Where the employer proves that some other person is guilty of an offence.

37. Punishment for offences.

38. Recovery of arrears of payments due in certain cases.

39. Burden of proof.

40. Offences by bodies of persons.

41. No prosecution without the sanction of the Commissioner.

42. Proof of regulations and orders.

43. Exemption from income tax.

44. Exemption from stamp duty.

45. Protection for action taken under this Act.

46. Regulations.

47. Interpretation.

48. Prohibition of reduction, on certain ground, of rate of contribution to a provident fund or contributory pension scheme.

49. Act to prevail in case of conflict with other written law.

15 of 1958,

18 of 1965,

16 of 1970,

8 of 1971,

24 of 1971,

26 of 1981,

1 of 1985,

42 of 1988,

14 of 1992,

2 of 2012.

AN ACT to establish a Provident Fund for the benefit of certain classes of employees and to provide for matters connected therewith or incidental thereto.

[Date of Commencement: 1st June, 1958]

1. Short title.

This Act may be cited as the Employees' Provident Fund Act.

PART I

Establishment and Membership of the Employees' Provident Fund and Administration of this Act and of Such Fund

2. Establishment of Employees' Provident Fund.

For the purposes of this Act there shall be established a fund called the Employees Provident Fund (hereafter in this Act referred to as the Fund).

3. Membership of the Fund.

(1) Where an employee first becomes liable under section 10 to pay contributions to the Fund, he shall then become a member of the Fund and continue to be a member of the Fund so long as there is any sum to the credit of his individual account in the Fund.

(1A) Where an employee becomes a member of the Fund established under subsection (1), the Commissioner-General of Labour shall assign an identification number to such employee and employer in the prescribed manner.

[S 3(1A) ins by s 2 of Act 2 of 2012.]

(2) Neither a member of the Fund nor any person claiming under him shall have any interest in, or claim to, the moneys of the Fund otherwise than by virtue of any provision of this Act or of any regulation.

4. Administration of this Act.

(1) Except as otherwise provided in this Act, the Commissioner of Labour shall be in charge of the general administration of this Act.

(2) Subject to any general or special directions of the Commissioner of Labour, any Deputy Commissioner of Labour or any Assistant Commissioner of Labour may exercise, perform or discharge any power, duty or function of the Commissioner under this Act or under any regulation.

(3) There may be appointed such number of officers as may be required for the purpose of carrying out or giving effect to the provisions of this Act,

(4) The Commissioner of Labour may either generally or specially authorise any officer appointed under subsection (3) of this section, to exercise, perform or discharge any power, duty or function of the Commissioner under this Act or under any regulation.

5. Powers and duties of the Monetary Board to relation to the Fund.

(1) The Monetary Board—

(a) may appoint such officers and servants as may be required by the Board for exercising its powers, performing its duties and discharging its functions under this Act, fix the salaries and wages of such officers and servants and determine their conditions of service;

(b) shall receive all sums paid under this Act as contributions, surcharges and fees, and the income from the investment of moneys of the Fund and shall credit such sums and income to the Fund;

[S 5(1)(b) am by s 2 of Act 8 of 1971.]

(bb) the Board shall determine with the concurrence of the Minister, the amount of surcharge to be distributed, among the members affected by the failure of their employers to pay the contributions due from him to the Fund, on the day such contribution is due, out of the money received by way of surcharge under the provisions of section 16;

[S 5(1)(bb) ins by s 2(1) of Act 1 of 1985.]

(c) shall have custody of the moneys of the Fund;

(d) shall pay to the persons certified by the Commissioner the benefits to which those persons are entitled under this Act;

(e) may invest such of the moneys of the Fund as are not immediately required for the purposes of this Act in such securities as the Board may consider fit and may sell such securities;

"(ee) may invest such amount of moneys of the Fund according to such terms and conditions as may be prescribed, to purchase a land for the construction of a Secretariat on behalf of the Fund or to construct such Secretariat on any land belonging to or held by the Fund, for the use of the Fund;

[S 5(1)(ee) ins by s 3(1) of Act 2 of 2012.]

