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WAGE CEILING FOR PF COVERAGE TO BE RAISED TO RS.15,000 per month

Also monthly pension Rs.1000 per month

The Finance Ministry has approved a proposal for providing a minimum monthly pension of Rs. 1,000 to workers in the organised sector, a move which would benefit 27 lakh pensioners immediately.

The ministry has also approved a proposal for raising the basic wage ceiling under the Employees Provident Fund Scheme to Rs. 15,000, from existing Rs. 6,500 per month

At present, there are about 44 lakh pensioners. Of this 27 lakh, including 5 lakh widows, get less than Rs. 1,000 a month.

The government will provide additional contribution of Rs. 1,217 crore to ensure the minimum monthly pension of Rs. 1,000 starting 2014-15. Pensioners are, therefore, expected to get benefit with effect from April 1 this year.

Labour Minister Oscar Fernandes, however, is yet to decide on whether the move requires the Cabinet approval or not.

The Labour Ministry's proposal on giving a minimum monthly pension of Rs. 1,000 under the EPS-95, run by the Employees' Provident Fund Organisation (EPFO), has been pending for a long time.

Earlier, the Labour Ministry had proposed that government should increase contribution on EPS-95 from 1.16 per cent of basic wage to 1.79 per cent to ensure minimum pension.

However, it did not find favour with the Finance Ministry as this would have resulted in a permanent increase in its contribution.

The Labour Ministry in its revised proposal has asked the Finance Ministry to provide for around Rs. 1,217 crore additional amount every year, and indicated that this amount can come down over a period of time with more members subscribing to EPS-95.
25th January 2014 From India, New Delhi
Thanks Yatin for providing this instant information...
here is the print media of same information..
my doubt is as the pension revision will take effect from 1st April 2014, will the EPF limit increment also be effective from 1st April 2014 only.
25th January 2014 From India, New Delhi

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Dear All Where the notification copy if approved by the central goverment. Regards, Ajay sharma
25th January 2014 From India, Palampur
Dear All, Scan copy of Dainik Jagran dated 24.01.2014 is attached for your referance. Thanks Mukesh Kumar Saini
25th January 2014 From India, Bareli

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Hi All,

Retirement fund body EPFO's trustees on February 5 will decide on amending its scheme to provide a minimum monthly pension of Rs 1,000, which will immediately benefit its 27 lakh pensioners.

The Central Board of Trustees (CBT), the apex decision making body of EPFO, will also decide on amending EPF scheme 1952 to raise the monthly wage ceiling to Rs 15,000 to cover more workers under its various social security programmes like provident fund, pension and employee deposit-linked insurance.

At present, workers getting basic wages, including basic pay and DA, of up to Rs 6,500 are covered under the ambit Employees' Provident Fund Organisation (EPFO).

"The Finance Ministry has approved the Labour Ministry's proposal to provide a minimum pension of Rs 1,000 per month and enhance the wage ceiling to Rs 15,000. Now, the trustees would meet on February 5 to approve the amendment in schemes run by EPFO to operationalise the two decisions," an official source said.

The Central Board of Trustees (CBT), the apex decision making body of EPFO, had earlier approved the proposal, following which the Labour Ministry pursued it with the Finance Ministry.

According to sources, after the nod given by the CBT, headed by the Labour Minister Oscar Fernandes, the two proposals would be put before the Union Cabinet for approval as the government would have to make provision of funds for the purpose.

The source further said that Finance Minister P Chidambaram may also make announcement on entitlement of minimum monthly pension of Rs 1,000 in his interim budget next month.

The entitlement of minimum monthly pension of Rs 1,000 to workers in the organised sector under the Employees' Pension Scheme 1995 (EPS-95), would benefit 27 lakh pensioners immediately.

At present, there are about 44 lakh pensioners. Of this 27 lakh, including 500,000 widows, get less than Rs 1,000 a month.

The other proposal for raising basic wage ceiling under the Employees Provident Fund Scheme to Rs 15,000 from existing Rs 6,500 per month is expected to bring in 50 lakh more workers under the ambit of schemes run by the EPFO.

The government would have to provide an additional amount of Rs 1,217 crore (Rs 12.17 billion) to ensure the minimum pension of Rs 1,000 starting 2014-15. Pensioners are, therefore, expected to get benefit with effect from April 1 this year.

The Labour Ministry in its revised proposal has asked the Finance Ministry to provide for around Rs 1,217 crore additional amount every year, and indicated that this amount can come down over a period of time with more members subscribing to EPS-95.

