The 203rd meeting was held on February 5, 2014 of the Central Board of Trustees’, Employees' Provident Fund (CBT, EPF). It was held under the Chairmanship of CBT, EPF and Union Minister of Labour & Employment of Shri Oscar Fernandes. 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.”
EPF or Employees’ Provident Fund Account is where your provident fund money is deposited both by you and your employer. However, when you change your job, you also need to transfer your PF account to the new organisation. The easiest way to do this is via Online Transfer Form.
At present, employees are required to file Form 13 for provident fund transfer on changing jobs. However, new joinees don’t need to submit separate EPF transfer claims by Form 13 when changing jobs any more. It will get transferred automatically with Form 11.
EPFO introduced the new composite form (Form 11) that shall replace Form 13 in auto transfer cases. The EPFO issued this order on 20 September, 2017.
Things To Know About the New PF Transfer Form(Composite Form 11):
- The Form 11 or Composite Form as it is otherwise known, is a document that an employee can file via their new employer to declare personal information like Aadhaar number, bank account details, etc.
- At the time of joining, the new but experienced employee can provide details of their EPF account held at the previous organisation by filling up this new Form 11, declaring his/her details.
- Employees from the formal sector, without Aadhaar number, have to file Form 13 to get their EPF transferred to the new account on job change. But Form 11 is still to be used instead of Form 13 in all online auto transfer cases.
EPFO receives more than 1 crore different types of PF claims each year. These include EPF withdrawal, death claims, pension fixation, and claims for PF transfer. EPFO currently has more than 4 crore subscribers, and in total manages funds worth more than Rs.10 lakh crore.
EPF Transfer claims contribute around 10-15% of these claims filed. The EPFO encourages subscribers to use online facility to seek funds transfer into their new PF accounts on job change.
How Online EPF Transfer Works
The EPFO has introduced UAN or Universal Account Number, a portable PF account number which remains the same for the entire lifetime of formal sector workers.
- After joining a new organization, an employee has to fill up and submit his/her details via the Composite Declaration Form 11, where the joinee has to fill personal details. The new joinee also has to enter his/her UAN and previous PF account number.
- The employer enters the information as given in Form 11 in the employer's portal.
- The data is then validated with the information available against the UAN and in case of any discrepancy, the employer has to verify/update the information provided.
- If the earlier UAN was seeded with Aadhaar and verified, the declaration of the employee’s transfer request by the employer in Form 11 will initiate the auto-transfer process, and the sum accumulated in the previous PF account shall be credited to the new PF account.
- The subscriber will receive an SMS giving information regarding the auto-transfer proposed on his/her registered mobile number.
- Auto transfer will be completed only after the member does not request to stop the proposed auto-transfer (either online, or through employer or at the nearest EPFO office) within 10 days of the SMS, and the first contribution by the present employer is deposited and reconciled.
- Once the account has been transferred, the employee shall be communicated the same via an SMS on his/her registered mobile number and by e-mail if seeded with UAN.
Note: Auto transfer of PF account with previous employer would be possible only in respect to employees with Aadhaar verified. If the earlier UAN was not seeded with Aadhaar or UAN was Aadhaar seeded but not verified, the member needs to apply for transfer in Form 13 as the existing procedure for physical transfer would be followed.
The Update EPF Ceiling Limit
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%.
EPF Limits: As of 2017
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.
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