EPFO - Employee Provident Fund Organization Last Updated : 29 May 2020

The Employees’ Provident Fund Organisation (EPFO) is a non-constitutional body that promotes employees to save funds for retirement. The organisation is governed by the Ministry of Labour and Employment, Government of India and was launched in 1951.

The schemes offered by the organisation cover Indian workers and international workers (from countries with whom the EPFO has signed bilateral agreements).

For more information, Check out related articles EPFO Login, UAN Login, EPF Balance & EPF Claim Status

EPFO
Employee Provident Fund Organization

Schemes Offered Under the EPFO

Given below are the various schemes that are present under the EPFO:

  1. Employees’ Provident Funds Scheme 1952 (EPF)
  2. Employees’ Pension Scheme 1995 (EPS)
  3. Employees’ Deposit Linked Insurance Scheme 1976 (EDLI)

The schemes are explained below:

1. Employees Provident Fund (EPF) Scheme 1952

This scheme provides an accumulation of funds that can be used by members after their retirement or can be used by their families in case they pass away.

2. Employees’ Pension Scheme (EPS) 1995

This scheme provides pension is provided on a monthly basis after the member retires, faces a disability, or the pension will be given to the widow or children in case the member passes away.

3. Employees Deposit Linked Scheme (EDLI) 1976

Under this scheme, in case an employee who is a member of the EPFO passes away during employment, benefits will be provided. Benefits of up to 30 times the salary of the employee up to a maximum of Rs.6 lakh will be provided.

Restored pension to be disbursed by the EPFO from the month of May

Individuals who have opted for commutation during at the time of their retirement will be given full pensions from the month of May by the Employees’ Provident Fund Organisation (EPFO).

Commutation is provided to pensioners who convert a certain amount of their monthly pension. The amount is paid as a lump sum at the time of retirement. The full amount is restored after 15 years. The announcement in regards to the restoration was made in February. Around 6,30,000 pensioners will be benefited from this move. The move will cost the government around Rs.1,500 crore at a time the country is facing a resource crunch due to the coronavirus outbreak and the subsequent lockdown. The EPF and the EPS scheme are handled by the EPFO, which in turn comes under the Labour Ministry. The process of aligning the software has been done quicker during the time of the coronavirus outbreak. The main aim of updating the software is to ensure that the pension is processed quicker. According to a senior government official, even though the notification was given in February, it took months for the software to be updated. The official further added that it is ready now for disbursal. Current EPFO members, as not eligible for commutation under the EPF rules.

EPFO account holders can update exit date online after a job change

The Employees’ Provident Fund Organisation has now enabled a feature on the official website that allows users to update their ‘'date of exit’', after changing jobs, online. This facility was not available to employees previously. It was only employers who were able to update their exit dates online.

Steps to update your date of exit online

  1. Visit the EPFO’s official website
  2. Log into your account using your Universal Account Number (UAN) and password
  3. Navigate to the section called ‘'Manage’'
  4. Click on ‘'Mark Exit’'
  5. This will give you a dropdown menu on ‘'Select Employment’' from where you can select your PF account number
  6. Fill in your date of exit and reason for exit
  7. Click on ‘'Request OTP’'. The OTP will get sent to your mobile number linked to your Aadhaar card
  8. Enter the OTP
  9. Select the checkbox
  10. Click on ‘'Update’' and ‘'Ok’'
  11. You will receive a message confirming that the date of exit has been successfully updated
  12. Now navigate to the ‘'View’' section and under that, ‘'Service History’'
  13. You can now see the date of joining and exit from both your EPS and EPF accounts

Note that you can mark your date of exit only after 2 months of leaving your place of employment.

Importance of updating the exit date

Updating your exit date is important for claims submissions and settlements later. If your exit date is not updated or is mentioned inaccurately, then your employment will not be marked continuous and you would have to pay tax on the interest that is earned during the intervening period.

Aims of EPFO Vision 2030

One of the aims of the EPFO is to become one of the best Social Security Organisations in the world by meeting the requirements of its stakeholders and by providing futuristic services. Given below are the aims of EPFO Vision 2030:

  • Universal Social Security Coverage in the form of Life Insurance, Pension, and Provident Fund is provided to all workers in India on a compulsory basis.
  • New policies that provide a benefit structure with social security support at a reasonable level must be initiated.
  • All EPFO benefits must be easily accessible online with State-of-the-Art technology.

Objectives of EPFO

Given below are the main objectives of the EPFO:

  • To ensure every employee has only one EPF account.
  • Compliance must be facilitated easily.
  • Make sure organisations follow all the rules and regulations set up by the EPFO on a regular basis.
  • To ensure that online services are reliable and to make improvements in their facilities.
  • For all member accounts to be accessed online easily.
  • Claim settlements to be reduced from 20 days to 3 days.
  • Promotion and encouragement of voluntary compliance.

Functions of EPFO

The main functions of the EPFO are mentioned below:

  • Helping the Central Board of Trustees in operation of the Insurance Scheme, Pension Scheme, and Provident Fund Scheme for all the registered establishments in the country.
  • To ensure the Act is enforced in every state in India except for Jammu and Kashmir.
  • Individual accounts must be maintained by the EPFO.
  • Settlement of claims is handled by the EPFO.