At present, government contributes 1.16 per cent of basic wage of workers as contribution toward the EPS-95. Government had provided around Rs 1,400 crore for the purpose in 2012-13.

The decision of enhancing the wage ceiling would also have some financial implication as government's contribution towards EPS-95 would increase towards EPS-95 as 50 lakh more wokers would join the schemes run by EPFO.
26th January 2014 From India, Hyderabad
HI All,
The news has been circulated in various national dailies and let this proposal get approval from Ministry of finance and the gazatte should be published for enforcement. Afterward only the rule become a law.
Thanks & Regards,
From,
Sumit Kumar Saxena
26th January 2014 From India, Ghaziabad
hai all,

This proposal was pending for a long time. Even now I don't think this Govt will be able to push it through before the election. Meanwhile the value of Rs1000 has eroded to an extent that this amount now looks like peanut,and probably by the time this is actually implemented this may not be even sufficient to buy your milk for a month.

I have a few doubts, if any one has answers please elucidate.

1: Currently pension is paid to widow & children of less than 25 years, in case of death of member while in employment. All are pensioners,will all of them get Rs 1000 minimum.

2. It appears it is only the minimum pension which is increased, which means one who gets even a rupee more than 1000 will continue to get that same amount only, or is there a proposal to increase pension across the board.

3. Any one who gets updates on this please keep posting on this forum.

4. Hope this gets implemented immediately before it gets entangled in political upmanship & before the elections are announced,so that it does not get held up again in model conduct issues.
26th January 2014 From India, Thane
guys don't confuse yourself with this. this has not been turned into a final law. this has been passed by ministry of labour however it has been forwarded to ministry of finance. after passing it from there then it would require cabinet approval. will take some time.
Regards,
Harpreet Walia.
27th January 2014 From India, New Delhi
Finance Ministry approved the proposal only..... it is not yet passed by the Union Cabinate....So let it be passed first then it will be applicable.....Newpaper cutting is a news only , it is not a law........., Official Gazatte published by union cabinate is the only authentic documents in support of its applicability. I think it will be passed by the union cabinet before the announcement of 2014 Lok Sabha Election..but till then existing law is applicable
27th January 2014 From India, Kolkata
Pleas refer the attachment for more information. Regards Darshan Palkar
27th January 2014 From India, Mumbai

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File Type: pdf 46th Session of Standing labour Committee Agenda items.pdf (341.5 KB, 259 views)

every thing is accepted , but where is the India Govt Gazatte...? you can not work on these documents . I agree with you that it is approved by the Finance ministry....bla bla bal.....But it will come into force at the moment it will be passed by the union cabinet
27th January 2014 From India, Kolkata
Hi All,
With the Lok Sabha Election 2014 on its way, i assume that this issue will surely get entangled. As the proposal made by the Labour Ministry has asked Finance ministry to provide an additional 1217 crores, which is indeed a big amount.
27th January 2014 From India, Mumbai
PROVIDENT FUND UPDATE

January 2014

Editor's Note

The number of beneficiaries and the volume of financial transactions undertaken by the Employees’ Provident Fund Organisation (EPFO) is the largest in the country. Its total assets is more than Rs. five lakh crore as on 1st May, 2013. This money belongs to the investors-employees and employers. Every organisation that employs 20 or more employees is obligated to be the investor. The scheme must enjoy the confidence and approval of all stake holders as far as its methods, fairness and integrity is concerned and that is how it can meaningfully contribute to the economic and social well being of members.

Despite all claims about improvements in the function of the organisation, we often hear about the alleged malfunctioning and the cases of corruption in the organisation. There has been a report in the Economic Times that out of 107.16 Lakh PF claims received during 01.04.2012 to 13.12.2012, around 7 lakh claims are pending for settlement. As per the provisions contained in para 72(7) of the Employees’ Provident Funds Scheme, 1952, all claims found in order are to be settled within 30 days but this time limit is hardly adhered to.

It is not that only employees have to run from pillar to post but the employers are also aggrieved by the provident fund authorities. Most of the employers are unaware that there is an EPF Appellate Tribunal (Delhi) – the only one for whole of India where they can file their appeals. What the Tribunal has been deciding is summarized below, which will be informative to know in order to ward off harassment by the provident fund authorities.

