Understanding EDLI Claims: Is the Salary Cap Monthly or Averaged for Better Benefits?

Here is the case of my mother, who was diagnosed with cancer in July 2021. After the diagnosis, she had to go on continuous medical leave. However, she was declared cancer-free in March 2022 post her chemotherapies by the doctor. She resumed her duties in April 2022. Unfortunately, her cancer relapsed, and from July 2022, she had to go on leave again. Tragically, she passed away in January 2023.

Employee Deposit Linked Insurance (EDLI) Calculation

In the past 12 months, she had only received a salary for 3 months, from April 2022 to June 2022. Her basic salary plus Dearness Allowance (DA) was 65k. As per her calculation, her EDLI amount should be as follows:

Average monthly salary = (65000 * 3) / 12 = 16250 (max 15k)

EDLI = 35 x average monthly salary (15k) + 1.75 lakh bonus, totaling 7 lakhs.

However, we only received 3 lakhs as EDLI because the office capped the monthly wage at 15k instead of capping the average monthly salary at 15k. They considered the salary for April, May, and June to be 15000 each. Hence, their calculation was:

Average monthly salary = (15k x 3) / 12 = 3750

EDLI = 3750 x 35 + 1.75 lakhs

Clarification Needed on Salary Cap

I want to verify whether the monthly salary is capped at 15000 or the average monthly salary. If the latter is considered, our average monthly salary will be 16250, allowing for an additional 4 lakhs.

Additional Benefits Inquiry

Apart from Provident Fund (PF), pension, and EDLI, are there any other benefits that we can claim in case of death?

Hi Prashansag, Regarding the calculation of EDLI (Employees' Deposit Linked Insurance) benefit, it's essential to refer to the specific policies and regulations of the Employees' Provident Fund Organization (EPFO) in your country. The rules can vary from one jurisdiction to another.

Based on the information you provided, there seems to be a discrepancy in the calculation. If the EDLI benefit is based on the average monthly salary, then your calculation of 16,250 INR seems correct. However, if the EDLI benefit is capped at 15,000 INR per month, then the calculation provided by the office would apply.

To resolve this, I recommend contacting the EPFO or consulting with a legal or financial advisor who is familiar with the specific rules in your jurisdiction. They will be able to provide accurate advice based on the applicable laws.

Benefits Claimable in Case of Death

Regarding other benefits that may be claimable in case of death, this can also vary depending on the jurisdiction and the specific policies of your mother's employer. Some possible benefits to explore may include:

- Life Insurance: Your mother may have had a separate life insurance policy through her employer or privately.
- Gratuity: In some cases, a lump sum amount called gratuity may be payable to the nominee or legal heir in the event of an employee's death.
- Family Pension: Some employers offer a pension scheme that provides for a monthly pension to the surviving spouse or dependent family members.
- Accumulated Leave Encashment: If your mother had accumulated paid leave, this may be paid out to her legal heirs.
- Other Employee Benefits: Depending on the specific policies of her employer, there may be other benefits or compensation packages applicable in case of an employee's death.

Again, it's crucial to consult with a professional who is familiar with the specific laws and regulations in your jurisdiction to ensure that you are aware of all potential benefits and how to go about claiming them.

Regards,