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Committee Backs the Proposal to Increase the EPFO Wage Ceiling to Rs 21,000
The government will probably increase the monthly EPFO wage ceiling to Rs 21,000. Currently, it stands at Rs 15,000. The discussion regarding the hike in the monthly wage ceiling of mandatory Employees’ Provident Fund cover has been ongoing for quite some time now. There have also been requests to the government seeking leave provisions for different classes of workers according to the nature of their job.
A high-level panel has backed the proposal of increasing the wage ceiling under the Employees’ Provident Fund Organisation (EPFO) to Rs 21,000 a month. The committee has nevertheless mentioned that the government could implement the hike later after considering all inputs.
The Bharatiya Mazdoor Sangh (BMS) has persuaded the government not to deduct the PF of individuals whose monthly salary is Rs 15,000. As per BMS, the deduction needs to be done for individuals receiving Rs 21,000 as their monthly salary. The minimum criteria/salary for which EPF deduction is being made must be raised to Rs 21,000. It is expected that the government will announce its decision soon.
BMS had demanded to increase the cap on earned leaves to 300 days in January 2020, from the 240 days recommended in the new rules of labour codes. The labour union raised this demand in the consultation meeting held by the Union Ministry of Labour and Employment on the draft rules related to two labour codes — the Social Security Code and the Occupational Safety Health and Working Conditions Code (OSH).
The wage limit of the mandatory EPF has not been modified since September 2014. EPFO had also recommended a wage limit of up to Rs 25,000 per month concerning coverage under the social security schemes. Once the EPF wage ceiling hike is implemented, it could inflate the government’s yearly Employees Pension Scheme (EPS) outflow by 50% to Rs 3,000 crore.
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