According to current EPFO rules, linking Aadhar with individual provident fund accounts is mandatory. However, many employees are quoting the SC order from September 2018 to avoid linking Aadhar to EPFO.
A number of MNCs have sought help from the government seeking clarification of norms related to Aadhar linking with PF accounts after their employees refused to link their Aadhar numbers with their provident fund accounts.
At a recent meeting with the Karnataka Labour Minister in Bengaluru, an executive from HP explained that the company was struggling to implement the mandate of the EPFO to link Aadhar with provident fund accounts. Many employees are citing the Supreme Court order from last year and pointing out that any such linking is optional. Thy refuse to link their Aadhar numbers with their individual PF accounts. However, the EPFO mandates that the companies need to collect and link the unique ID. The executive confessed that they are in a quandary and that this situation was happening across companies.
In September 2019, the Bombay High Court granted interim relief from prosecution to JP Morgan Services India Pvt Ltd for not sharing the Aadhar and bank details of its staff with the EPFO. The company was forced to move a division bench seeking to quash a criminal complaint filed against it by the EPFO for not complying with its orders.
Employees from JP Morgan and Oracle are also receiving reminders from their respective employers to link their Aadhar numbers with their PF accounts. The employees of these tech companies have also reportedly revealed that they have received warnings from their companies. The companies are planning to take disciplinary action against them if they do not link their Aadhaar numbers with their PF accounts.
Karnataka Labour Minister Suresh Kumar has promised to take up the issue with the union labour ministry. He admitted that the PF department does not come under the ambit of the state government and that they have decided to write to the Union labour ministry and draw its attention to the issue.
In September 2018, while upholding the constitutionality of the Aadhaar Act, the SC had said any private ecosystem should not use the unique ID for authentication. It also said it cannot be made mandatory for the delivery of several services, including pension.
A software professional, Elisha Ebenezer is also challenging the notification which has mandated linking of Aadhaar to Universal Account Number (UAN) for availing pension and provident fund benefits in the Madras High Court. He further believes that EPFO’s notification is unconstitutional and against SC directives. Ebenezer who declined to identify his employer, shared that his employer is unable to contribute to his PF account as the EPFO isn’t allowing the company from creating a PF account in the absence of Aadhaar.
Meanwhile the EPFO claims that they are bound by the November 2018 notification of the Unique Identity Authority of India (UIDAI). While talking to ET, additional central PF commissioner Pankaj Raman, EPFO, said that UIDAI’s notice allows the usage of Aadhaar-based authentication for employee PF accounts.
While companies on their part are trying to ease out things for its employees, EPFO suggests that they will soon introduce a facility that will enable employees to create the universal account number (UAN) on their own and link it with the Aadhaar. This will help remove apprehensions among employees as they do not have to part with the Aadhaar number. An EPFO official, who refused to be identified, clarified that the EPFO does not maintain a database of Aadhaar numbers and that it is only used to authenticate credentials of employees on the UIDAI database.