A Provident Fund in a Religious Madrasa

Question

Nowadays, not only in worldly factories and colleges but also in some religious madrasas, a certain amount is withheld every month from the salary of those who are teachers or employees (and this withholding is with their consent) — for example, ten rupees are withheld every month — and the madrasa, for its part, adds the same amount and deposits it into a fund, and this fund is called the provident fund.

Answer

With the consent of the teacher or employee, it is proper to accumulate part of the salary and then, at the end of employment, to pay out the accumulated amount together with an increase. This increase is a reward (inʿam) on account of good service.

Source: Fatawa Mahmudiyya

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