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In its first set of guidelines after the November order of the Supreme Court on higher pension, the Employees’ Provident Fund Organisation (EPFO) on Thursday told its field offices to implement the ruling’s directions for employees who had contributed higher pension on actual wages but their request was denied by the provident fund offices.
In a circular, EPFO said members who had contributed for pension on salary exceeding wage cap of Rs 5,000 or Rs 6,500 and exercised joint option along with employers for such contribution and their option was declined by PF authorities can now apply online to validate their option for a higher pension payout.
“The Central Government vide letter dated 22.12.2022 has directed that requisite action may be taken by EPFO to implement the directions contained in para 44 (ix) of the judgment dated 04.11.2022 of the Hon’ble Supreme Court within the stipulated timelines. Government has further directed that adequate publicity may be made to the decisions taken by EPFO to implement the said directions,” the circular issued on Friday said.
The circular, however, does not talk about other categories of EPS members.
On November 4, SC had upheld the Employees’ Pension (Amendment) Scheme, 2014, allowing another opportunity to EPF members who have availed of the EPS, to opt for higher annuity over the next four months. Employees who were existing EPS members as on September 1, 2014 can get the chance to contribute up to 8.33 per cent of their ‘actual’ salaries — as against 8.33 per cent of the pensionable salary capped at Rs 15,000 every month — towards pension, it said.
The SC had observed that a beneficial scheme ought not be allowed to be defeated by reference to a cut-off date where the employer was not following the ceiling limit of Rs 5,000 or Rs 6,500, and had deposited 12 per cent of the actual salary.
Para 44 (ix) of the SC judgement pertains to the earlier order in the case of RC Gupta wherein a cut-off date of eight weeks was outlined to implement the ruling and those who did not exercise the option for higher pension within the stipulated period, were deemed to have not opted for contribution over the pensionable salary cap and the extra contributions already made to the pension fund were to be diverted to the PF account of the member.
In 1995, through an amendment, EPS scheme was formulated for employees’ pension, wherein the pension fund was to comprise a deposit of 8.33 per cent of the employers’ contribution to be made towards the provident fund corpus. At that time, the maximum pensionable salary was Rs 5,000 per month, which was later raised to Rs 6,500 and then to Rs 15,000.
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