Understanding Pension and Benefits: Can You Clarify These Common Eligibility Questions?

Following are the points on which I need clarification:

1) How much duration of service is required for eligibility for EDLI benefits?

2) If an employee dies in the 11th year of service, can the nominee withdraw 100% of the pension amount?

3) If an employee resigns in the 11th year of his service, is he eligible to withdraw 100% of the pension amount?

4) Is any nominee eligible for both pensions simultaneously (ESI & EPF)?

5) If an employee dies while off duty, is the nominee eligible for ESI & EDLI benefits?

Please clear my doubts.

The queries are answered below in seriatim:

1. EDLI Coverage

The EDLI is a part of the PF package, and the coverage is automatic with the PF membership. The coverage is not dependent on the length of service of the employee. It is a life insurance policy, contributed entirely by the employer, and is redeemable in the event of the death of the employee while in service.

2. EDLI Sum Assured

The nominee is eligible to receive the EDLI sum assured. The maximum assurance benefit under the 'Employees' Deposit Linked Insurance' (EDLI) scheme was increased to Rs 7 lakhs on 28 April 2021, from the earlier limit of Rs 6 lakh. The pension is payable under the EPS.

3. Pension Payable Under EDLI and EPS

In EDLI, no pension is payable. In EPS, the employee or nominee cannot withdraw 100% of the pension amount. The pension will be a regular monthly payment.

4. Pension Under ESI Scheme

No pension is payable under the ESI Scheme. It is a permanent disability benefit or dependent benefit and is entirely separate from the pension under the EPF Scheme/EPS.

5. Difference Between ESI & EPF Schemes

ESI & EPF Schemes are totally different in scope and application. Eligibility in one does not affect the applicability of the other. They are not mutually exclusive.

Overview of Employee Deposit Linked Insurance (EDLI) Scheme

EDLI is an insurance scheme offered by the Employees' Provident Fund Organization (EPFO) to EPF (Employees' Provident Fund) members. It provides financial security to the family of an EPF member in case of the death of an EPF member while on duty.

Eligibility criteria for EDLI benefits

To qualify for EDLI benefits:
- Active member of EPF: The deceased employee must be an active member of EPF at the time of death.
- Minimum Service Requirement: Unlike the pension scheme, there is no minimum length of service required to qualify for EDLI. Even if an employee worked for a short period, their nominee or legal heir is entitled to claim the benefit.
- Covered under EPF: The employee has to contribute to EPF at the time of death.

EDLI Advantage: Points

Amount of Benefits:

Benefits are calculated based on the employee's monthly salary (basic + DA). The maximum premium is ₹7 lakh (revised from ₹6 lakh in 2021).

Who can apply:

A discharged employee or legal heir of a deceased person may file an application.

Documents Required:

- Death Certificate of Employee
- EPF Account Information
- Written proof of identity

Additional Information:

Linked to EPF contribution: If the employer contributes to EPF, the EDLI benefit is paid automatically. No separate premiums: EDLI is covered by the employer, and employees do not have to pay separate premiums.