New Delhi: In a landmark ruling, the Delhi High Court upheld the mandatory enrolment of foreign employees in India’s Employee Provident Fund (EPF) scheme, dismissing writ petitions filed by SpiceJet and LG Electronics.
The court, presided over by Chief Justice Devendra Kumar Upadhyay and Justice Tushar Rao Gedela, affirmed the constitutional validity of the 2008 and 2010 notifications extending the EPF Act, 1952, to international workers.
The 2008 notification introduced Paragraph 83, mandating EPF contributions for non-exempt international employees, while the 2010 amendment clarified their inclusion from the date of joining. SpiceJet challenged a 2011 demand notice for dues and a 2012 summons for contribution assessment, arguing that the rules discriminated against foreign workers by mandating contributions regardless of salary, unlike Indian employees earning above ₹15,000 monthly. LG raised similar objections, citing impractical withdrawal rules for short-term expatriates.
The court rejected these claims, stating that the classification of foreign workers is constitutionally permissible and grounded in economic rationale. It dismissed concerns over withdrawal conditions, noting their alignment with India’s international treaty obligations under Social Security Agreements (SSAs). The bench also disagreed with a Karnataka High Court ruling, reinforcing the legal foundation of the notifications.
This decision strengthens India’s social security framework for foreign workers, ensuring equitable treatment. The court upheld subsequent circulars and notices, dismissing the petitions entirely. The ruling has a major influence on multinational corporations operating in India, reinforcing compliance with EPF regulations for their international workforce.