The limit of the Employees Provident Fund Scheme was changed from Rs.6,500 to Rs.15,000. This is a much higher percentage in comparison to when it was Rs.6,500. A minimum pension of Rs.1,000 was also approved.
At this particular meeting a major decision was taken pertaining to the EPFO. This major decision that was taken at the meeting was the increment of the the EPF limit from Rs. 6500 to Rs 15000 which is drastically higher in percentage. Also the minimum pension of Rs, 1000 was also given approval.
The following lines are excerpted relaying the decisions made at the meeting:
“Item No. 3: Amendments to the Employees’ Provident Fund Scheme, 1952 (EPF), Employees’ Pension Scheme, 1995 (EPS) Employees’ Deposit Linked Insurance Scheme, 1976 (EDLI ) for implementing increase in wage ceiling to Rs. 15,000/- and Minimum Pension of Rs. 1,000/- - issues and modalities.”
CPFC also explained the contents of the above mentioned item in detail. They also requested the Board for the approval of the proposal as based in the agenda. The representatives of the employers also made a suggestion for increasing it to Rs. 15,000 from Rs. 6,500 being too steep and requested that it would be restricted to Rs10,000 in the first phase and Rs. 15,000 in the second phase. The representatives also made a suggestion or Micro, Small and Medium Establishments a.k.a MSMEs to be adversely affected by such a drastic decision. They did support the proposal for hiking the minimum pension to Rs. 1000. It was also discussed that with these increases in EPF limits the resultant rise in workload would require more labour resource as well as infrastructure for the EPFO to be able to handle the new reforms.
However the representatives for employees supported the proposal as well as demanded that the conditions that have been imposed for the increment of the minimum pension require to be discussed further. They further stated that the organisational resources require to be stronger for being able to handle the rise in the workload. The representatives expressed their gratitude to the Chairman for his initiatives on getting the proposal approved from the Ministry of Finance.
the other major decision by the CBT was the approval of reducing the administration charges from 1.10 % to 0.85%.
Therefore, being based on these changes, and as in October 2015, the decisions made in the meeting has impacted in the following changes in the EPF limits.
- 8.33% from the employer's share of Provident Fund contributions of the total salaries that is limited to Rs. 15,000 each month is sectioned and contributed towards the Employees' Pension Fund.
- A payment of 0.5%, of the total wages amounting to a maximum of Rs. 15,000 has to be done by the employer every month, against the Employees' Deposit Linked Insurance Scheme.
- Under the Employees' Deposit Linked Insurance Scheme a maximum of Rs. 3,60,000 per annum.
- 12% of the basic pay, Daily Allowance , food concession along with retaining allowance, if there are any, can amount to a maximum of Rs.15,000 each month is to be paid by the employer and the employee against EPF contribution.