An employee whose monthly wage is below Rs 15,000, universal account number (UAN) is seeded with Aadhaar, and who has a contributory member of EPF scheme and Employees’ Pension Scheme (EPS) for any period between September 2019 to February 2020, will be eligible for the 24 per cent contribution waiver for March, April, and May under the Pradhan Mantri Garib Kalyan Yojana, the Employees’ Provident Fund Organisation (EPFO) said in a set of FAQs released Friday.
Under the scheme, announced to counter the lockdown due to COVID-19, the 24 per cent contribution waiver (12 per cent for employers and employees each) will be for an establishment or a factory already covered and registered under the EPF Act, having up to 100 total number of employees, with 90 per cent or more of such employees drawing monthly wages less than Rs 15,000.
The eligible establishment under the scheme will have to disburse wages for all employees and file an Electronic Challan-cum-Return (ECR), which after verification will show the amount of employees’ and employers’ contributions due as central government relief.
After the employer makes the payments, the EPF and EPS contributions will be credited in the UANs of the eligible employees of the establishment by the Centre, the FAQs said.
The EPFO will send communication to such eligible establishments for payment of wages to employees and filing of ECR, it added. “The central government shall bear the entire liability towards the EPF & EPS contributions of the eligible employees in the eligible establishment. The employer of eligible establishments shall continue to pay the EDLI contributions and EPF administrative charges for all employees as well as the EPF & EPS contributions for ineligible employees,” an EPFO statement said.
An eligible employee under the scheme who is a member of the EPF scheme but not a member of EPS due to attaining the age of 58 years will also be eligible under the scheme, it said.
“So, there will be no deduction from wages of eligible employee so he/she will have a higher take home salary. Since the employer is also supported for employer’s share by the government, it prevents loss of employment of low wage earners and ensures payment of wages to employees,” the statement added.
Under the EPF scheme, employees and employers have to contribute an equal amount of 12 per cent of the employees’ basic salary plus dearness allowance. From the employer’s EPF contribution, 8.33 per cent is marked for EPS and the remaining to the PF account of the employer. The EPS component is subject to a wage cap of Rs 15,000, or actual basic pay, whichever is lower.
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