EPFO: What are NCP days in the provident fund?

23 Feb, 2024

Non-Contributory Paydays (NCP) play a crucial role in the Provident Fund (PF) framework, denoting days when employees are absent from work without earning wages, leading to no contribution to their provident fund accounts. During NCP days, PF contributions are not debited into the employee's account, as explained by Amjad Khan, Executive Director at Anand Rathi Insurance Brokers. It's important to note that certain types of leave, such as casual leave (CL), paid leave (PL), maternity leave (ML), or authorized leaves, do not fall under the NCP period.

The absence of contributions during NCP days can significantly affect the total accumulated amount in an employee’s provident fund account, impacting their retirement savings. Accurate calculation of NCP days is essential and typically managed by the HR department to ensure precise determination of PF contributions. This involves documenting various scenarios like approved leave, unauthorized absence, or leaves exceeding defined maternity leave periods. By understanding and accurately calculating NCP days, both employees and employers can ensure the proper operation of the Provident Fund scheme, ultimately securing financial stability for employees during their retirement years. 

Full article at Business Today.

Stay updated with labour law compliance, access Knowledge Base.

Publisher: Suma | Bizprout Expert Systems Pvt. Ltd