We circulate herewith, for information, copy of Circular No.Coord/4(6)2003/ Clarification/Vol-II/7394 dated 23^rd May 2011 issued by the Additional Central Provident Fund Commissioner (Compliance) of Employees’ Provident Fund Organization, New Delhi emphasizing that Provident Fund contributions are not remitted on wages less than Minimum Wages, since every employer is legally bound to pay at least Minimum Wages.

Para 3 of the attached Circular says that the Order of the Division Bench of the Hon’ble Karnataka High Court upholding the view that Regional Provident Fund Commissioner examine and look into the nature of contract entered between the employer and its employees as well as the pay structure to decide whether the pay is being split up under several heads as a subterfuge to avoid Provident Fund contribution has been tentatively upheld by the Hon’ble Supreme Court vide its Order dated 23^rd July 2004.