Services offered by the EPFO

Some of the services offered by the EPFO are mentioned below:

1. Universal Account Number

A Universal Account Number (UAN) is given to every employee who is contributing towards EPF. Various Member IDs that have been allotted to employees from various organisations come under the UAN. Each employee will be allotted only one UAN throughout his/her employment life. The EPFO allots the distinctive 12-digit UAN to employees. A monthly SMS regarding the contribution of the EPF amount, transferring of EPF amount from the previous Member ID to the current one, checking and downloading EPF Passbook, withdrawal of EPF online, and updating KYC details online are some of the services that are provided by the UAN.

However, employees must activate their UAN in order to avail the services online. Once the UAN is activated, employees can use their UAN and password to login on the EPFO portal and avail these services.

2. Helpdesk for Inoperative Accounts

In February 2015, the EPFO set up the Inoperative Accounts Online Helpdesk to help employees track dormant and old inoperative accounts that do not accumulate any interest. Employees can track these accounts, and either withdraw the funds or transfer them to the current Member ID. Basic details must be provided by the employees about their previous employment to track inoperative accounts.

3. Online withdrawal of EPF

The EPF withdrawal amount can be easily done online with the help of the UAN. Employees who have been unemployed for more than 2 months are eligible to withdraw their EPF amount. However, the Aadhaar and bank details of the employee must be linked with the UAN.

4. International workers can generate a Certificate of Coverage

EPF members that are working in countries who have Social Security Agreements with India can generate a Certificate of Coverage (CoC) with the help of an online centralised software that the EPFO has launched.

5. Monthly returns for exempted establishments

With the help of the IT tool that the EPFO has launched, exempted establishments can file their monthly returns online without any trouble.

6. UMANG App

The EPFO has launched the Unified Mobile Application for New-age Governance (UMANG) for EPF members. Employees can use their UAN and password to avail the services of the UMANG app. Various services such as viewing of EPF passbook, updating profile details, etc. are available on the UMANG app.

7. Online transfer of EPF

EPF Transfer amount from the employee’s previous Member ID to the current one can be done online with the help of the UAN. The process is hassle-free, paperless, and simple.

8. Establishments can register online

The Online Registration of Establishments (OLRE) can be completed on the EPFO portal. Employees are also benefitting due to the online presence of the PF code allotment letter.

9. Online payments of PF

It is compulsory for all organisations to make the PF payments online. Currently, Kotak Mahindra Bank, Axis Bank, ICICI Bank, HDFC Bank, Bank of Baroda, Union Bank of India, Allahabad Bank, Indian Bank, Punjab National Bank (PNB), and State Bank of India (SBI) are the 10 banks that have agreements with the EPFO for the collection of dues.

10. Missed call and SMS service

Members who have activated their UAN can access their PF balance, previous contribution, the status of KYC, etc., by sending an SMS (Format: EPFOHO UAN) to 7738299899 or by giving a missed call to 011-22901406. Employers will also receive an SMS for non-payment of EPF.

11. Claim status and passbook

The EPFO members will be able to check the status of their claims as well as view and download their EPF passbook with the help of the UAN.

12. Grievances

In case of any issues regarding the settlement of pension, transfer of PF, withdrawal of PF, etc., members can raise a complaint online. Grievance redressals are a top priority for the EPFO, and they are dealt with swiftly. 80% of the complaints are solved within 7 days and 97% of them are solved within 15 days. Due to constant monitoring of the EPF grievances, complaints have come down from 20,000 to 2,000-3,000 in a day.

EPFO Stock Market Investment

EPFO makes investments of the pension fund in the share market. The share market provides the best returns in the long run. 15% of the corpus of the pension fund is invested in the stock while the remaining is still invested in debt securities.

1. Only 5% Corpus in the Stock Market

The EPFO is treading in the stock market very cautiously. It took 10 years to take a decision in this regard. The government has given permission to invest 15% of the corpus in the stock market, but EPFO board is going with only 5%. The remaining 95% corpus still invested in debt securities.

2. The Equity Investment can Increase up to 15%

At present, the EPFO is committing only 5% of its incremental corpus to the stock market. But further it can increase the stock market investment up to 15%. The increase in equity investment would depend upon the experience of EPFO. The EPFO is going into the stock market step by step.

3. Only New Contribution Goes into the Stock Market

EPFO has 8.5 lakh crore in its kitty. But this whole corpus is not the part of EPF investment in the stock market. Rather, EPFO is not touching the existing corpus. The EPFO investment in the stock market is only from the incremental corpus. It means the money accumulated in the current financial year would be considered for stock investment. In a financial year, EPFO gets about 1-1.2 lakh crore. The 5% of this amount would be about 5000-6000 crore. Only this amount would be invested in the share market. The existing 8.5 lakh crore will remain in debt securities.

4. Equity Investment through the ETF

The EPFO is not picking valuable stocks itself for the retirement fund corpus. Rather, it is relying on the broader market. The investment of EPFO in the stock market would be through the Sensex and Nifty ETF.

Exchange traded funds (ETF) are a type of mutual fund which invests in index stocks. It follows the weightage of stocks in an index. Consequently, the exchange traded fund follows the movement of its benchmark index. The result of an ETF is similar to the indices e.g. Sensex, Nifty, Midcap index.

The EPFO also invest in CPSE (central public sector enterprise) ETFs as and when new fund offers (NFOs) comes in the market. However, the government has clarified that it will not invest in the gold ETF.

