An important news related to EPFO is coming out. The salary limit under the Employees’ Provident Fund Organization (EPFO) can be increased from the existing Rs 15,000 to Rs 21,000 per month. A high-level committee has backed a proposal suggesting a hike in the wage ceiling.
With the implementation of this proposal, 75 lakh employees will come under the purview of EPFO. After coming under this purview, they will also get the benefit of various schemes of EPFO. The EPFO had sent a proposal in this regard to the Finance Ministry about four years ago.
Salary limit was increased in the year 2014
This high committee said that considering its advantages and disadvantages, the government can implement it later as well. At present, the salary limit to become a mandatory member of EPFO is Rs 15,000. If this seam increases, lakhs of employees will come under its purview. Along with this, they will get the benefit of the facilities of EPFO. In the year 2014, the salary limit for PF was increased. Then it was increased from 6,500 to 15,000 rupees.
employees will benefit
According to a report in ET, a senior government official told that the adhoc committee on EPFO coverage has agreed to increase the salary limit on the lines of the EPF Act. The committee says that if the Central Board of Trustees of EPFO implements this, then the employees will benefit greatly in this era of inflation.
“Balance Sheet Pressure”
According to the committee, this proposal was also discussed with the employers. Companies say that their balance sheets are under pressure due to the Corona epidemic. Therefore, the need of the hour is to implement such a proposal.
This will increase the burden on the employers as well as the government. At present, the government gives Rs 6,750 crore every year in the EPFO’s pension scheme i.e. EPF. Under this scheme, the government contributes 1.16 percent of the total salary of EPFO members.
As per the current rules, it is mandatory for a company with 20 or more employees to be registered with the EPFO. Also, EPF scheme is mandatory for employees with salary less than Rs 15000. With the increase in the salary limit to Rs 21,000, more and more employees will come under the purview of the retirement plan. With this, the salary limit will be equal to that of Employees’ State Insurance Corporation (ESIC).