Provident Fund for the private sector employees

During the 1st Question Hour of the National Council I had posed two questions with two other follow-up questions.

The Ministry of Labour and Human Resources had released in November 2009 14 rules and regulations to implement the Labour and Employment Act 2007. One of these rules and regulations was on Provident Fund for the private sector employees.

Q# My first question was about the inclusiveness of the consultative process before the rules were drafted.

To which the Labour Minister stated that the consultative process involved 1055 people across 10 dzongkhags and stretched over 2 years. In terms of representation of employer and employee, 60% from employers and 40% from employees as a primary player in the success were the employers.

Q# My second and follow-up questions were about provisions in the rules which states strict penalties on non-compliance. Even though some entities have been seen to start PF schemes in their organizations, the compliance has not been ideal. In order that private sector employees benefit from the intended law and rule, was the government ready to levy penalties was one question. Another was, if the government thought the private sector was not ready for total compliance for various reasons, did it have a planned time-line for implementation for the benefit of everyone to plan accordingly?

To this the Minister replied that although provisions for levying penalization under various clauses of the rule were possible, the government will not be exercising them. This he said was partly because agencies that have not been able to comply were mostly smaller ones. In addition, “dzongkha” version of the rules and regulations had not been distributed as yet and after distribution (it was mentioned that it was now ready), the government may consider options, although there were no planned implementation time-line for it.


About Sangay Khandu

Elected to Parliament of Bhutan twice. Previously worked with the Central Bank, the largest SoE (power utility) and international organization.
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3 Responses to Provident Fund for the private sector employees

  1. bala subrahmanyam says:

    I am working in a retail store. My total salary is 15,000/-( incl incentives). i am eligible for pf or not.
    M.Bala Subrahmanyam

    • Before I try and respond to your query Mr. M.B Subrahmanyam, thank you for writing to me.

      According to law and rules on labour and employment in Bhutan, the eligibility of any employee to provident fund is dependent on the nature of employment in addition to the size of the employing agency. The Ministry of Labour and Human Resources had drafted a guideline requiring provisions of Provident Fund for private sector employees like in the public sector. And like I mentioned earlier there are two things primarily which could decide your eligibility; (1) What are your terms of employment? Regular or non-regular. (2) How big is your workplace? Does it employ more than 12 people or less.

      I would also recommend you try reading materials on this site and may also try contacting the Labour Relation office under the ministry.

      Good luck

  2. shibu rudra paul says:

    i realy like this

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