HIGHLIGHTS OF ORDERS OF EPF APPELLATE TRIBUNAL

COVERAGE OF ESTABLISHMENT EMPLOYING BELOW 20 PERSONS SET ASIDE

M/s. Sh. Mahabaleshwara Auto Industries (P) Ltd. vs. APFC, Bangalore, ATA No.793(6) 2005, decided on 26.12.2013

In an appeal filed before the Employees’ Provident Fund Appellate Tribunal, the appellant has challenged the orders dated 09.05.1997 and 18.12.1991, passed by the EPF Authority, under section 7-A of the Act, covering the establishment of the appellant for compliance of the Act as well as for determination of the PF dues.

The plea taken by the appellant is that it had never engaged more than 14 employees. Services of 3 security guards were engaged through a contractor M/s. Ex. Soldiers Industrial Security Services, covered under the Act.

The employees, already covered under the Act by their employer, cannot be counted again for covering the establishment of the appellant under the Act. Hence, impugned order is set aside. Appeal is allowed.

ARREARS OF WAGES - NOT TO ATTRACT INTEREST/DAMAGES

M/s. HSIL Ltd. vs. RPFC, Hyderabad, ATA No.561(1) 2012, decided on 6.11.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, questioning the validity and legality of order dated 15.05.2012, passed by the EPF Authority, under section 14-B of the Act, imposing interest and damages on account of delayed remittance in respect of arrears of wages paid later on in compliance of a settlement between the employer and the workmen/union.

‘Actually drawn’ must be understood as actually due, payable and drawn, if the disbursement has not occasioned, it must be understood as liable to be drawn and payable when they become due and payable. Accordingly, the levy of damages in the case in hand is contrary to the law settled by the Andhra Pradesh High Court and the impugned order is set aside. Appeal is allowed.

DAMAGES FOR LATE DEPOSIT SUSTAINED BUT INSTALMENTS ALLOWED

M/s. Air Force School vs. APFC, Bangalore, ATA No. 06(06) 2012, decided on 24.12.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, questioning the order dated 17.11.2011, passed by the EPF Authority, under section 14-B of the Act, levying damages for late deposit of PF dues on the ground that impugned order is arbitrary, illegal and pre-determined whereas the default of the appellant was not wilful.

The EPF Appellate Tribunal concluded that since the appellant had admitted the delayed remittance of dues, to remit the damages in instalments, hence appellant is permitted to deposit the damages and interest in 10 equal monthly instalments.

TRAINEES UNDER STANDING ORDERS ARE NOT EMPLOYEES TO BE COVERED

M/s. ISS Catering Services (South) Pvt. Ltd. vs. APFC, Chennai, ATA No.44(13) 2011, decided on 8.11.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, challenging the order dated 31.12.2010, passed by the EPF Authority, under section 7-A of the Act, determining the EPF dues in respect of trainees engaged on the basis of Certified Standing Orders.

The EPF Appellate Tribunal has held that the trainees were appointed and certification of Standing Orders was obtained subsequently. So long as the Standing Orders were not certified by the competent authority, the trainees appointed shall be governed by Model Standing Orders incorporated in the Industrial Establishment (Standing Orders) Act, 1946.

EXCLUDED EMPLOYEES NOT ENTITLED TO BE MEMBER OF PENSION SCHEME

M/s. Manikgarh Cement vs. RPFC, Nagpur, ATA No.529(9) 2011, decided on 6.12.2013

An appeal was filed before the Employees’ Provident Fund Appellate Tribunal, by the appellant, against the order dated 30.06.2011, passed by the EPF Authority, under section 7-A of the Act on the ground that the assessment of EPF dues in respect of ‘unrolled employees’ by the EPF Authority, is wrong and illegal.

The EPF Appellate Tribunal observed that it is an admitted fact by both the parties that the wages of the employees are above the prescribed limit of ‘excluded employees’ i.e. Rs.6500 per month. Such employees are to be treated as ‘excluded employees’ in view of para 2(f) of the Scheme. Even the excluded employees who attended the proceedings conducted under section 7A of the Act stated not to be interested in pension scheme, as per paragraph 26(6) of the Scheme, 1952. Hence, the impugned order is not sustainable and quashed.

NO INTEREST OR DAMAGES WHEN DEFAULT IS NOT WILFUL

M/s. Looksan Tea Estate vs. RPFC, Jalpaiguri and Another, ATA No.468(15) 2012, decided on 25.11.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, questioning the validity and legality of orders, passed by the EPF Authority, under section 14-B of the Act, imposing damages and interest on account of delayed remittance whereas the appellants have been suffering losses and delay was not wilful.