(f) shall maintain a general account in respect of the Fund, and a separate account (in this Act referred to as an individual account) in respect of each member of the Fund;

(ff) shall maintain a Suspense Account, into which shall be credited the contributions received under this Act in
respect of which, the employers have failed to furnish relevant returns in terms of the Act or any regulations made thereunder, or have furnished deficient or incorrect returns and thus cannot be credited to individual accounts, and all the moneys held on the date on which this paragraph comes into force, in an account maintained by the Fund in respect of such contributions, shall be transferred by the Monetary Board to the Suspense Account created by this paragraph.

As and when an employer, who has failed to furnish relevant returns as referred to above, furnishes correct returns in respect of his employee, the Monetary Board shall transfer the moneys lying in the Suspense Account to the individual account of the member.

Where any moneys are transferred from the Suspense Account to an individual account as provided for in this paragraph interest shall be paid on that sum, for the period from the date of receipt of such moneys to the date of transfer of such moneys to the individuals account and the rate of interest shall be the rate determined in terms of section 14(1) of the Act, and applicable for the year in respect of which the interest is paid;

[S 5(1)(ff) ins by s 2(a) of Act 42 of 1988; am by s 3(2) of Act 2 of 2012.]

(g) shall cause the books of accounts relating to the Fund to be balanced as on the thirty-first day of December in each year;

(h) shall cause to be prepared in respect of the Fund for each year a statement of receipts and payments, a statement of income and expenditure, a statement of assets and liabilities, and a statement of investments showing the face value, purchase price, and market value of each of the investments;

(i) shall transmit to the Minister a copy of each of the statements prepared under the preceding paragraph (h) for each year within three months after the thirty-first day of December of that year;

(j) shall notify—

(i) the employer of each member of the Fund who is employed in a covered employment, and

(ii) each member of the Fund who has ceased to be employed in a covered employment, within nine months after the thirty-first day of December in each year, of the amount lying to the credit of the individual account of such member on that day;

[S 5(1)(j) subs by s 2 of Act 8 of 1971.]

(k) shall deduct from the income from the investment of moneys of the Fund, the expenses incurred by the Board and the Commissioner in carrying out their respective functions under this Act;

[S 5(1)(k) subs by s 2(2) of Act 1 of 1985.]

(kk) may establish such reserves out of the income of the Fund as the Monetary Board may determine, to meet any contingencies or any depreciation in the market value of the assets of the Fund; and

[S 5(1)(kk) ins by s 2 of Act 8 of 1971.]

(kkk) shall deduct any outstanding monies due on a housing Loan under section 22, from the individual account of a member, upon a directive from the Commissioner to that effect, and transfer the amount so deducted to the relevant lending institution.

[S 5(1)(kkk) ins by s 2(b) of Act 42 of 1988;
S 5 re-numbered as s 5(1) by s 2 of Act 8 of 1971.]

(2) Every officer or servant appointed under paragraph (a) of subsection (1) shall be deemed to be employed for the performance of duties under the Monetary Law Act, for the purpose of the application of the provisions of the said Act relating to officers and servants.

[S 5(2) ins by s 2 of Act 8 of 1971.]

(3) For the purposes of paragraph (k) of subsection (1), "expenses” shall include—

(i) any loss of moneys on account of theft, misappropriation or over-payment;

(ii) any loss of articles of furniture, office equipment or stationery used in or purchased for the administration of the Fund the cost of which cannot be recovered from the persons responsible for such loss; and

(iii) the value of any article of furniture, office equipment or stationery written off on grounds of in-service-ability.

[S 5(3) ins by s 2 of Act 8 of 1971.]

5A. Employer to communicate to member the information notified by the Monetary Board.

Where an employer is notified by the Monetary Board under section 5(1)(j), of the amount lying to the credit of the individual account of a member of the Fund, such employer shall forthwith communicate to such member the information so notified.

[S 5A ins by s 3 of Act 8 of 1971.]

6. Auditor-General to audit the accounts of the Funds.

(1) The accounts of the Fund in respect of each year shall be audited by the Auditor-General and the cost of the audit shall be paid to him out of the Fund. All payments made to him under this subsection shall be credited to the Consolidated Fund.

