Notice to Punjab Health Agency on EPF scam

Vishav Bharti

Chandigarh, December 4

Another scam has rocked the State Health Agency as the company responsible for providing manpower to run a health insurance scheme has allegedly gobbled up nearly Rs 3 crore of around 300 employees which was to be deposited in their Employees’ Provident Fund (EPF) accounts.

What the rules say

• The Employees’ Provident Funds & Miscellaneous Provisions Act, 1952, applies from the day the employee strength first crosses 19.
• This includes contractual staff and/or casual labour, even if the total strength may thereafter reduce.
• Subsequently, the employer is statutorily bound to remit PF contributions of all employees every month.

In a communication to the government-run State Health Agency (responsible for running the insurance scheme), the EPFO has termed it cheating.

For the smooth functioning of the Ayushman Bharat Sarbat Sehat Bima Yojana, the State Health Agency had hired “arogya mitras” through outsourcing. These arogya mitras were posted in each government hospital and they were responsible for guiding patients to get cashless treatment under the scheme. In February 2020, for providing around 300 arogya mitras, the government gave a contract to a private company, MD India Health Insurance Pvt Ltd.

However, there were serious allegations against the company that it was not paying the minimum wages and was even refusing to deposit the provident fund and pension fund of the contractual employees, which is a statutory requirement under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.

Interestingly, these employees had been working with the company for the past 32 months, but it never opened their EPF accounts.

Some employees submitted a complaint to the government, which initiated an inquiry in which it was found that the outsourcing company was denying EPF and pension benefits to these employees. “This is nothing but fleecing underpaid workers. The State Health Agency has failed to protect their rights,” said Bhagwan Dass, an RTI activist and complainant in the case.

The EPFO has now issued a notice to the State Health Agency and said the company was cheating the state EPFO, the ESIC and the Labour Department. The EPFO has asked the government to provide the EPF code of the company so that action can be initiated against it.

Dinesh Kundu, manager of the company who takes care of its operations in Punjab, said arogya mitras worked as consultants. “We deduct their TDS, but not EPF and ESI,” he said. Contrary to the claims of the company, arogya mitras work as full-time employees who work from 8 am to 6:30 pm six days a week.