TeamLease Services Limited filed a Writ Petition on May 12, 2026, with the Hon'ble High Court of Karnataka, challenging a Show Cause Notice (SCN) issued by the Employees' Provident Fund Organisation (EPFO). The SCN, dated April 13, 2026, and received by the company on April 23, 2026, pertains to alleged contraventions in the administration and management of funds by the Employees' Provident Fund Trust. The company disclosed this development to the stock exchanges pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and in accordance with SEBI Master Circular SEBI/HO/CFD/PoD2/CIR/P/0155 dated November 11, 2024.

Details of the EPFO Show Cause Notice

The following table summarises the key details of the Show Cause Notice as disclosed by the company:

Nature of Allegations

The EPFO's Show Cause Notice alleges certain contraventions in relation to the administration and management of funds by the Employees' Provident Fund Trust. The key observations cited in the notice include:

• Investment Losses
• Losses on sale of Bonds and Debentures
• Misappropriation of Reserves
• Certain employee-related amounts reflected as recoverable, for which supporting documentation has been sought

Company's Position and Legal Action

TeamLease Services disputes the quantum of the claim as stated in the notice. The company has noted that prior to the surrender, it had sought clarification from the Regional Provident Fund Organisation, Bengaluru (Central), wherein the employer is allowed to fund only to the extent of the shortfall arrived as per the Balance Sheet, and the same was funded on March 30, 2022. The company has stated that it is working closely with the department to resolve the demand.

In response to the SCN, the company filed a Writ Petition with the Hon'ble High Court of Karnataka on May 12, 2026, ahead of the hearing scheduled on May 13, 2026. TeamLease Services also noted a delay of 5 days in submitting this intimation to the stock exchanges, attributing it to unavoidable administrative exigencies and the time taken to ascertain the materiality threshold of the Show Cause Notice. The company is currently evaluating the notice and will take appropriate legal action, reaffirming its commitment to ensuring full compliance with applicable laws and regulatory requirements. TeamLease Services has stated that it will keep the stock exchanges duly informed of any material developments in this matter.

TeamLease Services Limited has filed an appeal with the Hon'ble High Court of Gujarat against an order issued by the Employees' Provident Fund Organisation (EPFO), Ministry of Labour and Employment, Government of India. The appeal was filed on May 06, 2026, pursuant to a disclosure made under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The filing was signed and submitted by Alaka Chanda, Company Secretary and Compliance Officer.

Background of the EPFO Order

The EPFO order in question was issued under Para 26B of the Employees' Provident Fund Scheme, 1952, and is dated March 11, 2026. It was issued by the Regional Provident Fund Commissioner, Vadodara, and pertains to TeamLease Skills University (TLSU) — India's first vocational education and training university, established in Gujarat in 2013 under the Gujarat Private Universities Act, 2009, as a Public-Private Partnership with the Government of Gujarat. TeamLease Foundation (formerly known as TeamLease Education Foundation), a subsidiary of TeamLease Services Limited, acts as the sponsoring body of TLSU.

The key details of the regulatory action are summarised below:

Nature of the Dispute

The core dispute revolves around whether NEEM (National Employability Enhancement Mission) trainees deployed by TLSU to various client locations should be classified as "employees" under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952. The NEEM scheme was launched by the Department of Higher Education, Ministry of Education, under the All India Council of Technical Education, dated April 15, 2013. As per the amended NEEM Guidelines dated June 15, 2017, trainees under this scheme are expressly excluded from being treated as employees for the purposes of statutory social security legislations, including Provident Fund and Employee State Insurance.

The relevant clause of the NEEM Guidelines states:

"Remuneration/Stipend shall be paid as a single consolidated amount and such payment will not attract any statutory deductions or payments applicable to regular employees i.e. PF/ESI etc., since the NEEM contract assures training and does not constitute employment."

The EPFO authorities, however, have taken the view that NEEM trainees should be treated as "employees" under the EPF Act. Initially, proceedings were proposed under Section 7A of the EPF Act, which pertains to assessment and determination of Provident Fund dues. Following TLSU's representation that applicability of the EPF Act itself needed to be determined first, proceedings were subsequently initiated under Para 26B of the EPF Scheme, 1952, which specifically deals with the determination of applicability.

Financial Impact and Contingent Liability

The EPFO order under Para 26B is limited to determining applicability and does not quantify any provident fund dues, interest, damages, or financial liability. Accordingly, the company has stated that there is no immediate or ascertainable financial impact as on date. The matter has been disclosed as a contingent liability under Note 46.7 in the consolidated financial statements for FY25.

The company also noted that since the order was received prior to the SEBI amendment dated June 14, 2023 — which mandated intimation to stock exchanges upon receipt of any demand order or notice — no earlier disclosure was made. The current disclosure is being made in connection with the filing of the appeal before the High Court.

Appeal and Legal Proceedings

TLSU has challenged the EPFO order before the Hon'ble High Court of Gujarat and will be seeking an appropriate stay on the operation of the order. The company cited a precedent in its favour: in a similar matter relating exclusively to NEEM trainees, TLSU had earlier obtained a favourable interim stay from the Hon'ble High Court of Madras. Given that the present case rests on identical facts relating to the NEEM Scheme, the company has stated it is optimistic of obtaining similar relief.

TeamLease Services Limited has stated that it remains committed to ensuring full compliance with applicable laws and regulatory requirements and will keep the stock exchanges duly informed of any material developments in this matter.

Source: None/Company/INE985S01024/1eb032074e244520.pdf