Pension Details for EPS Members
When an EPS member dies, the spouse will receive a pension equivalent to the member's pension. However, in such cases of death, there is a minimum pension stipulated in Table C. Additionally, two children will each receive 25% of the above pension until they reach the age of 25 years. The details of the pension calculation are as follows.
There is no upper limit for the EPS-95 pension. For pension calculation, the service will be divided into two parts: service before 16.11.95 and service starting from 16.11.95. The former is referred to as past service, and the latter as pensionable service. Past service is divided into four slabs: service up to 11 years, 12 to 15 years, 16 to 19 years, and 20 years & above. If the salary on 16.11.95 is below Rs. 2500, the monthly compensation will be Rs. 80, 95, 120, and 150 respectively. For salaries of Rs. 2500 and above, the compensation will be Rs. 85, 105, 135, and 170. These amounts apply to those who turn 58 on 16.11.95. For those who turn 58 after 16.11.95, the compensation will be multiplied by a factor specified in Table B based on the difference between 16.11.95 and the date of completing 58 years.
Regarding pensionable service, there is a formula to calculate the pension: Pensionable Salary x Pensionable Service / 70. The pensionable salary can be categorized into three groups: 1) Below Rs. 6500, 2) Rs. 6500 and above but with contributions up to the statutory ceiling of Rs. 6500, and 3) Above Rs. 6500 and opted for contributions based on the actual salary. In the second category, the pensionable salary is Rs. 6500. In the other two cases, the pensionable salary will be the average of the last twelve months. Additionally, if the pensionable service is 20 years and above, a bonus of 2 years will be given.
For more details, please visit the website:
http://epfindia.com
An example calculation is provided below:
- Date of Birth: 2.1.1961
- Date of Joining: 23.2.1987
- Salary on 16.11.95: Rs. 2500 and above
- Salary on completion of 58 years on 1.1.2019: Rs. 6500 (Statutory Ceiling)
- Past Service: 8 years 9 months (approx. rounded to 9 years)
- Compensation: Rs. 85
- Factor as per Table B (for less than 24 years, i.e., the difference between 16.11.95 and 1.1.2019): 6.102
- Past Service Benefit: 85 x 6.102 = Rs. 519 - (A)
- Pensionable Service: 23 years
- Bonus (Service is 20 years and above): 2
- Pensionable Salary: Rs. 6500
- Pensionable Benefit: 6500 x 25 / 70 = 2321 - (B)
- Total Pension: (A) + (B) = Rs. 2840
Minimum Pension for Service Before 16.11.95
In addition to the above method of calculation, there is a minimum for those with service before 16.11.95. In the EPS-95, they are categorized into three groups:
1. Date of commencement of Pension before 16.11.2000
2. Date of commencement of Pension between 16.11.2000 and 16.11.2005
3. Date of commencement of Pension after 16.11.2005
As the first two categories are already completed, I will provide a brief explanation of the third category.
The minimum pensionable benefit is Rs. 635, and the past service benefit, as mentioned above, is subject to a minimum of Rs. 800 for 24 years or more of service. If the service is less than 24 years, this amount will be reduced proportionately (amount x actual service / 24). However, this amount will still be subject to a minimum of Rs. 450.
I will insert an Excel worksheet to calculate the pension. Please enter the Date of Birth, Date of Joining, Date of Separation from Service, Salary on 16.11.95, Salary on Separation from Service (in compliance with the contribution to the pension fund), and any break in service before and after 16.11.95, if any, in the green column. The results will be displayed in the yellow column, while the red column contains static information.
If you notice any errors or have suggestions, please inform me.
Regards,
Abbas P.S, ITI Ltd, PALAKKAD - 678 623