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Informist, Thursday, Mar. 12, 2026

 

NEW DELHI – The Supreme Court Thursday issued notices to the Centre, the Employees' Provident Fund Organisation and others on LG Electronics India Ltd.'s plea challenging the law that required every international worker, other than excluded employees, of an Indian establishment to which the Employees' Provident Fund Scheme applied to become a member of the Employees' Provident Fund. The top court directed the EPFO to not pass a final order against LG Electronics under Section 7A of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 while the case was being heard. It listed the case for hearing on Mar. 20.

 

On Nov. 4, the Delhi High Court had upheld the central government's 2008 and 2010 notifications making the Employees' Provident Fund Scheme 1952 applicable to international workers with certain modifications. It had rejected LG Electronics' challenge to a letter by the Employees' Provident Fund Organisation, asking the company to deposit the provident fund and other dues in respect of international workers. It had also rejected the company's challenge to summons issued by the organisation, requiring the company to appear to give evidence and produce all relevant records for determination of provident fund and related dues payable by it in respect of international workers employed by it.

 

LG Electronics had argued that requiring international workers to become members of the EPF and contribute to the fund was discriminatory. The company reasoned that an Indian employee was required to contribute to the EPF only if drawing less than INR 15,000 per month whereas non-excluded international employees were required to contribute to the fund irrespective of the pay being drawn by them.

 

The high court had, however, agreed with the government's argument that such classification was based on the fact that foreign employees do not face economic duress if they are made members of the 1952 scheme as they come to India for employment for short periods of two to five years. Indian employees generally serve until they attain the age of superannuation and because of such long duration of employment, they could face economic duress if mandated to contribute to the scheme, said the high court. It noted that the classification done was reasonable and also met the objective of providing social security.

 

Through the notifications, the government cast a duty on every employer to send to the EPF commissioner a consolidated return in such form as the commissioner may specify in respect of international workers. This return should depict certain information regarding basic wage, retaining allowance, and dearness allowance, the government said. It had also permitted international workers to withdraw the full amount standing to their credit in the EPF on retirement from service at any time after attaning the age of 58 years, or on account of permanent and total incapacity for work due to some infirmity.  

 

At 1412 IST, shares of LG Electronics India Ltd. were down 0.9% at INR 1,580.00 on the National Stock Exchange.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Surya Tripathi

Edited by Avishek Dutta

 

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