Confused About EPS Contributions with Higher Wages? Here's How to Handle It

I previously worked as an intern at an organization for two months, during which my EPF wages were 15,000, but no pension contribution was made. However, in the service history, joining and ending dates for both EPF and EPS have been mentioned.

Based on the service history dates, I thought I was a member of EPS, and while joining my current organization, I submitted FORM 11 stating that I was a member of EPS. In my current organization (exempted trust), my wages are greater than 15,000 but EPS contribution is being made based on FORM 11. Do I need to get my EPS contribution stopped or let it continue? If I need to get it stopped, how do I do that? Or should I get my funds reallocated in my previous organization? Please clarify.

EPS Contribution Verification

If your salary in the first establishment was not more than Rs. 15,000, they should have contributed to EPS as well. You can verify this by checking the passbook of contributions. It is always beneficial if you have pension contributions along with PF contributions maintained in the trust.

Therefore, if the first organization had not made a pension fund contribution, ask them to do so, enabling you to proceed with it through your current organization.

Thanks, Madhu T K, for your response. I checked my passbook, and no pension contribution was made even though PF wages are 15,000. I tried contacting HR; they said I was not eligible for EPS, hence no contribution was made. I have attached my passbook for reference. Should I raise a grievance on the EPFO portal?

Yes, you should proceed with a complaint before the EPFO stating that you were rightfully eligible for pension fund contributions because your PF qualifying salary was not more than Rs. 15,000.

Hi Shanmuk, I believe the total wages in the previous organization were more than Rs. 15,000, and they would have restricted EPF wages to Rs. 15,000. In such a scenario, EPS is not applicable. If that is the case, please ask your current organization to stop the EPS and also request them to rectify the same.

Hi Jeevarathanam, Thanks for your response. Could you please explain the statement "restricted EPF wages to Rs. 15,000/-" and is this allowed? If my total wages are more than Rs. 15,000, shouldn't the PF contribution be made according to the total wages? Also, in my service history, both Date of Joining (DOJ) and Date of Exit (DOE) for the Employees' Pension Scheme (EPS) have been mentioned. Could you please clarify? I have attached my service history for reference.

Hi Shanmuk,

As per the EPF Act, the Wages Ceiling Limit is Rs. 15,000. Based on the Act, only the previous employer would have been restricted to Rs. 15,000. There is also a provision for higher EPF contribution, and a few organizations follow the higher contribution as well.

Please note that many manufacturing organizations and some service sectors restrict EPF contributions to a maximum of Rs. 15,000. In many service sectors and a few manufacturing industries, the contribution is based on the total basic salary.

There is no harm in mentioning the Date of Joining and Exit in EPS.

PF Qualifying Salary and Pension Fund Coverage

Even if the total wages are more than Rs 15,000, if the wages contributed to PF are Rs 15,000, then the same would be deemed the PF qualifying salary. In such a situation, the employer is expected to provide Pension Fund coverage to the employee.

Hi, I raised a grievance in the EPFO portal regarding this issue. I received a response stating that "no claim received, kindly apply claim for processing the same." Does this mean that I have to apply for a transfer request for the funds from my previous organization to my current organization? In that case, would all my funds be transferred to my current PF account with no amount allocated to the EPS account? Or is it that the previous employer can only reallocate my funds if I apply for a transfer request? Please clarify.

Yes, the transfer request should be initiated only after the first employer has reallocated the funds to the Pension Scheme. Otherwise, the EPFO will hold the transfer.

Hi Madhu T K, Yes, I have raised a grievance regarding my PF wages. I stated that my PF wages were $15,000, but no EPS contribution was made by my previous employer. The reply I received was, "No claim received, kindly apply for processing the same." What does that mean? Could you please clarify? A screenshot of the grievance reply is attached.

EPFO Grievance Redressal Process

It is unfortunate that the EPFO will not address any grievances of members for redressal with the employers. In the past system, the EPFO would initiate actions to correct issues with the employers, but now the process is different. Members are required to approach their past employers to rectify clerical errors or omissions. There have been instances where a member filed a case against a past employer with the EPFO also involved in the matter, which was eventually resolved by the employer.

Steps to Address Pension Fund Issues

You can send a notice to the past employer regarding negligent actions in failing to deposit your Pension Fund contributions. It is advisable to involve the EPFO in the notice. If there is no response from the employer or the EPFO, escalate the matter to a higher level within the EPFO. The online system proves ineffective in such situations. Seek legal assistance to draft and send a notice to the parties involved.