Section 16 EPF Act 1952: Establishments Excluded from EPF Coverage
Section 16 of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 historically identified establishments to which the EPF Act did not apply. The legal framework changed when the Code on Social Security, 2020 came into force on 21 November 2025.
Meaning of Section 16 of the EPF Act 1952
Section 16 was an exclusion provision. Instead of granting an individual exemption on application, it declared that the EPF Act did not apply to specified categories of establishments when the statutory conditions were satisfied. It covered certain small co-operative establishments, specified Government establishments, and establishments created by statute where employees already received qualifying provident fund or old age pension benefits.
Section 16(2) separately empowered the Central Government, after considering the financial position of a class of establishments or other circumstances, to exempt that class by notification, subject to stated conditions and for a specified period.
Historical Section 16: Act not to apply to certain establishments
Section 16(1). The EPF Act did not apply to:
(a) an establishment registered under the Co-operative Societies Act, 1912, or a State law relating to co-operative societies, where it employed fewer than fifty persons and worked without the aid of power;
(b) an establishment belonging to or under the control of the Central Government or a State Government where employees were entitled to contributory provident fund or old age pension benefits under a Government scheme or rule; or
(c) an establishment set up under a Central, Provincial or State Act where employees were entitled to contributory provident fund or old age pension benefits under a scheme or rule framed under that enactment.
Section 16(2). The Central Government could, by notification in the Official Gazette and subject to specified conditions, exempt a class of establishments prospectively or retrospectively for a specified period where its financial position or other circumstances made such exemption necessary or expedient.
Current law: Section 20 of the Code on Social Security 2020
From 21 November 2025, the corresponding exclusion is contained in Section 20 of the Code on Social Security, 2020. Section 20 applies specifically to the provident fund chapter of the Code.
| Provision | Current rule |
|---|---|
| Section 20(1)(a) | Excludes a co-operative society establishment employing fewer than fifty persons and working without the aid of power. |
| Section 20(1)(b) | Excludes qualifying Central or State Government establishments whose employees receive contributory provident fund or old age pension benefits under the applicable Government scheme or rule. |
| Section 20(1)(c) | Excludes qualifying establishments set up under a Central, State or other law where employees receive contributory provident fund or old age pension benefits under a scheme or rule framed under that law. |
| Section 20(1)(d) | Adds an exclusion for employees who, immediately before commencement of the Code, were receiving provident fund benefits under a Central or State enactment. |
| Section 20(2) | Allows the Central Government to exempt a class of establishments from the provident fund chapter, prospectively or retrospectively, by notification and subject to specified conditions and period. |
Key continuity and change after repeal of the EPF Act
The principal categories formerly found in Section 16(1)(a) to (c) substantially continue in Section 20(1)(a) to (c) of the Code. The Code also contains Section 20(1)(d), addressing employees who were already receiving provident fund benefits under a Central or State enactment immediately before commencement.
Section 164 of the Code repeals the EPF Act, but it also contains savings provisions for actions, schemes, notifications, exemptions and other matters covered by the repealed enactments, subject to the terms of the Code. Accordingly, older Section 16 material remains relevant for historical periods and for understanding matters governed by the repeal and savings provisions.
Historical Section 16A: Authorising certain employers to maintain provident fund accounts
The original page also covered Section 16A. Historically, Section 16A allowed the Central Government, on an application by the employer and the majority of employees of an establishment employing one hundred or more persons, to authorise the employer in writing to maintain the provident fund account subject to the Scheme and specified conditions.
No such authorisation was to be granted where the employer had defaulted in provident fund contributions or committed another offence under the EPF Act during the preceding three years. An authorised employer had to maintain accounts, submit returns, deposit contributions, provide inspection facilities, pay administrative charges and comply with the Scheme. The authorisation could be cancelled for breach or an offence, but only after giving the employer a reasonable opportunity of being heard.
Official legal resources
For the current statutory text and commencement position, consult the official Government sources below. Because this page preserves historical Section 16 material, the current Code should be checked before relying on the former EPF Act provision for a present-day matter.
India Code - Code on Social Security, 2020
Ministry of Labour and Employment - Code on Social Security, 2020
India Code - Employees' Provident Funds and Miscellaneous Provisions Act, 1952 historical text
Note: This article is a general statutory reference. Applicability to a particular establishment can depend on its legal character, employee benefits, notifications and transitional provisions.