New Delhi, Feb. 13 -- The moment Mr. A landed his first job at a tech company, he started thinking about his salary structure. With an annual package of Rs.12 lakh and a basic salary of Rs.40,000 per month, he wondered if he really needed to contribute to the Employees' Provident Fund (EPF). Across town, Mr. B, newly employed at an MSME with a Rs.5 lakh annual salary and a basic salary of Rs.14,000 per month, had heard about the challenges of withdrawing EPF funds and wanted to know if he could skip it entirely.

The answer isn't straightforward. While Mr. A has the choice to opt out, Mr. B doesn't-thanks to the rules governing EPF eligibility.

Most new employees can opt out of EPF if their basic salary, as defined by the EPF Act, exceed...