Employee Welfare Fund is established and managed by the Employee Welfare Fund Committee and has the same objective as the Provident Fund, which is to provide financial security for employees in case of resignation or termination, and for their legal beneficiaries in case of death.
Employers with 10 or more employees must subscribe the Fund and make contributions.
An employer who is making contributions to a Provident Fund or provides welfare for its employees in case of resignation or death, is not required to register with the Employee Welfare Fund.
Both the employer and the employees are required to make contributions. The contribution amount must be in accordance with the rates prescribed by the Ministerial Regulations but must not exceed 5% of the employee’s wages.
If the employer fails to pay the contributions or fails to pay in full amount by the due date, he will be required to pay the outstanding contribution amount, as well as an additional penalty of 5% of the unpaid contribution per month of deficiency.