5. Prominence to Nifty

The EPFO is relying more on the broader index Nifty. The 75% of earmarked fund goes to the SBI Nifty ETF, while only 25% is allocated for the SBI Sensex ETF. Nifty is 50 stock index, whereas Sensex is a 30 stock index. However, the investment ratio may alter in future.

6. The Return from the EPF Should Increase

The investment in equity markets has the potential to give the best return in the long term. The Nifty has given 15.6% annualized return since its inception in 1996. If EPFO gets similar return from the Sensex and Nifty ETF, the overall return of EPFO corpus would be higher.

Due to the better return, the EPFO would be able to give better rate on EPF. Currently it is 8.75%. However, you can’t expect a considerable increase as an investment in the equity market is a mere 5%. If we take average return 15%, the EPFO would be able to give a return of 9.06% instead of 8.75%. However, in the short term, it all depends upon market movement.

7. The Government has Given Permission

The finance ministry has given its permission to invest in the stock market earlier in the year. In the April 2015 the government has released the notification. In this notification government has given an investment pattern for investment of EPFO corpus.

    • 45-50%- Government securities
    • 35-45% Debt securities and term deposits of banks
    • 5-15% equity market.
    • Up to 5% Money market
    • Up to 5% Asset backed securities

The labour unions and labour ministry were reluctant for equity investment. But finance ministry was insisting. The greater return of National Pension Scheme also made the background for equity investment by the EPF. The retirement scheme NPS invests some percentage in the share market.

8. SBI Mutual Fund Manages the Fund

The EPFO has selected the SBI mutual fund as the fund manager to invest in the stock market. EPFO is investing in the ETFs of SBI mutual fund. These ETFs are the SBI Nifty ETF and SBI Sensex ETF. The EPFO chose SBI to manage its corpus because it is charging mere 5 paise for investment of Rs 100. It means EPFO is spending Rs 2.5 Crore as the charges of fund management.

9. It Gives Stability to Stock Market

The investment of EPFO in the stock market helps the equity market. It gives greater stability to the share market. It adds liquidity to the share market. It also reduces dependency on FIIs.

Similar to LIC, the EPF corpus would also counterbalance the selling of the FII. The FIIs act according to the global markets. But domestic investor, takes decision on domestic market condition. Therefore, the domestic investors turn net buyers at the time of FII selling. This behavior helps to stabilize the share market.

Along with LIC, and domestic mutual fund companies, the EPFO can counterbalance the FII investment.

10. The EPFO Equity Investment Is Smaller Than LIC

Considering the size of EPFO corpus the investment in share market is minuscule. The 5000 crore of EPFO would be far less than 60000-7000 crore of LIC. LIC, also the government entity invests a considerable amount in the stock market. It is a major shareholder of many blue-chip companies.

The interest rates are on the slide. In this circumstance, the equity investment can only give you higher returns.

FAQs

  1. Is the Provident Fund Scheme, Pension Scheme and an Insurance Scheme introduced by Employee Provident Fund Organization (EPFO) mandatory?
  2. Yes, the Provident Fund Scheme, Pension Scheme and an Insurance Scheme introduced by Employee Provident Fund Organization (EPFO) is mandatory, especially for employees who fall under the wage ceiling set by the organization.

  3. Does this cover international workers as well?
  4. Yes. The schemes cover Indian workers as well as International workers in countries where a bilateral agreement has been signed with the Indian Government. There are 14 Social Security Agreements made with India by countries such as Germany, Belgium, Switzerland, France, Grand Duchy of Luxembourg, Denmark, Netherlands, Republic of Korea, Finland, Hungary, Sweden, Norway, Czech Republic, Canada and Austria. International workers can also use the EPFO portal for online application of COC (Certificate of Coverage).

  5. What is the minimum number of employees required in an establishment for it to come under the purview of this Act?
  6. The minimum number of employees required in an establishment for it to come under the purview of this Act, is not less than 19 employees.

  7. What are the e-governance initiatives undertaken by EPFO?
  8. The e-governance initiatives undertaken by EPFO are Online Transfer Claim Portal (OTCP), Online Registration of Establishment (OLRE), and Online Monthly Return for Exemption Establishment, etc.

  9. What is “Superannuation” pension?
  10. An employee is entitled to superannuation pension if he/she has provided a service for a period of 10 years or above and has retired at the age of 58 years.

  11. When is an employee entitled to an early pension as per the Employees’ Pension Scheme?
  12. As per the Employees’ Pension Scheme, an employee entitled to an early pension when he/she has provided a service for a period of 10 years or above and then ceases to be in employment or retires before attaining the age of 58 years.

  13. What is the procedure of withdrawing PF account money and Pension Fund money through the UAN portal once the employee has left a job and joined a new organization?
  14. When the employee leaves a job and joins a new organization, he/she should get the funds transferred to the new account under the present employer. The UAN facility permits portability of funds from one account to another since it links an employee’s Member IDs. This will be done only after the KYC information has been verified by both the establishments.

  15. What is the UAN Helpdesk Contact Details?
  16. You can contact the UAN Helpdesk regarding any queries related to the UAN member portal at the following number: 1800 118 00 or through email at uanepf@epfindia.gov.in.

  17. How much of an employee’s wage is considered for making a PF contribution?
  18. The remuneration paid to an employee is cash is considered while calculating the monthly PF contribution. This will exclude wage categories such as Overtime allowance, House Rent Allowance (HRA), Commission or any such incentives, bonus, presents given to the employee by the employer, etc.

