Inoperative PF a/cs to earn interest from Apr 1

Inoperative a/cs are those where there have been no contributions by an employee or their employer for
36 months.

Inoperative accounts of Employees’ Provident Fund Organisation (EPFO) will earn interest payments beginning April 1, 2016. In its 212th meeting, the central board of trustees of EPFO decided to allow accrual of interest for over 9 crore inoperative accounts having deposits of over Rs 30,000 crore, reversing the decision of previous UPA government, which had stopped interest payments on inoperative accounts in 2011.

“UPA government stopped interest on inoperative accounts. We have taken a pro-worker decision to give interest on inoperative accounts with effect from April 1, 2016,” Labour Minister Bandaru Dattatreya said.

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Inoperative EPF accounts are those where there have been no contributions by an employee or their employer for 36 months. The decision not to make interest payments into such accounts was taken to persuade workers to either withdraw or merge their inoperative accounts with an active one. CBT is a tripartite body comprising government, industry and workers’ representatives. The labour minister is chairman of CBT.

The Board also approved restructuring of the EPFO along with formation of a implementation and anomalies sub-committee to look into the same.