(2) The Auditor-General or any officer of his department authorised by him to audit the accounts of the Fund shall have access to all such books and documents as the Auditor-General or such officer may consider necessary for the purposes of the audit of such accounts, and shall be furnished by the Monetary Board and the Commissioner with such information within their knowledge or ascertainable by them as may be required for such purposes.

(3) The Auditor-General shall examine the accounts of the Fund and submit to the Minister annually a report—

(a) stating whether he has or has not obtained all the information required by him,

(b) seating whether the accounts referred to in the report are properly drawn up so as to exhibit a true and fair view of the affairs of the Fund, and

(c) drawing attention to any item in such accounts which in his opinion may be of interest to Parliament in any examination of such accounts. Such report shall not disclose the name of any member of the Fund.

(4) The Minister shall lay before Parliament a copy of the Auditor-General's report submitted to the Minister under subsection (3) of this section and copies of the statements transmitted to the Minister by the Monetary Board under paragraph (i) of subsection (1) of section 5.

7. Repayments to Government.

Every sum paid out of the Consolidated Fund—

(1) to the Commissioner prior to the date of enactment of this Act, for defraying the expenditure incurred in making preliminary arrangements for the establishment of the Fund.

(2) to the Monetary Board, for defraying all expenditure, including capital expenditure incurred by such Board and the Commissioner in carrying out the provisions of this Act during the period commencing on the date of enactment of this Act and ending on the thirtieth day of September, 1966, shall constitute a loan from the Government to the Monetary Board and shall be repaid in accordance with such terms and conditions as may be determined by the Minister with the concurrence of the Minister in charge of the subject of Finance.

[S 7 subs by s 4 of Act 8 of 1971.]

7A. Expenses incurred in the administration of the Act.

The expenses incurred by the Commissioner and the Monetary Board in carrying out the provisions of this Act shall be the Act' charged on the income from the investment of moneys of the Fund.

[S 7A subs by s 3 of Act 1 of 1985.]

PART II

Covered Employments, Employees to Whom This Act Applies, and Contributions

8. Covered employments and employees to whom this Act applies.

(1) Any employment, including any employment in the service of a corporation whose capital or a part of whose capital is provided by the Government, may by regulation be declared to be a covered employment.

(2) Regulations may be made—

(a) to treat as a covered employment any employment outside Sri Lanka which is for the purposes of a trade or business carried on in Sri Lanka and which would be a covered employment if it were in Sri Lanka; and

(b) to treat as not being a covered employment or to disregard.

(i) employment under a person who employs less than a prescribed minimum number of employees;

(ii) employment of a person in the service or for the purposes of the trade or business, or as a partner, of that person's spouse.

[S 8(2)(b)(iii) re-numbered as s 8(2)(b)(ii) by s 5 of Act 8 of 1971.]

(3) Subject to the other provisions of this Act, every person over a prescribed age who is employed by any other person in any covered employment shall be an employee to whom this Act applies. For the purposes of this subsection different ages may be prescribed for different covered employments—

(4) Any regulation declaring any employment to be a covered employment may provide that such persons only as earn less than a prescribed amount in that employment or as are of a prescribed class or description, and not other persons in that employment, shall be employees to whom this Act applies.

9. Immediate employer being himself in the employment of another person.

Where the immediate employer of any person is himself in the employment of some other person and the first-mentioned person is employed to do any work in the course of and for the purposes of the business of that other person, that other person shall, for the purposes of this Act, be deemed to be the employer of the first-mentioned person jointly with the immediate employer.

10. Normal contributions.

(1) Subject to the provisions of subsection (3) of this section and of section 27, an employee to whom this Act applies shall, in respect of each month during which he works in a covered employment, be liable to pay to the Fund a contribution of an amount equal to eight per centum of his total earnings from that employment during that month.

[S 10(1) am by s 2 of Act 26 of 1981; am by s 4(1) of
Act 1 of 1985.]

(2) Subject to the provisions of subsection (3) of this section and of section 27, the employer of every employee to whom this Act applies and who is liable to pay contributions to the Fund shall, in respect of each month during which such employee is in a covered employment under such employer, be liable to pay to the Fund on or before the last day of the succeeding month, a contribution of an amount equal to twelve per centum of such employee's total earnings from that employment during that month.

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