  19. Is there a tax benefit on the schemes offered by Employee Provident Fund Organization (EPFO)?
  20. Tax is not applicable on the EPF earned by an employee. The contribution made by the employer is not taxed and a contribution of the employee for an amount of up to Rs. 1 Lakh is deducted from taxable income under Section 80(C) of the Income Tax Act. The interest (as per the rate set by the EPFO) accrued on the same is also not taxable. This is applicable only in terms of the Government’s EPF scheme.

  21. What is the mode through which Employers should pay the PF due?
  22. Employers must pay the PF due through Electronic Challan cum Return (ECR).

  23. How are Electronic Challan cum Return (ECR) documents generated?
  24. The E-return tool is used by EPFO to generate the Electronic Challan cum Return (ECR) documents.

  25. What is the E-Return Tool? How to use the E-Return Tool?
  26. The Employees Provident Fund Organization (EPFO) offers the E-Return Tool to employers for ease of payment of PF on behalf of their employees. This tool can be downloaded and all monthly payments can be paid electronically using. In the main menu you can select "Generate returns for submission to EPFO" to generate the Electronic Challan cum Return (ECR) and upload it online in the employer’s e-Sewa.

  27. What is a digital signature certificate (DSC)? How is it relevant in procedures undertaken by EPFO?
  28. Digital signature certificate (DSC) is an electronic form of hardcopies of certificates such as passport, driving license, etc. These act as identity proof for individuals who are applying for certain services online or for signing documents digitally. With the enactment of the Information Technology Act, 2000, Digital Signature Certificates have become legally valid in India. EPFO stipulates that its users must use Digital Signature Certificates in order to attest their online claims and also to verify their identity and other details submitted online. When this is digitally attested and submitted there is no need to submit any physical documentation to the EPFO office.

  29. Why should an employer register his/her establishment on the EPFO employer portal?
  30. An employer has to register his/her establishment on the EPFO employer portal because all PF contributions and other related activities can only be performed online through this portal. The Electronic Challan cum Return has to be uploaded in this portal in the prescribed proforma and the receipt will be populated accordingly. Many other services can also be availed through the EPFO employer portal by registering for the same.

  31. How to purchase a Digital Signature Certificate?
  32. In order to purchase a Digital Signature Certificate that is legally valid, you can approach the Govt. of India, Certifying Authorities (CA) (such as NIC, e-Mudhra, TCS, n-code, MTNL, etc.) and Controller of Certifying Authorities (CCA) that issue these certificates.

  33. Who is the Certifying Authority?
  34. Certifying Authority is a recognized agency that issues, renews and revokes Digital Signature Certificate. The Information Technology Act 2000 authorizes Certifying Authorities to issue Digital Signature Certificate. Some of the Certifying Authorities (CA) in India are NIC, e-Mudhra, TCS, n-code, MTNL, etc.

News About EPFO

  • Higher pension to be provided to 6.3 lakh EPFO members from May

    The 6.3 lakh Employees’ Provident Fund Organisation (EPF0) members who had opted for commutation, pensions will be given in full in the month of May. The notification for the restoration was given by the government in February.

    Commutation is an option that is provided to EPFO members to change their monthly payments into a lump sum at the time of retirement. According to the Employees’ Pension Scheme (EPS) rules, individuals who have retired before 26 September 2008, two-thirds of their pension will be paid as monthly pension and the remaining will be paid as a lump sum. However, as per the meeting of the EPFO’s Central Board of Trustees, the proposal to restore the complete monthly pension for those who retired before 26 September 2008 and applied for commutation has been approved. According to reports, the move will cost the government Rs.1,500 crore. This is expected to be an additional burden at a time where the economy is declining because of the coronavirus outbreak and the subsequent lockdown. The restoration will increase the pension for EPFO members who retired before 26 September 2008 and opted for partial pension commutation. Post the restoration, individuals who retired on 1 April 2005 will receive the increased pension in the month of May. Currently, pension commutation is not available for EPFO members.

    30 April 2020

  • 10.2 lakh withdrawal claims settled by the EPFO in the last 15 days

    10.20 lakh withdrawal claims have been settled by the Employees’ Provident Fund Organisation (EFPO) in the last 15 days. Out of the 10.2 lakh, 6.06 lakh have been COVID-19 advance claims.

    A total of Rs.3,600.85 crore have been disbursed over the 15 working days. According to a statement made by the Labour Ministry, around 90% of the COVID-19 advance claims were settled in 3 days. As per the COVID-19 advance claim guidelines, an EPF member can withdraw 75% of the balance available in the account or 3 months’ basic wages and Dearness Allowance (DA), whichever is lower. The Pradhan Mantri Garib Kalyan Yojana (PMGKY) scheme was launched by the government on 26 March 2020 to help individuals who are in the weaker sections to overcome the coronavirus outbreak. The statement further added that even though only one-third of the staff are working, 90% of the claims have been settled, setting new service delivery standards. Individuals can avail the advance claim on the official website of EPFO or by using the UMANG app. The top establishments that have exempted from the amount disbursed for coronavirus claims are Visakhapatnam Steel Plant, TCS, and NLC Ltd.

