Poor coverage of EPF in knitwear units worries trade unions

Tirupur: While linking of the Unique Account Number (UAN) with Aadhaar is happening in full swing in the knitwear cluster, trade unions have raised concern that only about 40% of the employees are covered under the Employee Provident Fund (EPF) scheme.

More than six lakh people are employed in the 6,500 knitwear or related units in the dollar city. But, so far, only 2.3lakh are covered in the EPF scheme. “Linking of UAN with Aadhaar is a good move. The employees could withdraw the EPF quickly. Otherwise, they have to approach the employers, besides submitting two forms. But the major issue is the coverage,” said CITU general secretary G Sampath. “In many units, only 10-20% employees have been covered under EPF. Many units have failed to provide contribution-12% of an employee’s wage, and record lesser wage than what was given to them. Those units would pay only the share deducted from the employee’s salary to the EPF organisation,” Sampath said.

Owner of a knitwear unit said, “Since the business is seasonal, employees would work in different units in a year. Many would request not to deduct their EPF, but include them with their wages.”

But Sampath said, “The employees would take such a stand mainly because of discrepancies in EPF coverage made by the units. Many units would not allow the employees to withdraw the EPF amount. If the government can bring all the units under GST, why cannot they ensure that the same units implement the EPF scheme?”

Tirupur Exporters’ Association (TEA) president Raja M Shanmugham said that most of the export units have brought employees under EPF scheme or initiated action.

“Only ancillary units are yet to act properly on this front. But the situation is improving, and soon all the units will follow suit.”