Labour Minister Bhupender Yadav has clarified that employees and pensioners covered under the Employees’ Pension Scheme (EPS) of 1995, “are not restricted from filing application forms for higher pension under the Employees’ Pension Scheme (EPS).”
He was speaking in Rajya Sabha in response to a question by CPI-M MP from Kerala, John Brittas, on the confusion surrounding the eligibility for higher pension, and the procedure to apply for the same.
The Employees’ Provident Fund Organisation (EPFO) had recently allowed subscribers, who have retired after September 1, 2014, to opt for higher pension under EPS. Accordingly, it also activated its portal to allow subscribers, which include these retired beneficiaries as well as those who continue to be in service, to sign up for higher pension.
Advertisement
The contention arose when it was observed on the EPFO portal at the time of submitting the forms that subscribers will be eligible for higher pension, only where the employee’s and employer’s contribution of 12 per cent each of the employee’s basic salary, is done with prior permission of EPFO. Apparently, both employees as well as employees (working as well as pensioners) say that they were not informed of this stipulation by EPFO earlier.
In 2014, EPFO had limited the maximum pensionable salary to be Rs 15,000. What it meant was that only 8.33 per cent of Rs 15,000 or Rs 1,250 would go to EPS.
Advertisement
According to the information on the EPFO portal, only employees and employers who contribute on salaries exceeding Rs 5,000 or 6,500 can opt for higher contributions. They also need to be members of the EPFO prior to September 1, 2014, and should have continued as members thereafter.
Also, applications for higher pensions have to be submitted jointly by the employer and the employee at the regional office of the EPFO in the manner specified by the commissioner.
Later in November 2022, the Supreme Court came out with a judgment allowing for higher pension.
Accordingly, EPFO issued a circular in February 2023 allowing employees who have been EPF members before September 1, 2014 to get an option to contribute 8.33 per cent of their actual basic and dearness allowance towards EPS, but with the catch of the employer and employee should have taken prior approval from the EPFO for a greater contribution.
Yadav has now informed Rajya Sabha that the joint option under paragraph 26(6) of the EPF Scheme “is a requirement which predates EPS”, and had been required as per provisions of the EPF Scheme, 1952.
He said that the process for submission of joint options (to be filed by the employees along with their employers) for higher pension is simple and easy to understand and contains simple requirements” in accordance with the provisions of EPF and EPS.
“For the convenience of members and pensioners, EPFO had directed its field offices located all over the country for assisting the applicants in filing the online forms. The last date for submitting the forms is May 3, 2023,” he said.
Advertisement
Yadav added that previously in December 2022, EPFO had called for online applications from pensioners who had retired before September 1, 2014. They had exercised the joint option for contributing to EPS beyond the statutory limit prior to their retirement, but EPFO had rejected the joint options because of the cut-off date.
Earlier on March 13, 2023, EPFO had extended the cut-off date to submit applications for higher pension, to May 3, 2023 from the previous date of March 3, 2023.