    27 April 2020

  • 1.27 lakh claims processed by the EPFO under the special pandemic withdrawal scheme

    On 8 April 2020, the Employees’ Provident Fund Organisation (EPFO) officials said that around 1.27 lakh claims have been processed under the special withdrawal scheme. A total of Rs.238.48 crore has been disbursed under the scheme that was launched due to the coronavirus outbreak.

    On 26 March 2020, the Finance Minister Nirmala Sitharaman had announced the special withdrawal scheme to help EPFO members during the 21-day lockdown. Under the new scheme, EPF members are allowed to withdraw up to 75% of their PF balance or three months basic pay, whichever is lower. After the notification was sent on 27 March, the scheme was rolled out on 29 March. A new software was developed by the EPFO to process the applications quickly. According to the CEO of the EPFO, the process to remit the money has begun. He further added that applications that are completely KYC compliant have “no pendency”. He said applications that are KYC compliant were processed within 72 hours and the other applications were completed on high priority. On 5 April 2020, the Union and Labour Ministry had announced that the Aadhaar card can be submitted for changing the date of birth.

    10 April 2020

  • Date of birth on Aadhaar can be used as proof of rectification by the EPFO

    However, the difference must be less than three years. According to a statement made by the Union Labour and Employment Ministry, the move was made in order to improve online services and extend the availability because of the coronavirus outbreak. The statement further added that revised instructions have been introduced by the EPFO to the relevant offices to allow PF members to change the date of birth in the EPFO records to ensure that their Universal Account Number (UAN) is KYC compliant. The Ministry said that individuals who wish to change their date of birth can complete the process online. The Ministry further added that allowing individuals to change the date of birth by using the Aadhaar Card will reduce the processing time. After the Finance Minister announced that EPF members can withdraw their non-refundable advance, the Ministry amended the scheme on 27 March 2020.

    07 April 2020

  • Around 16% of the EPFO subscribers are likely to be covered under the PM Garib Kalyan scheme

    According to a report, the PM Garib Kalyan scheme may provide cover to around 16% of the 48 million EPFO subscribers.

    According to an announcement made by the Financial Minister, EPF contribution of both employer and employee will be made by the Centre. This was part of the Rs.1.7 lakh crore that was provided under the scheme. However, companies with less than 100 employees, where less than Rs.15,000 is earned by less than 90% of the employees, will be provided this benefit. According to a senior official who provided this report, the EPF contribution will be provided by the Centre in the form of reimbursements. The contributions must be made by the employer over the next three months and proof of the same must be provided. The report further added that only one-third of the 563,000 establishments that come under the EPFO scheme will be covered. The Finance Minister also announced that an individual can also withdraw 75% of their non-refundable advance or 3 months’ salary, whichever is lower.

    30 March 2020

  • EPFO rules relaxed for withdrawal under Covid-19 stimulus package

    The Government of India has relaxed rules for the Employees’ Provident Fund Organisation (EPFO) due to the coronavirus pandemic. EPFO members can now withdraw up to 75% of the credit that is outstanding in their EPF account, or three months of their salary, whichever is the lower amount. This withdrawal will be non-refundable. This will help employees to tide over their liquidity issues by providing more cash in hand during the economic crisis brought about by the pandemic.

    26 March 2020

  • EPF interest rates slashed to 8.50% by the EPFO for FY20

    On 5 March 2020, the Employees’ Provident Fund Organisation (EPFO) reduced the Employee’s Provident Fund (EPF) interest rate from 8.65% to 8.50% for FY20. The announcement was made by the Labour Minister Santosh Gangwar.

    The Labour Minister told reporters that the EPFO is providing an interest rate of 8.50% for any deposits made towards the EPF account for 2019-2020. The decision was taken after the central board of trustees meeting consisting of representatives of governments, employers, and employees. The move to reduce the interest rate will affect around 6 crore subscribers. Now, the Labour Ministry will require the concurrence of the Finance Ministry in this matter. The Finance Ministry has not yet vetted the proposal to reduce the interest rates. The Finance Ministry has been requesting the Labour Ministry to reduce the interest rates of the EPF scheme to align other small savings schemes such as the post office savings scheme and the Public Provident Fund. The EPFO had provided interest rates of 8.8%, 8.65%, and 8.55% for 2015-2016, 2016-2017, and 2017-2018, respectively.

    05 March 2020

  • EPFO may cut rates on PF deposits to 8.5%

    Employee’s Provident Fund Organisation (EPFO) is mulling to cut rates on provident fund deposits to 8.5%.

    PF deposits had fetched 8.65% in FY19. However, the issue regarding the cutting of PF deposit rates is likely to be discussed during the central board of trustees (CBT) meeting on March 5.

    The earnings on long-term deposits, government securities, bonds, etc., are down 50-80 basis points which may make it difficult for the retirement board to not keep the rates unchanged.

    Depending on the exact earnings of the retirement fund body, The Finance Investment and Audit Committee (FIAC) will take a call regarding the changes in the rates just before the CBT meeting.

    28 Feb 2020

  • New SPICe+ form rolled out for easy incorporation of businesses

    The government has introduced the Simplified Proforma for Incorporating Company Electronically Plus (SPICe+) to enable easy registration of businesses in India. It provides for Provident Fund Organisation (EPFO) and Employees' State Insurance Corporation (ESIC) and Employees' Provident Fund Organisation (EPFO) registrations.

    This form brings together 10 services from different departments like department of revenue, corporate affairs and labour, and also the Maharashtra government. This form comprises of two parts; one is for reservation of a company name, and the other part includes services like TAN and PAN issue, professional tax registration in Maharashtra and DIN allotment.

