Delhi HC Upholds Mandatory EPF Contributions for Foreign Employees
Delhi HC upholds mandatory EPF for all international workers, rejects discrimination plea.
The Delhi High Court has upheld the Centre’s controversial notifications mandating that all international employees working at Indian establishments must contribute to the Employees’ Provident Fund (EPF), regardless of their monthly salary. This verdict was delivered by a bench of Chief Justice D.K. Upadhyay and Justice Tushar Rao Gedela while dismissing SpiceJet’s petition, which argued the notifications discriminated against foreign employees and violated Article 14’s right to equality.
Under the EPF scheme, Indian employees are required to contribute only if their salary exceeds ₹15,000, but international workers must do so irrespective of earnings. The notifications also clarify that ‘international workers’ include foreign passport holders working in India, employees from countries with Social Security Agreements (SSA) with India, and Indian citizens working abroad under such agreements.
SpiceJet argued the distinction based on nationality was unjustified and could not be supported under the EPF Act, which does not define employment discrimination. The Centre countered that the policy is based on rational classification: while Indian employees may face economic hardship from mandatory lifetime contributions, international employees generally serve shorter tenures (2–5 years) and may already enjoy reciprocal social security benefits from their home nation.
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The court found the government’s reasoning sound, stating the classification was reasonable and did not violate the constitutional guarantee of equality. It held that extending mandatory EPF to all Indian employees, regardless of salary, could subject them to undue financial pressure, unlike international workers whose EPF contributions typically span shorter periods.
Legal experts say the judgment closes a long-standing debate over EPF’s application to foreign staff, especially at Indian companies with cross-border employment relationships. Employers should continue complying with EPF rules for international workers unless further court action or legislative changes arise.
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