EPFO office in Jalandhar. Tribune file photo
New Delhi, April 19
The Central Government has put off by three more months an action to bar withdrawal of employer's contribution to the provident fund corpus until the employee attains the age of 58 years.
"The notification (tightening PF withdrawal norms) will be kept in abeyance for three months till July 31, 2016. We will discuss this issue with the stakeholders," Labour Minister Bandaru Dattatreya told reporters.
Implementation of the new rule has been postponed till July 31, a statement by the Labour Ministry said.
Several employees’ unions in the country have opposed the central government’s decision tighten rules that deal with Provident Fund. Online petitions against the decision have also been circulated since the decision was announced earlier this year.
The rule was to have been implemented from February 10 but opposition to it made the central government put it off until April 10.
Police had baton charged some garment factory workers protesting the amendment on Monday.
Dattatreya said a meeting of the Central Board of Trustee would be called "to see how best the employers' contribution to EPF (3.67 per cent of basic wages) can be utilised for workers."
The Labour Ministry is also considering a proposal to permit withdrawal of all accumulations by Employees' Provident Fund Organisation's (EPFO) subscribers on grounds of purchasing a house, serious illness, education as well as upcoming weddings of an employee’s children.
The proposal also allows withdrawal of all accumulation by EPFO members who have joined an establishment or firm of central or state government and became the member of contributory provident fund or old age pension under any scheme frame by them.
The union Law Ministry has yet to approve the proposal.
In February, the ministry had issued a notification restricting 100 per cent withdrawal of provident fund by members after unemployment of more than two months, among others.
After trade unions objects, the ministry decided to suspend implementing the rule until April 30.
Subscribers who have been unemployed for more than two months have until the end of July to apply for a final settlement of their dues.
"On the direction of Labour Minister, the said provision will now come into effect from August 1, 2016 by issue of an amended notification," the statement said.
Labour unions have been demanding complete withdrawal of the decision.
Earlier in February, the EPFO had amended the EPF Scheme 1952 to tighten the various norms for withdrawal of provident fund including increasing age limit for filing such claims by retiring employees to 58 years from 54 years.
Besides, the EPFO had also restricted withdrawal of PF to own contribution of subscribers and interest earned on that, if the claimant has remained unemployed for more than two months. The member would be able to withdraw employer's contribution on maturity.
It was stipulated that rules that require of two months' of unemployment will not apply for women resigning their jobs to get married, or due to pregnancy or child birth.
According to the new norms, subscribers will not be able to claim withdrawal of PF after attaining 54 years of age. They would have to wait till attaining the age 57 years.
Previous rules allowed subscribers to claim 90 per cent of their accumulations in their PF account at the age of 54 years and their claims were settled just one year before their retirement.
Experts claim the earlier clause was relevant because there were establishments where retirement age was 55 years or 56 years. But this will create a problem in private as well as public sector where people opt for voluntary retirement.
In another change, EPFO had made it mandatory to wait till attaining the age of 57 for claiming PF withdrawal for transferring that to the Life Insurance Corporation of India for investment in Varishtha Pension Bima Yojana.
Previous norms allowed subscribers to claim 90 per cent of their accumulations for investing in the scheme after attaining the age of 55 years. — PTI
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