#1 - EDLI Coverage Increased to Rs.3,00,000 + Additional benefit of 20%
Implemented w.e.f 1st September 2014, enhanced EDLI increased the benefits received by the next of the kin of the employee. Now under the revised norms, the death benefit payable would be Rs.3,60,000/-
Points to note :
• EDLI Admin Charges is linked to Basic PF Wage. With this being increased to Rs.15,000 (earlier Rs.6,500), EDLI Admin charges are also increased.
• Employers who have setup EDLI Insurance outside the EPFO (with private insurers), will now be required to increase their coverage to Rs.3,60,000. This results in a higher annual premium outflow.
• Good for the employee - The nominee would now stand to get a higher benefit.
This results in an increase in the Actual C.T.C of the Employee.
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#2 - No Pension Membership if Basic Salary exceeds Rs.15,000 - Only for new employees joining on or after 01.09.2014
Incase of a new employee joining after 01.09.2014 and his Basic PF Wage is equal to (or) is in excess of Rs.15,000 - He/She shall not be eligible to join the EPS, 1995.
Points to Note :
• No change shall be undertaken for the current (or) exisitng employees. They shall continue to be members of both EPF and EPS. EPS diversion for such employees shall be at 8.33% of the PF Wage, limited to Rs.15,000
• Furthermore, provision for contribution of EPS on higher salary has also been withdrawan, hence no new requests shall be entertained.
?This results in extending the EPS benefits only to those individuals who's Basic PF wage is lesser than Rs.15,000. No pension benefits for the rest !
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#3 - International Workers spared - No EPS from 01.09.2014
Huge money of Expats was getting blocked because of the contributions to EPS, which they never enjoyed (or) used. This time, EPFO inline with the above notification has made it easier for expats to reclaim their social security contributions, either to their own country or withdraw in India.
Points to Note :
• This is only applicable for IW's who join on or after 01.09.2014
• To be eligible for no EPS, IW's Basic PF Wage should be equal or greater than 15,000
• For existing IW's (Employees as on 31.08.2014) - No change. Their contributions shall be split to EPF and EPS as done earlier.
This is a true reprise to the IW's.
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#4 - If EPS Contributions are in excess of Rs.15,000 - Government shall not contribute !
In many companies (particularly manufacturing & capital intensive), employees had opted to contribute in excess of the 8.33% of Basic PF Wage Limit, with prior approval of the concerned RPFC. Though the facility to contribute in excess of the statutory wage limit to existing members continue, government's contribution of 1.13% will stop !
Points to Note :
• All such members are asked to excercise fresh request to continue contributions in excess of their Wage Limit, within 6 months time.
• They will also have to contribute the 1.16% of the government's share, hence Total Contribution of such members shall be 8.33% + 1.16% in excess of Rs.15,000
Drawback to the Employer/Company is that they should contribute to the EPFO Admin Charges for the 1.16% recovered from the employee, which can run into a sizeable sum over few years.
thanks..