It is settled position that a penal provision should be construed strictly. Levy of damages cannot be construed as imperative by the reason of an enabling provision. After amendment to Para 32A of the EPF Scheme with effect from 26.09.2008, the damages are to be levied at the lower rate by excluding the element of interest included earlier. In the impugned order, the EPF Authority has not indicated the reasons for delay in remittance of EPF dues attracting levy of damages. There is no finding by the EPF Authority to establish that the appellant had unlawfully diverted the funds collected from the employees for its business use. Since there is no mens rea on the part of the appellant, damages or interest should not be levied. Hence, the impugned order is set aside.

DEFAULT IN DEPOSIT WHEN NOT WILFUL, PENAL DAMAGES UNJUSTIFIED

M/s. Shiv Herbal Research Laboratory Ltd. vs. APFC, Nagpur, ATA No.103(09) 2007 decided on 21.11.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, challenging the order dated 11.12.2003, passed by the EPF Authority, under section 14-B of the Act, levying damages and interest for delayed remittance of PF dues without giving opportunity of hearing, which is illegal.

Since the EPF Authority has failed to prove on record the wilful default on the part of the appellant, levy of damages be restricted to 25% of the actual amount of damages levied under the impugned order. The appeal is disposed of accordingly.

LEVY OF DAMAGES - REDUCED TO 5% WHEN DEFAULT NOT WILFUL

M/s. Kattima Export vs. APFC, Chennai, ATA No.293(13) 2012, decided on 29.11.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, questioning the order passed by the EPF Authority, under section 14-B of the Act, levying damages and interest for delayed remittance of PF dues on account of poor financial condition.

In the impugned order, the EPF Authority has not indicated the reasons attracting levy of damages. Since there is no mens rea on the part of the appellant, levy of damages be restricted to 5% of the actual amount of damages levied under the impugned order. Hence, the appeal is disposed of accordingly.

HIGHLIGHTS OF THE JUDGMENTS OF HIGH COURTS AND SUPREME COURT

An order passed by the EPF Authority under section 7-A of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, without affording an opportunity to be heard to the employer for submitting his defence, is liable to be quashed.

Rallis India Ltd. vs. The Asst. Provident Fund Commissioner & Ors., 2014 LLR 25 (Bom. HC)

An order passed by the EPF Authority determining the EPF dues towards employer and imposition of interest thereon for belated remittance is a composite order under Sections 7-A and 7-Q of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 and is appealable before the EPF Appellate Tribunal.

Arcot Textile Mills Ltd. vs. The Regional Provident Fund Commissioner and Ors., 2014 LLR 89 (SC)

When the evidence recorded by the Trial Court reveals that no cogent evidence has been placed and proved on record by the EPF Authority i.e. complainant to substantiate that during the material time, firm of the respondents was working, employing a particular number of workers etc., the question of depositing the EPF contributions by the employer does not arise.

Regional Provident Fund Commissioner vs. Atma Ram and Sons and Anr., 2014 LLR 29 (P&HHC)

Unless the issue with regard to contribution, as pending before the EPF Appellate Tribunal, is decided, the petitioner cannot be directed by the Employees Provident Fund Authority to pay interest and damages.

Guru Nanak College, Chennai vs. Assistant Provident Fund Commissioner, Chennai and Others, 2014 LLR (SN) 110 (Mad. HC)

No appeal Section 7-I of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 is maintainable for challenging the order, passed by the EPF Authority, imposing only interest under Section 7-Q of the Act.

