Question No: 1:- Is there any possibility of a proposal to increase the Minimum Pension under EPS,’95 in Union Budget to be presented on 1st of February, 2023?
Answer:- Union Budget is prepared basing on Income received directly by Government and Expenditure incurred by the Government. EPS,’95 Contributions from Employers on behalf of the Employees are received by the Employees’ Provident Fund Organization but not directly by the Government. The remittances in the form of Contributions under EPS,’95 are controlled by the Central Board of Trustees of EPFO. Hence it is the CBT of EPFO which has to take the decision about Minimum Pension. When Government of India in the past expressed willingness to subsidise Minimum 1,000/- Pension under EPS,’95, then only it kept provison in the Budget then and continues to do the same in subsequent Budgets about the amount to be allocated to subsidise minimum 1,000/- Pension.
Question No: 2: There are Government Undertakings such as Hindusthan Cables Limited at Hyderabad and Kerala State Detergents & Chemicals Limited, Kuttippuram etc which were closed. Employees worked in these Establishments are eligible for Higher Pension?
Answer:- Employees of Government Undertakings comes under Employees from Exempted Establishments where the Employer’s Contribution is on Full Wages. Hence they are eligible for Higher Pension for the Contribution period from 16-11-1995 till the date which is before the closure of the Undertaking which should be more than 10 years. As there is no Employer for them since the Undertaking was closed, they can approach the Regional Provident Fund Commissioner for further clarification.
Question No: 3:- When Pension under Ceiling is calculated it is on pro-rata basis i.e., one calculation for the Ceiling period of 6,500/- (including Ceiling period of 5,000/-) and another calculation for the Ceiling of 15,000/- i.e., for the Ceiling period of 15,000/- from 01-09-2014 till they attain 58 years. This is called Pension on Pro-rata basis. But in the case of Higher Pension there is calculation of Pension not on Pro-rata basis. The calculation depends on the average of last 60 months Pay+D.A. before attaining the age of 58 years only.
Question No: 4:- Employees who took Voluntary Retirement under “Golden-Shake Hand Scheme” of Government from Public Sector Undetakings now receiving Pension under Ceiling eligible for Higher Pension?
Answer: They are eligible for Higher Pension provided their contributory service is more than 10 years from 16-11-1995 before taking Voluntary Retirement.
G. Srinivasa Rao, Mobile No: 89851 72459 & WhatsApp No: 86398 71817.
1) Role of Employer in case of Joint Option in case of Employees who attained 58 years before 3rd November, 2022, but continuing in service due to rise in retirement age to 60 or 62 years:
Answer: Here the Employer has already contributed on Full Wages to the Provident Fund Account till the Employee attained 58 years and out of the Employer’s Contribution only maximum 417/- (8.33% of 5,000/-), 541/- (8.33% of 6,500/-) and 1,250/- (8.33% of 15,000/-) was remitted to P.F. Commissioner. The remaining amount is still lying in the Employer’s Contribution part of the P.F. Account of the Employee. Now the difference of 8.33% between the Ceiling and Full wages are to be transferred to P.F. Commissioner from the P.F. Account of the Employee by the Exempted Trust.
- In case of Employees who are on rolls as on 04-11-2022 and going to attain 58 years in future say in 2024, 2025, 2030.
Answer: In this case the Employer contributed on Full Wages till now and he still has to contribute every month till the Employee attains the age of 58 years. Hence the Joint Option carries more weight in this case, because the Employer may refuse to contribute on Full Wages in future which is within the period of the Employee attains 58 years for any reason.
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Date of Birth………………………………..01-01-1972
Date of Joining…………………………….01-07-1999
Date of attaining 58 years…………….31-12-2029
Here Employer contributed on Full Wages only upto 31-12-2022 and he has yet to contribute for the remaining period of 01-01-2023 to 31-12-2029 i.e., for another 7 years. Hence here the Joint Option of Employee and Employer carries more weight.
Employees who attained 58 years and already retired:
Here the Employer contributed on Full Wages till the Employee attained 58 years. Only maximum of 417/-, 541/- and 1,250/- towards Contributions of EPS,’95 were transferred to P.F.Commissioner and the remaining amount in the Employer’s Contribution along with the Employee’s Contribution taken by the Employee as settlement. Now it is the Employee who has to pay the difference of 8.33% between the Ceiling and Full Wages on his own direct to the P.F. Commissioner. In this case the role of the Employer is nominal.
Finally it is the question of submission of Option under Proviso to Para No: 11(3) or under both Proviso to Para No: 11(3) and 11(4) to P.F. Commissioner, in whichever way it is possible i.e., either through Management and incase the Management refuses to forward then through Lawyer or through RTI route. The reach of the Option Form in the Office of the P.F. Commissinoner is important that too duly acknowledged.
G. Srinivasa Rao, Mobile No: 89851 72459 & Mobile No: 86398 71817