    This move was taken to help the government achieve its goal of making it to the 50th spot on the World Bank’s Ease of Doing Business (EODB). Currently the Indian government ranks at the 63rd spot out of 190 countries.

    28 Feb 2020

  • In order to monitor compliance, e-inspection to be started by the EPFO

    An e-inspection system will soon be launched by the Employees’ Provident Fund Organisation (EPFO) across India so that the voluntary compliance of the EPF scheme can be monitored.

    According to Sunil Barthwal, the Central Provident Fund Commissioner, the EPFO firmly believes in voluntary compliance and wished to understand the issues in the industry in case of non-compliance and default of the scheme. Barthwal said that the e-inspection system will be started by the EPFO to monitor the voluntary compliance of the employers. The announcement was made at a CII event. The Central Provident Fund Commissioner further added that the EPFO is working on a process so that individuals get their provident fund on the day they retire. A process is also being worked on where individuals receive their pension benefits in a timely manner. However, in order to receive the maximum benefits of the scheme, the Universal Account Number (UAN) must be linked with the Aadhaar.

    27 Feb 2020

  • EPFO’s decision to reinstate pension commutation implemented by the government

    The Employees’ Provident Fund Organisation’s (EPFO’s) decision to restore the pension commutation that falls under the Employees’ Pension Scheme has been implemented by the labour ministry. The move will benefit around 6.3 lakh pensioners.

    Under pension commutation, part-withdrawal of the pension amount is allowed. The subscriber will receive a reduced pension for 15 years. Post the decision made by the labour ministry, pensioners will receive the entire amount after 15 years. The decision to restore pension was made on 20 February 2020 for subscribers who have opted for pension on or before 25 September 2008. The Employees’ Pension Scheme has been amended. According to the notification, the normal pension will be restored to individuals who opted for the benefit on or before 25 September 2008. As many as 6.3 lakh pensioners who had chosen for commutation of pension and received a lump sum at the time of retirement will be benefited. Earlier, the facility for commutation of pension had been withdrawn by the EPFO. However, this facility has now been restored. The proposal to restore commutation has been approved by the Central Board of Trustees that is headed by the labour ministry.

    27 Feb 2020

  • CMO official retires from EPFO

    The resignation letter submitted by additional central provident fund commissioner P. Rajasekhar Reddy, special secretary has been accepted by The Employees Provident Fund Organisation (EPFO) in the Chief Minister’s Office.

    Mr. Reddy had been in the CMO since 2014 and applied for a voluntary retirement. He had been relieved of his duties on January 31.

    The reasons behind the resignation of Mr. Reddy was unknown. However, it is speculated that he opted for the retirement as he was working in the CMO on deputation for more than five years now and could get extension for limited period in the event he requested for it. Mr. Reddy will however continue to serve the Chief Minister as Special Secretary in the CMO.

    19 Feb 2020

  • Labour Minister says that grievances related to ESIC and EPFO could be resolved soon

    On Monday, the Labour and Employment Ministry said that policies as well as procedures will be streamlined so that grievances related to ESIC, EPFO and other such entities will be redressed in a speedy manner. Last year, there were over 9 lakh complaints on the EPFi Grievance Management System and almost 8.4 lakh of them were disposed of. Santosh Kumar Gangwar, the Labour and Employment Minister told Lok Sabha that policies as well as procedures are being reviewed and streamlined by the ministry so that grievances can be resolved quickly and efficiently. Some of the entities of which the grievances need redressal include the EPFO (Employees’ Provident Fund Organisation), the Chief Labour Commissioner (Central), and the Employee State Insurance Corporation (ESIC). Moreover, a number of IT initiatives as well as systemic reforms are being implemented for the achievement of quick grievance redressal, according to the minister. When it comes to CPGRAMS (Centralised Public Grievances Redress and Monitoring System), there were a total of 47,567 complaints and the number of those disposed stood at 46,283.

    14 Feb 2020

  • EPFO social security assistant exam Phase 2 results announced

    The Phase 2 examination result for the recruitment of social security assistants has been declared by the Employees’ Provident Fund Organisation (EPFO). Individuals who have appeared for the examination can check their results on epfindia.gov.in.

    The Phase-2 recruitment examination was conducted by the EPFO on 14 November 2019. The result has been declared region wise and is available in the pdf format. Individuals who wish to check their results can access the pdf for that region. The name, registration number, and roll number can be checked. Once you visit the official website of the EPFO, you must click on ‘Recruitment’, which can be found under the ‘Miscellaneous’ tab. Next, click on the pdf file that states, ‘List of candidates shortlisted for the Phase-III Examination’. You must click on the pdf file for the region where you have appeared for the examination. On the next page, details of the result along with the registration number, roll number, and name of the candidates will be displayed. You can download the results and take a print-out of it.

    12 Feb 2020

  • Aadhaar, Account Number, and PAN Card needs to be linked to avail online services of EPF

    Subscribers of the Employees’ Provident Fund Organisation (EPFO) need not visit the EPFO office or fill the offline form to avail services such as PF Claim, PF Transfer, or Partial Withdrawal when they switch jobs. Instead, they can avail these services online provided their Universal Account Number (UAN) is activated and their Know-Your-Customer (KYC) documents are linked to the UAN. The KYC documents that need to be linked to avail these services are Aadhaar, Permanent Account Number (PAN), and Account Number. To link these documents, you will need to visit the unified member portal and login using your UAN and password. Once you login, you need to select the ‘Manage’ section followed by the KYC option. Then select the PAN, bank, and Aadhaar option. In the following document, you will need to fill up your name, document number, and other requested information. The information provided will be approved by your previous employer or your current employer. The Income Tax department will then verify your Aadhaar while the PAN will be verified by UIDAI.