Arcot Textile Mills Ltd. vs. The Regional Provident Fund Commissioner and Ors., 2014 LLR 89 (SC)
29th January 2014 From India, New Delhi
Dear All,
If any of the member got the copy of the notification, then kindly share here.
Because, till the notification will not be issued, it could not be implemented.
As there are some news paper have claimed that the wage ceiling revision has been approved by the finance ministry, but no information has been posted regarding its effectiveness. Whereas for revision of pension, it is clearly mentioned that it will be revised w.e.f. 01-04-2014.
So, it will be better to have notification before implementing the same, as we are answerable to the management also.
30th January 2014 From India, Delhi
Dear All, Kindly provide us the copy of Government Order (G.O.)
30th January 2014 From India, Haridwar
How you can got the copy as the same is not passed by Union Cabinet ?? Friend , always remember that this types of notification can be published only after it is approved by the Union Cabinet through vote of confidence... So , just wait and see what is going to be happened..But it's for sure that this bill will be passed before the declaration of next Loksabha Election.......because this types of bill can work as a vote bank...
30th January 2014 From India, Kolkata
The comments posted by Mr Yatin Pundhir is good .....It can help us to increase our knowledge.......But regret to say that the same posting is not relevant to the main topics..... and it can create unwanted confusion to the members.......Requestiong to be more specific and simple so that all the general members can digest the topics.....
30th January 2014 From India, Kolkata
Useful update. Let these proposals be endorsed by the Central Govt. Warm regards, Sourav Mukherjee
31st January 2014 From India, Bangalore
Dear Seniors,
As per the latest decision from the Central Board of Trustees in regards of raising the monthly wage ceiling to Rs. 15000/- from Rs 6500/-, we would like to the when is the said law applicable from.
As per our knowledge the said law was passed on February 05th, 2014 but there is no mention for its date with which it is effective.
Kindly revert.
Thanks & Regards
Ms. Chakrapani
6th February 2014 From India, Mumbai
PROVIDENT FUND COVERAGE AT RS.15,000 AND MINIMUM MONTHLY PENSION RS.1,000 TO START SOON

The Central Board of Trustees (CBT), the apex decision making body of Employees' Provident Fund Organisation on 5th February, 2014 has decided to amend Employees' Provident Fund Scheme to raise the monthly wage ceiling to Rs.15,000 from Rs.6,500 for coverage of an employee.

According to EPFO, the Finance Ministry has already approved the Labour Ministry's proposals for entitlement of minimum monthly pension of Rs.1,000 and enhancing wage ceiling for coverage to Rs.15,000 per month.

PROVIDENT FUND UPDATE



The Employees Provident Fund Organization (EPFO) is inflicted with inefficiency and opacity leading to the unmitigated hardships to all stakeholders despite the fact that the administrative charges are paid by the employers alongwith the contributions. In view of the glaring lacunas in the Act and inefficient management of the Organization judicial interpretations, come to the rescue. We summarized the judicial interpretations of 2013, which are produced below.

HIGHLIGHTS OF ORDERS OF EPF APPELLATE TRIBUNAL

AS DIGESTED IN 2014

Damages waived in the absence of proper enquriy and identification of beneficiaries

Loss making company permitted to deposit outstanding in instalments

20% towards labour charges in the cost of construction - to be set aside for want of identification of beneficiaries

Determination of dues without making physical verification and identification of beneficiaries - to be quashed

Damages untenable if default in deposit is not willful

Coverage of establishment employing less than 20 persons set aside

Arrears of wages - not to attract interest/damages

Trainees under model standing orders are not employees to be covered

No interest or damages when default is not wilful

Excluded employees not entitled to be member of pension scheme

Default in deposit when not wilful, penal damages unjustified

Damages for late deposit sustained but instalments allowed

Levy of damages - reduced to 5% when default not wilful

5% damages appropriate when delay in deposit of dues is not wilful

Coverage of a trust needs fresh consideration

Levy of damages without considering the reasons for delayed deposit to be re-examined

International workers when availing benefit of PF and pension - not to be covered in India
6th February 2014 From India, New Delhi
Greeting all ! if Bills will passed, what the employer contribution of ceiling in PF. is it 1800 ?
15th February 2014 From India, Visakhapatnam
Dear All,
Hereby i attached EPFO circular dated 28/08/2014 where in notification regarding enhanced statutory wage ceiling to Rs. 15,000/-, minimum Pension of Rs. 1,000/- per month and 20% additional relief on the amount of assurance benefit admissible under EDLI Scheme has been notified for implementation.
28th August 2014 From India, Chennai

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File Type: pdf Circular-Min pension 1000 and limit enhanced to 15000.pdf (259.5 KB, 127 views)

While increasing the ceiling the PF authorities should also think of small and medium sector entreprenears. Recently the ceiling was raised from rs 6500 to rs 15000 and since the employer contribution is 13 36% the PF authorities can increase the wage ceiling after five years or reduce the employer contribution to 4 .75% as in ESIC scheme the SME will suffer if the ceiling is revised at preasent after a recent revision
This revision can bye effected for organisation employing above 150 employees or those with turnover of 50crores and above
29th December 2016 From India, Chennai
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