The EPFO (Employees’ Provident Fund Organisation) has recently issued a circular with regards to regulating EPS (Employees’ Pension Scheme) entitlement of members having multiple accounts.
The circular states that whenever an EPS member possesses multiple account numbers for a number of employment, these are the rules which will come into force:
1. Actual basis: Pension from each establishment has to be worked out at the date of exit on actual basis.
2. Aggregate pension: Pension payable from all establishments will be aggregated provided that aggregate of pensionable salaries at any point of time will not exceed wage ceiling. As and when it exceeds the wage ceiling, the contribution received on such excess salary will be diverted to the PF account.
3. Minimum pension criteria: The minimum pension criteria will be applied to aggregated pension i.e., only on the total pension amount.
When a member becomes member of EPS on account of his wages on the date of joining being not more than the wage ceiling of ₹15,000 upon his joining another establishment without exiting from the first establishment at a later date, the regional office where the other establishment is covered will be responsible to ensure that total contribution into EPS will not exceed contribution payable on wage ceiling of ₹15,000.
From EPS to PF
Additionally, it will be ensured that with effect from Sept 1, 2014, if the wage in a single establishment exceeds ₹15,000 or aggregate of wages at the time of joining exceeds ₹15,000 in multiple establishments (concurrently and simultaneously), the full 24 percent PF contribution will be retained in PF account only, as in such cases, the member will not be eligible for membership of EPS, 1995.
The above instructions will be brought to the notice of all such establishments where such incidence of multiple memberships is more by the concerned ROs so that in the first instance itself the employers submit correct ECRs.
As in other cases, the pension shall be calculated and PPO will be issued by the RO from where the member finally exits EPS, 1995.
Similarly, if there are two overlapping memberships, the RO where member has joined subsequently shall be responsible to comply with instructions.
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Published: 30 Jan 2024, 03:32 PM IST