Why in the News?
The Parliamentary Standing Committee on Labour has recommended increasing the minimum pension of ₹1,000 paid by the Employees’ Provident Fund Organisation (EPFO) under the Employees’ Pension Scheme (EPS).
About the Employees’ Pension Scheme (EPS):
| Details |
- Introduced in 1995 by the Employees Provident Fund Organisation (EPFO) under the Ministry of Labour and Employment.
- Provides pension benefits to employees in the organized sector.
|
| Aims and Objectives |
- To provide pension benefits to employees in the organized sector.
- Ensures financial security for employees post-retirement or in case of disability or death.
|
| Features and Significance |
- Employee and Employer Contribution: Both contribute 12% of the salary towards the EPF.
- Employer’s Contribution: 8.33% of the employer’s contribution goes towards the pension fund.
- Union Government Contribution: 1.16% of the employee’s basic salary is contributed to the pension fund.
- Pension Fund Setup: The fund is created by allocating 8.33% of the employer’s contribution from the EPF corpus.
|
| Structural Mandate and Implementation |
Supreme Court in November 2022, the court upheld the Employees’ Pension (Amendment) Scheme, 2014, extending the deadline for opting for the new scheme by 4 months.
- Pre-Amendment Scheme: Pensionable salary was based on the average salary of the last 12 months prior to exiting the pension fund.
- Post-Amendment Scheme (2014): Pensionable salary based on average salary of the last 60 months (5 years).
|
| Eligibility Criteria |
- Applies to employees whose basic salary exceeds ₹15,000 per month.
- Employees who are members of the Employees’ Provident Fund (EPF) and meet the contribution requirements are eligible for the scheme.
|
PYQ:
[2021] With reference to casual workers employed in India, consider the following statements:
1. All casual workers are entitled for Employees Provident Fund coverage.
2. All casual workers are entitled for regular working hours and overtime payment.
3. The government can by a notification specify that an establishment or industry shall pay wages only through its bank account.
Which of the above statements are correct?
(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3 |
