How to Handle EPS Withdrawal for Employees Joining After Age 50 Without 10 Years of Service?

Dear HR professionals/experts,

I am responsible for regional HR in Asian countries, and India is one of the countries under my care. I have a question regarding EPS withdrawal without completing 10 years of eligible service and hope that you, as experts, can shed some light on this.

EPS Withdrawal for Employees Joining After 50 Years

For employees who join EPS after the age of 50, since they will never be able to complete 10 years of eligible service for monthly pension entitlement, how do we calculate their pension amount when they reach 58 years of age? Should the calculation be based on Table D, and will they receive a lump sum pension payout at the age of 58? Or is there a special provision for this group of people since it is not their intention to not complete the 10 years of eligible service?

I found the information below on the EPF India website, but it does not provide further explanation. Therefore, I would appreciate it if someone here could provide guidance on this matter.

"A member joining after 50 years of age, if not a pensioner, does not have the choice of not receiving the Pension Contribution on grounds that he/she will not complete 10 years of eligible service. The social security cover is applicable as long as he/she is a member."

Link --> http://epfindia.com <link fixed>

Thank you very much.

Employees with less than 10 years of service in the EPF are not eligible to receive a pension. Instead, they are entitled to a one-time withdrawal benefit. The calculation is based on a factor as per Table D multiplied by the average salary of the last twelve months, with a salary ceiling of Rs. 6500.

Regards, Abbas.P.S

Minimum 10 years are required to gain eligibility. If an employee joins at the age of 50, they need to contribute for 10 years until the age of 58. However, in your case, only 8 years of contribution will be counted, so they will not be considered for the pension benefit. If the employee was employed with any organization before the age of 50 and did not withdraw the EPS amount, then they are eligible. If they are joining the EPS as a fresher, then 10 years of eligibility is required. If they contribute for 8 years, they may withdraw that amount as prescribed in the schedule.

Pension Benefit Eligibility

To avail of pension benefits, the member:
- Should have completed 10 years of continuous service, or
- Should have attained the age of 50 years or more,
- Should not receive any other EPF pension.

The member will receive the pension amount on a monthly basis after attaining the age of 58. If the employee does not fall into the above criteria, they can apply for the withdrawal of pension monies.

Regards.

To get the benefits of EPS, a member's service period must be 10 years or more. If it is less than 10 years, the member can withdraw both PF and EPS amounts with interest after leaving the job. Age is not a factor for withdrawal, but it does play a role in providing benefits. In case the member passes away, their family will receive a pension as per EPS rules and regulations.

Regards,
Nilesh Bhatt
Mobile: [Phone Number Removed For Privacy Reasons]

As per your question, the eligibility to get EPS benefits requires 10 years of service. If this eligibility is not met, the complete accumulation can be withdrawn using Form 10C, as stated earlier. In your case, the only way to avail of EPS benefits is if the employee has any EPF/EPS accumulation that has not been withdrawn, which can then be merged with the present service using Form 13.

Thanks & Regards,

Sumit Kumar Saxena