Aatmnirbhar Bharat Abhiyan 3.0
*New Incentives for Businesses covered in PF to boost Employment*
If an establishment has less than 1000 employees, *24% PF* (12% Employees share and 12% Employers share) shall be paid by the Government for their *new employees* employed on or after 01.10.2020.
This benefit shall be for a period of *two years* from the date of employment
If employees are more than 1000, then only 12% Employees share shall be paid by the Government. Employer continues to pay their 12% share
*Conditions:*
Scheme is for employees with monthly wages less than *Rs.15,000/-*
If establishment has less than 50 employees, minimum 2 new employees be added
If you have more than 50 employees, you should employ minimum 5 or more new
New means, First time PF Registration, on or after 01.10.2020
Also, if any old employee lost or left job between 01.03.2020 to 30.09.2020, then on re-employment after 1.10.20 he shall get the benefit
Businesses which are not yet covered in PF but do so now shall get the benefit for *ALL* their employees
Scheme open till 30.06.2021
This is huge incentive by the Government to encourage businesses to add new employees and also to establishments not yet registered with EPFO to do so
Example, if an employee is at 14,999/- then Rs.1800/- (12% employee share) and Rs.1800/- (12% employer share), total Rs.3600/- per month shall be paid by the Government for 2 years
Total of 3600X24= Rs.86,400
Both Employer and Employee get benefit of upto Rs.43,200/- each year in 2 years
It means PF shall not be deducted from new eligible employees
Ironically, it means that New eligible employees get Rs.1800/- per month more than existing old employees presently drawing less than Rs.15,000/- wages per month, for 2 years
It also means that Employees who left on or after 01.03.2020 and rejoin after 01.10.2020 shall get this incentive of upto Rs.1800/- pm but if any loyal employee stayed back and continued to work or joined before 01.10.2020 shall not be eligible for this benefit.
nonetheless It is a grand incentive for new businesses that employ 20 or more employees on or before 30th June 2021
Its also a grand incentive for existing businesses not yet covered in PF (employees less than 20) or those who have avoided or evaded PF registration. Till now enforcement department of PF would not only recover old PF dues, they would also recover interest and penalty. But now, theres this huge incentive for such units to get voluntarily covered in PF.
*Example:*
Suppose one is able to adds 20 employees, it will mean benefit of upto Rs.43,200 X 20 X 2= Rs.17,28,000/- in 2 years
And for new employees that one adds till 30.06.2021, each employee shall get additional benefit of Rs.43,200/- per year.
The employees can also get benefit of 24% of basic wages upto Rs.3600/- per month as this amount shall be deposited in their PF account by the Government for 2 years.
From India, Telangana
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36*New Incentives for Businesses covered in PF to boost Employment*
If an establishment has less than 1000 employees, *24% PF* (12% Employees share and 12% Employers share) shall be paid by the Government for their *new employees* employed on or after 01.10.2020.
This benefit shall be for a period of *two years* from the date of employment
If employees are more than 1000, then only 12% Employees share shall be paid by the Government. Employer continues to pay their 12% share
*Conditions:*
Scheme is for employees with monthly wages less than *Rs.15,000/-*
If establishment has less than 50 employees, minimum 2 new employees be added
If you have more than 50 employees, you should employ minimum 5 or more new
New means, First time PF Registration, on or after 01.10.2020
Also, if any old employee lost or left job between 01.03.2020 to 30.09.2020, then on re-employment after 1.10.20 he shall get the benefit
Businesses which are not yet covered in PF but do so now shall get the benefit for *ALL* their employees
Scheme open till 30.06.2021
This is huge incentive by the Government to encourage businesses to add new employees and also to establishments not yet registered with EPFO to do so
Example, if an employee is at 14,999/- then Rs.1800/- (12% employee share) and Rs.1800/- (12% employer share), total Rs.3600/- per month shall be paid by the Government for 2 years
Total of 3600X24= Rs.86,400
Both Employer and Employee get benefit of upto Rs.43,200/- each year in 2 years
It means PF shall not be deducted from new eligible employees
Ironically, it means that New eligible employees get Rs.1800/- per month more than existing old employees presently drawing less than Rs.15,000/- wages per month, for 2 years
It also means that Employees who left on or after 01.03.2020 and rejoin after 01.10.2020 shall get this incentive of upto Rs.1800/- pm but if any loyal employee stayed back and continued to work or joined before 01.10.2020 shall not be eligible for this benefit.
nonetheless It is a grand incentive for new businesses that employ 20 or more employees on or before 30th June 2021
Its also a grand incentive for existing businesses not yet covered in PF (employees less than 20) or those who have avoided or evaded PF registration. Till now enforcement department of PF would not only recover old PF dues, they would also recover interest and penalty. But now, theres this huge incentive for such units to get voluntarily covered in PF.
*Example:*
Suppose one is able to adds 20 employees, it will mean benefit of upto Rs.43,200 X 20 X 2= Rs.17,28,000/- in 2 years
And for new employees that one adds till 30.06.2021, each employee shall get additional benefit of Rs.43,200/- per year.
The employees can also get benefit of 24% of basic wages upto Rs.3600/- per month as this amount shall be deposited in their PF account by the Government for 2 years.
From India, Telangana
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Hi Ramesh,
When the industry is struggling with the collapse of manufacturing, sales, payment crisis, etc., and is unable to pay their existing employees, how can one take on more fresh employment? Not only do they have to consider EPF, but they also need to pay salaries first, then ESIC, Profession Tax, Bonus, and other facilities as well.
In Atmanirbhar 3.0, the gross salary should be 15,000. This means the EPF contribution from both sides would be around 8,000 (basic) * 12% = 960 + 960 (employer) = 1,920. However, the employer's CTC would be much more.
Despite the challenges, we remain hopeful that if the industry can create at least a 1% increase in fresh employment, it would provide support to the workers who lost their jobs during the lockdown and help them survive.
Thank you.
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When the industry is struggling with the collapse of manufacturing, sales, payment crisis, etc., and is unable to pay their existing employees, how can one take on more fresh employment? Not only do they have to consider EPF, but they also need to pay salaries first, then ESIC, Profession Tax, Bonus, and other facilities as well.
In Atmanirbhar 3.0, the gross salary should be 15,000. This means the EPF contribution from both sides would be around 8,000 (basic) * 12% = 960 + 960 (employer) = 1,920. However, the employer's CTC would be much more.
Despite the challenges, we remain hopeful that if the industry can create at least a 1% increase in fresh employment, it would provide support to the workers who lost their jobs during the lockdown and help them survive.
Thank you.
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BENEFITS UNDER EPF.ppt
Benefits under EPF act.docx