Understanding PF Calculations: Who Covers EDLI and Admin Charges After Supreme Court Order?

Dear All,

Please guide on the calculation of PF as per the Supreme Court order and who is responsible for paying EDLI and admin charges.

Employer and Employee Contributions to EPF, EPS, and EDLI

The employer makes contributions to these schemes on behalf of the employees. The employee contribution is deducted from the salary before it is credited. Employees themselves do not need to make any direct payments to these schemes.

Contribution Calculations

The contribution of employees is calculated as follows:
- For EPF: 12%
- For EPS: None
- For EDLI: None

The contribution of the employer is calculated as follows:
- For EPF: 3.67%
- For EPS: 8.33% or Rs. 1,250/-
- For EDLI: 0.50% or a maximum of Rs. 75/-

Purpose of the EDLI Scheme

The chief motive of the EDLI scheme is to offer financial security to the family members of the policyholder (deceased person). Family members include the spouse, unmarried daughter, or male child up to 25 years of age. Employees cannot choose which of the three schemes—EPF, EPS, or EDLI—they want to opt for, but these are transferable with any change in employment. The new employer will continue to make payments into the existing account only.

Hi,

Is this EDLI charge also paid by the employee's salary?

Regards,
Ankita

Is the Supreme Court order to be considered valid for EPF deductions/contributions on gross salary, which includes basic DA and any other allowances that are paid regularly, generally, and uniformly to all employees, except HRA (Read in an order). Where in EPF authorities so far have not officially notified about any such change mentioning the Supreme Court order. Requesting if any of the respected members have any latest updates, please share in detail. Maybe I might have missed some updates if any.

Hi Ankita,

EDLI and Admin charges are paid by the employer and not deducted from the employee's salary unless you are following a CTC structure.

Regards,
Vishakha M

If an employee joined in 1995 and opted for an 8.33% higher EPS contribution, then what will be the pension calculation?

Whether:

1) The average last 60 months EPS contribution is supposed to be Rs. 21,450, then Rs. 21,450 x 35/70 = Rs. 10,725 pension per month.

2) Or it will be divided into three parts:
(a) Rs. 6,500 (until the revision of the ceiling to Rs. 15,000),
(b) Rs. 15,000 until the Supreme Court ruling, and
(c) from the Supreme Court ruling to retirement.
The sum of (a + b + c) will be the final pension per month.