With recent hike in salary of employees many employees have lost coverage under EPFO. Considering this scenario Employees’ Provident Fund Organization has requested Labour Ministry to issue PF ceiling limit 25000 notification. News regarding it came out on 9th December 2016 (9-12-2016) about possible proposal of Labour Ministry to increase mandatory EPF coverage of employees.
All employees of Inida are eagerly waiting to know regarding it’s implementation. Present Wage Ceiling limit as on December 2016 is Rs.15000. In this coverage limit only around 50 lakh employees get benefits. If wage ceiling limit for calculating mandatory EPF is increased from Rs.15000 (Rupees Fifteen Thousand) to Rs.25000 (Rupees Twenty Five Thousand), it will benefit around 4.5 crore employees. Employees Provident Fund deposits are helpful to all employees because they get an extra portion from employer too. And ability to take loan amounts from PF accounts is really a great advantage for PF account holders. With recent increase in minimum salary for State and Central government employees, may staff are now not under coverage of Provident fund scheme.
Raising limit of PF will favor all employees, while employers will find that it will eb an over burden for them. It’s sure that employers will protests again it , because with recent minimum salary hike itself they are facing difficulty, especially for small scale industries or companies. If PF wage ceiling limit is also increased they will get a huge liability on their heads. Based on requests by Trade Unions, employees to Employees’ Provident Fund Organization, it was decided to forward this to Labour Ministry to get a favorable reply.
Few weeks back Employees State Insurance Corporation (ESIC) has increased wage ceiling limit from Rs.15000 to Rs.21000. ESI scheme is helping crores of employees in India to get medical health benefits.
Like that Provident Fund scheme helps all employees to get a big amount at time of retirement. There are facilities to take loans from PF accounts or make partial withdrawals.
PF ceiling limit 25000 notification
EPF contribution of an employee is 12% of basic salary and employer also has to deposit 12% amount. By this way employees contribution and employers contribution will be equal.
Out of 12% contribution by employer 8.33% will be deposited in Employees Pension Scheme (EPS) and remaining will be credited to Employee’s Provident Fund (PF) account.
Along with this Indian Government pays additional 1.16% to each account of employee towards the EPS for an employee Employees Pension Scheme (EPS).
It’s expected that PF ceiling limit 25000 notification will be released by indian labor ministry soon. With EPFO asking labour ministry to raise mandatory wage ceiling of employees to Rs 25000 per month, there will be lot of benefits to around 4.50 crore employees.