How Does the New PF Wage Limit Affect Your Pension and Salary from September 2014?

PF Gazette Notification

Please find the PF Gazette notification on the enhancement of the statutory wage limit to Rs. 15,000 per month, with a minimum pension of Rs. 1,000 per month. This change will be effective from 01 September 2014.

Regards,
Vaibhava Mahamunkar
Head - Human Resources
Secure Parking Solutions Pvt. Ltd.

The issue was pending for a long time. Now, the appropriate government has issued the notifications, thus ending uncertainty in the matter.

There are a few practical questions while implementing this policy.

1) If the basic salary of an Employee "A" is less than Rs. 15,000/-, how do we need to contribute for EPS? Is it 8.33% of the basic pay or a minimum of Rs. 1,000/-?

2) If an Employee "B"'s total gross salary is Rs. 40,000/- and Basic is only Rs. 10,000/- (25% of gross is basic) with the rest of the amount adjusted towards Special Allowance (excluding HRA, Conveyance, PF), how do we need to calculate the pensionable wage? Do we need to change the calculations from the existing basic of Rs. 10,000 to Rs. 15,000?

3) Is there any rule regarding what percentage of the total salary should be basic?

Experts, kindly advise.

Regards,
Jyothi