Dear Members,
We need counsel about the subject “PF Applicability on Volunteers’ Honorarium Payment. The volunteers are not on rolls and there is no control over their attendance and they work for their village development in association with an NGO for a period of one year. Will that NGO has to contribute towards PF for their payment ranges from Rs.600 – Rs.1200/-? Likewise thousands of volunteers are associated with that NGO.
With Regards,
Prasanna Bollam
Out of curiosity, I have a question. Government has many such name-sake-technically volunteers but otherwise, an exploitation of job market. Are they paying PF?
Coming to our sector, why beat around the bush and technicalities. If we are true Voluntary Organisations our act under which we are registered (only I am taking about them) we can just ignore all these…and we have active good governing bodies, no PROBLEM….even if technically, we are wrong. Again, self governed democratic structures will add sauce. What GUPTA said is harshly said but fairly true.
In an organisation, all are volunteers and we just employ few donkeys as staff to do clerical job for whom we may not get volunteers but essential. So, our size and area of operation should be accordingly sized. Why not we all stop calling ourselves as NGOs first. Then, entire discussion will take a churning different turn.
A workshop on Volunteerism…to redefine, no one has guts and wits to organise or participate.
Regards,
V.B.Chandrasekaran, Chatti Mahatma Gandhi Aashramam,
Chatti Post, Chinthur Mandal, East Godavari District,
Andhra Pradesh, Pin Code: 507129.
NGOs, as pointed out – some ARE good. Funds are limited so work through “volunteers” is cost effective and reduces the need for staff. It is true that these volunteers are on low pay anyhow and we just reimburse some out of pocket expenses. But the practibility of registering hundreds with PF, (then ESI will kick in) is a problem. By their nature the volunteers come and go. Can it be done, will the volunteers want it, would it be better to pay them a bit more.
To run by staff – these days you need good people and have to be paid. We are the NGO sector and not all bad. How much will it cost us to employ a person to manage hundreds of FF records? I would really like to know
This is the practical problem and needs to be addressed. Also they are not full time service providers and may work 3 hours on some days 10 hours on say a training event and some days no work at all. NGOs good or bad may/can go around the law or issue, but what would be the right thing to do.
Dear All,
This is a very tricky issue. As correctly pointed out, the moment a employee – employer relationship is established the PF Law will become applicable. There were certain exemptions till March 2015 but the Government has not removed any kind of exemptions and all organizations that have employees in excess of 20 attract the PF Act. I have come across many NGOs, who to avoid the PF give work contracts to the staff and deduct 1% TDS.
It is important that NGOs like other organizations have a salary structure and apply the PF as applicable to each staff instead of brushing the same under the carpet in the garb of honorarium/consolidated salary etc. The same is the problem when it comes to the applicability of PT.
It is high time that the sector stops playing the victim card.
Thanks and regards,
B V Soma Sastry
Dear Prasanna,
Basically issue is of definition of employees, since PF is applicable on employees, whether volunteers can be classified as employees. Issue that needs to be looked at is, are the ‘volunteers’ working on a regular basis under the guidance and supervision of the concerned NGO or are they free to come and go as they please. If you come to a conclusion that these persons are totally volunteers who are free to decide whether they want to come or not, then they would be treated as volunteers, however if they are under compulsion to attend and receive pecuniary gains, however small, in lieu of the services performed then PF will become applicable on them. Unless they work totally for free and all that the NGO has done is given them some gratuitous amount to help them for their travel expenses, etc. NGO must not be under compulsion to give this amount.
For your guidance, I may add that if an organisation is registered for PF and if a casual worker works even for a single day in the year, PF becomes applicable on the amount that worker has earned.
Most NGOs face this issue, but often we brush it under the carpet. Hope the topic raised by you will generate some debate to provide better clarity in the group.
Dear Sir,
As per my views PF is not applicable on “honorarium to volunteers”, Volunteers are not covered under the definition of Employee’s. They are not on regular Pay-Scale and are not bound to attend duties regularly as per office timmings.
Honorarium is paid to them to meet local expenses which is incurred by them. Therefore it is not consider for PF deduction.
With regards,
D.N. Surati
Chief Accounts Officer,
Nehru Foundation for Development,
Ahmedabad
Dear Surati,
As you started with ‘as per my view’ please note that the view is formed on the basis of solid support document as is required under any law. The PF laws are very very clear it is applicable to all and sundry if employee and employer relationship exists. In case of regular and hefty amounts are being paid called by whatever name (honorarium etc.) no one can escape provisions of the PF Act. Mr. Chandrasekaran has rightly pointed out that NGO are no longer VOLUNTARY ORGANIZATION then why they wishes to claim so. If NGOs are working just like any other organization there should not be any exception whatsoever to them. NGO often cry and complain if some relaxation is given to some industry but they always want every kind relaxation for themselves as if they are out of the world thing. Even FCRA compliance which are so simple NGO are crying that government want to clamp down on them. There are no punishments, penalties are under FCRA as compared to other commercial laws such as Companies Act. The time has come that NGOs and their founders chief functionaries are made liable and penalized and prosecuted for their wrong doings. All NGOs (probably no exception) splurging monies on Air travel, five-star boarding & lodging consuming costly Whiskies & Wines, where is VOLUNTARY CULTURE.
The last line of Mr. Gupta’s comments are derogatory in nature. He says all NGOs with no exception are splurging money. How many NGOs he has come into contact with or knows about? With his knowledge of a few bad NGOs he should blame the entire development community with such words. There are many genuine NGOs really working for the people in the remote rural areas with no transport facility except bus or bike. Let him not generalise things.
Then why are NGOs willing to come forward to dialogue on the relevance of Volunteerism? Why are all organisations exclusive to peoples’ agenda but follow only the agenda of Funding agencies? WE are willing to host at no cost a workshop for three days on Volunteerism and what are supposed to be our activities and who should decide and how it should be evolved. I know, all will laugh if not smile but keep quite.
Regards,
V.B.Chandrasekaran, Chatti Mahatma Gandhi Aashramam,
Chatti Post, Chinthur Mandal, East Godavari District,
Andhra Pradesh, Pin Code: 507129.
We strongly believe that some thing is basically gone wrong in our sector that we are forced to ask such questions. We are a registered VOLUNTARY ORGANISATION and who changed our name as NGO? Kindly read the act and our own bye laws. All of us are volunteers and PF is just not needed for anyone of US. But, we have entered GREY area of taking huge sums as salaries, consultation fees et al and literally we have become service contractors.
In our opinion, either we follow the “spirit” behind what Lala Lajpat Roy said- “Volunteers are the ones who lives just above the poverty line of the communities with whom we are working” OR JUST PAY PF TO ALL.
We have shaken our core value of Volunteerism and instead of fairly remaining free from government controls, we are sucked into it. Simple life, Voluntary Poverty and such values will enhance our moral stature.
PAY ALL OR PAY TO NONE. THAT IS IT. OKAY.
V.B.Chandrasekaran, Chatti Mahatma Gandhi Aashramam,
Chatti Post, Chinthur Mandal, East Godavari District,
Andhra Pradesh, Pin Code: 507129.