Has the company written in your appointment letter that Employee shall be eligibe for Super annuation or annuity scheme of the comapny and has the comapny mentioned Super annuation in CTC sheet?
It shall be appropriate if you can post the copy of appointment letter, CTC sheet. To maintain confidentiality you may erase the names etc while you scan and attach the docs. It is felt that after looking into the docs better resoloution may be possible.
Apparently either some daring HR personnel have acceeded to unfair demand of the employer to formulate and bad policy and put it into practice or these personnel have done it on their own.These HR personnel should have guided the employer and company (present and in future too) to implement good HR practices.
The original terms & conditions of your appointment letter mention your entitlement to Superannuation scheme. Employers claim tax rebate on such contributions.
As far as it is understood, no recovery can be made from such pension schemes. The employee has all the rights on it and is entitled to get the benefits.This is different from Gratuity.
Usually companies do not extend the Superannuation benefits to all employees- but only to a specific category of employees.
Under Employees’ Provident Funds and Miscellaneous Provisions Act 1952, the two main schemes, Employees’ Provident Fund and Employees Pension Scheme are mandatory. The group superannuation schemes are voluntary in nature. Typically Employers either set up trust funds to manage these schemes or buy policies from insurance firms.
Superannuation Fund is a retirement benefit given to employees by the Company. The superannuation fund is an arrangement by the employer to pay the employee an amount at the time of his leaving the organization after attaining the age of superannuation as provided in the standing orders of the organization.
The duration of service for entitlement of superannuation depends upon the Rules and Regulation of the employer.
So check the standing orders of the company, at the time of your joining and any modifications if applied. Standing orders of the company are available with concerned personnel of HR, and may be kept at HR page of employee portal, and are to be displayed at the entrance. Similarly rules of the scheme previous and modified can be obtained from HR. You may persist to get a printed copy.
The company usually pays 15-27% of basic wages as superannuation contribution. There is no contribution from employee. This contribution is invested by the Fund in various securities as per investment pattern prescribed. Interest on contributions is credited to the members account. Normally the rate of interest is equivalent to the PF interest rate. On attaining the retirement age, the member is eligible to take 25% of the balance available in his/her account as a tax free benefit. Some companies may allow up to 33%. The balance 75% is put in an annuity fund, and the agency (e.g. LIC) will pay the member a monthly/quarterly/periodic annuity returns depending on the option exercised by the member.
It is felt that LIC decides rates based on not just the superannuation fund value i.e. the amount paid to them for maintaining the superannuation fund of the company. If gratuity fund is also maintained with LIC then the gratuity fund value and superannuation fund value are combined to provide the interest rate on the fund. There are different slabs for different fund sizes and may vary every year.
This payment received regularly is taxable. In the case of resignation of the employee, the employee has the option to transfer his amount to the new employer. If the new employer does not have a Superannuation scheme, then the employee can withdraw the amount in the account, subject to deduction of tax and approval of IT department, or retain the amount in the Fund, till the superannuation age.
It is felt that answer to first question is emphatic yes and no to 2nd/3rd.
You may go thru another thread:
1.
Forum Home > Business Law > Corporate > Gratuity is a part of the ctc...???
at following link:
https://www.lawyersclubindia.com/forum/Re-Gratuity-is-a-part-of-the-ctc--55344.asp
2.
Forum Home > Labour & Service Law > Others > Misleading superannuation fund in salary component
at the following link:
https://www.lawyersclubindia.com/forum/Re-Misleading-superannuation-fund-in-salary-component-54927.asp
Kindly look into the attachments.
