Some 10,000 Sri Lankan employers default ETF payments
About 10,000 Sri Lankan organizations are defaulting every month in their Employees Trust Fund (ETF) payments and most of these defaulting firms are based outstation, according to officials.
“There’s a 21 per cent default rate overall and most are from outstations,” J.M.S.B. Udugama, Deputy General Manager, Collection and Employer Relations, ETF told the Business Times on the sidelines of a Colombo seminar on ‘EPF and ETF Acts and Employee Benefits’ on Tuesday.
He said that the compliance rate of employers seem to have improved overall and it is about 79 per cent, but compliance of employers with establishments out of Colombo are quite low.
B. Wasanthan, Deputy Commissioner of Labour – Employees Provident Fund (EPF) told the Business Times that 192 cases were filed against employers in April, while 868 first notices (warnings) were sent and 626 red notices or final warnings were sent.
Mr. Udugama said that there are 9.6 million ETF member accounts out of which 2.2 million are active employee accounts. “There’s a high figure because some maintain more than two or three accounts,” he said. Mr. Wasanthan said that 1.5 million active accounts are maintained in ETF.
In his presentation, Mr. Wasanthan said that 20% of employers remit EPF contributions after the prescribed time and that 5732 employers paid late. Annually the late payment figure is 174394.
Explaining the rights of EPF members, he said that every member of the fund is entitled to withdraw 30 per cent of the amount from his account. For those who have made contributions for 10 years, are presently employed and possess Rs 300,000 in the account have special benefits.
They can claim medical treatment for things such as heart surgery, by-pass surgery, treatment for cancer including surgery, kidney transplant or surgery , cesarean operation, hospitalization for more than 14 days on accountant of an accident, etc.
Mr. Wasanthan said that the members are entitled to loans for housing requirements which include the construction of a house on a land belonging to a member, the purchase of a land for the construction of a house, the purchase of a house, the redemption of mortgage on housing, housing property and the cancellation of an outstanding balance of the house loan received from an approved bank.
Explaining the duties of the employer relating to EPF, he said that registering EPF members within 14 days of employment stands first.
He declined to comment on the investment decisions by the EPF in some low-priced stocks.
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