    22 January 2020

  • EPF interest rate may be cut soon

    Interest rates on the mandatory Employees Provident Fund (EPF) may be lowered by the Employees’ Provident Fund Organisation (EPFO) this fiscal by nearly 15 to 20 basis points (bps). An interest rate of 8.65% was offered by the EPFO to subscribers during the 2018-19 fiscal year. Factors that have influenced this include debt market instruments and government securities giving lower yields, economic downturn, and the Public Provident Fund (PPF) also yielding lower interest rates. The EPF’s annual interest rate will be revealed by the end of January. Of its annual accruals, the EPFO invests 85% of it in the debt market with 15% of it being invested in Exchange-Traded Funds (ETFs) as equities. Also, approximately Rs.1,300 crore of worker’s contributions to the EPFO had been invested in Dewan Housing Finance Corp Ltd. and Infrastructure Leasing and Financial Services Ltd., which are both ridden with debts. However, the Central Board of Trustees (CBT) will stress on maintaining an interest payout of 8.65% as much as possible this year. The CBT is the decision-making body of the EPFO with over 60 million active subscribers and a corpus of Rs.12 trillion which it manages.

    21 January 2020

  • Private sector employees to get pension based on total salary

    The Employees’ Provident Fund Organisation had filed a Special Leave Petition against the Kerala High Court order stating that the EPFO was to provide pension to retiring employees based on their total salary without a cap of Rs.15,000 per month. However, the Supreme Court has dismissed the plea of the EPFO that was filed against the ruling of the High Court. This will result in all retiring employees receiving a pension that is based on their total salary without any cap on it. However, corpus of Provident Fund contribution will reduce as the bulk will go to the Employees’ Pension Scheme (EPS) and not to the PF. The EPS applies to all employees under the EPS scheme who will receive pension permanently. The scheme, which was launched in 1995, requires that every employee who has a monthly salary and DA combined of Rs.15,000 must be enrolled in the scheme.

    3 April 2019

  • AGILE form allows you to get EPFO, ESIC, and GST numbers from 1 April

    Employees Provident Fund Organisation (EPFO) registration, Employees’ State Insurance Corporation (ESIC) registration, and Good and Services Tax Identification Number (GSTIN) registration can be done via an e-form known as AGILE, according to a notification from the Ministry of Corporate Affairs (MCA).

    ESIC, EPFO, and GSTIN are the three vital registrations for businesses and is covered under the AGILE form which is a part of the e-form, SPICE Incorporation. Companies would be automatically enrolled for the EPFO, ESIC, and GST by filing for the SPICE Incorporation form and the AGILE e-form. As per the notification, with effect from 31 March 2019, the SPICE form will be accompanied by the AGILE e-form and has been informed vide the Companies (Incorporation) Third Amendment Rules, 2019. The AGILE e-form is also known as the INC-35 form and registering companies can use this form to apply for the EPF, ESI, and GST registration. However, the AGILE e-form must be filed along with the SPICE form. The dates for registration of the GSTIN, EPFO, and ESIC by using the AGILE e-form are 31 March 2019, 8 April 2019, and 15 April 2019, respectively.

    2 April 2019

  • New mechanism to be released by EPFO for better formal employment data

    The Government of India is planning to introduce a mechanism that will allow it to track people changing jobs. This will be useful to get a clearer picture of formal employment in the country generated in the country. According to the latest Employees' Provident Fund Organisation (EPFO) data, the employment generation in the formal sector was 8.96 lakh in the month of January.

    In January, 3.87 lakh members subscribed to EPFO. The EPFO data, currently, only includes the number of new joiners, exits, and rejoiners. However, the mechanism of counting the numbers of members who are returning, and rejoining is not very strong at the moment. The new mechanism in plans will increase efficiency and make the data more accurate. It will also help EPFO in generating net employment figures.

    EPFO released the payroll data from September 2017 to April 2018. However, due to the present drawbacks, the data cannot accurately represent the number of new jobs generated in the country. Subscribing to EPFO is mandatory for any organisation employing more than 20 people but it leaves out people employed in micro, small and medium enterprises.

    26 March 2019

  • Soon calculation statement will be available on EPF withdrawal

    The Employees’ Provident Fund Organisation (EPFO) has advised its regional offices to provide a calculation sheet to the Employees Provident Fund (EPF) employees at the time of their final withdrawal. The calculation statement will be sent to the employee’s email ID or mobile number by the regional offices.

    As per a notification dated on 22 March 2019, the main reason for the decision was to increase the transparency and reduce on the grievances and confusions that employees face. The calculation sheet will be provided for employees who have filed for claims both online and offline. The EPFO is also making the process for transfer of PF hassle-free in case employees change their jobs and without much interference from employers. According to sources, the EPFO also plans to introduce the ‘Anywhere Service’, which will help subscribers merge their PF accounts easily in case of a change in location. In February 2019, the interest rate was increased to 8.65% by the EPFO. Currently, there are close to six crore subscribers who have registered for EPFO. The employer and employee each contribute 12% of the employee’s basic salary towards EPF.

