EPFO caps pension contribution by firms

In a move that could have implications for employees and firms,the Employees Provident Fund Organisation EPFO has decided to not allow employers contribute higher than the mandatory amount towards its pension scheme in fresh cases. This amounts to capping the employers contribution to employees pension at Rs 541 per month.

8230;contribution to EPS-95 on higher wages would not be allowed and shall be limited to wage ceiling Rs 6,500, an EPFO communique to the field staff said. At present,the EPFO rules mandates employees to contribute 12 per cent of their basic salary towards Employees Provident Fund EPF while the employer deposits a matching share in EPF,EPS and EDLI in the ratio of 8.33 per cent of the salary in EPS,0.5 per cent in EDLI and the remaining 3.17 per cent in EPF.