    26 March 2019

  • LIC May Get Replaced as Fund Manager of PM’s Pension Plan

    The Indian Government is trying to ease the eligibility norms pertaining to its pension scheme, in order to make it more inclusive for the workers of the unorgansied sector. Further, it is also considering replacing the fund manager with Employees’ Provident Fund Organisation or EPFO. The fund manager for the Government’s pension scheme was Life Insurance Corporation of India or LIC earlier. In order to establish a better synergy, the Government is considering replacing LIC with EPFO.

    The Pradhan Mantri Shram Yogi Maan Dhan is a contributory scheme implemented by the Indian Government. Under this scheme, each worker from the unorgansied sector (cobblers, construction workers, and so on) will receive an amount of Rs.3,000 on a monthly basis. This scheme, however, excludes those employees that are covered under the Employees’ State Insurance Corporation (ESIC) and EPFO. This particular criterion can often be considered restrictive as it has been based on a false assumption that workers from the unorganised sector cannot migrate to the organised sector, and vice versa. This particular criterion is being relaxed by the Indian Government as it wants individuals migrating to the organised sector to enjoy the benefits of PM-SYM equally.

    The scheme has been implemented successfully by the Modi Government in order to financially secure the futures of people working in the unorganised sector. Since these individuals are less privileged in terms of purchasing comprehensive life insurance or health insurance policies, the Indian Government will provide an amount of Rs.3,000 every month.

    25 March 2019

  • Pension calculation worksheet to be provided to EPFO pensioners

    Pension calculation worksheets will be provided to the Employees’ Provident Fund Organisation (EPFO) pensioners soon. Along with the pension sanction order, it will have a concise monthly pension calculation statement. This will help in the rectification of any errors sooner and quicker. It will also make it more transparent. The Employees’ Pension Scheme (EPS) does not give a clear link between the employer’s contributions and the EPS benefits. Employees, under the EPS scheme, are eligible to get a pension monthly according to certain calculations per the law. To be eligible for EPS, 10 years of service is required. For lesser service periods, beneficiaries can still get a sum withdrawn. It is still not clear, however, whether employees with service periods shorter than 10 years will receive the pension calculation worksheet. It is also not clear yet what the mode of sharing the worksheet will be – whether I will be an email format or a hard copy. However, it is clear that this will reduce employee grievances to a great extent as they will be able to catch any errors in the calculations and get them resolved much faster than before.

    19 March 2019

  • EPFO to Provide Pensioners with Pension Calculation Statement

    The Employees’ Provident Fund Organisation (EPFO) has announced that it will soon be providing pensioners with a statement of how their pension is calculated as well as the order in which their pension is sanctioned. This move has been made by the retirement body in an effort to lend greater transparency to the process and reduce the number of grievances raised.

    The practice has been initiated since the benefit to be provided to pensioners as part of the Employees’ Pension Scheme (EPS) does not match the contributions that have been made by the employer during the course of the subscriber’s employment.

    All regional EPFO offices have been issued a circular stating that all pensioners are required to receive a worksheet with information about the quantum of the pension.

    18 March 2019

  • EPFO will take action against firms that don’t factor special allowances for computation of EPF

    The Supreme court has ruled that basic wages should include special allowances too which should be taken into account for computation of the Employees’ Provident Fund (EPF) contribution. The Employees’ Provident Fund Organisation (EPFO), which is the retirement body that manages the EPF, will take action against any firm that does not take this component into account when computing the EPF contribution. The employee and employer contribution towards the EPFO-run social security scheme is 12% each. In a study conducted by the EPFO, it was found that employee pay packages were being split into numerous allowances by employers to reduce EPF liability although employees believe this results in a higher take-home pay.

    5 March 2019

  • EPFO organises a committee in order to make EPS more appealing

    As the Indian Government contemplates on whether to raise the pension to members, the Employees’ Provident Fund Organisation (EPFO) is looking at various options to make the Employees’ Pension Scheme (EPS) more appealing.

    A committee has been set up by the EPFO in order to make EPS more attractive for members to continue investing in case they change jobs. As per sources, apart from raising the pension, the EPFO is looking into providing incentives for its members. Individuals who change jobs after two-three years tend to withdraw their Provident Fund (PF) balance, according to officials. An ‘auto trigger’ option will soon be introduced by EPFO, where employees can transfer their PF balance to their new company without opening a new account. This will be possible by using the Universal Account Number (UAN). The employer and employee each contribute 12% of the employee’s basic salary towards Employees Provident Fund (EPF). Out of the 12% of the employer’s contribution, 8.33% is towards EPS. Individuals are entitled to a pension if they remain members for 10 years or more.

    27 February 2019

  • Piyush Goyal stated that the EPFO received 2 crore membership in past 2 years

    Interim Finance Minister Piyush Goyal stated that the membership of the Employees Provident Fund (EPFO) has increased by more than 2 crore in the past 2 years. This statement came from the finance minister one day after a leaked media report. Referring to the ‘Periodic Labour Force Survey’ (PLFS) published by the National Sample Survey Office (NSSO) this report stated that the unemployment rate in India was 6.1% in the period of 2017-18 which is the highest in the past 45 years. However, this report which was prepared in the month of December 2018 is not officially published yet.

    26 February 2019

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