Benefits To Members Under Epf Schemesnew 184


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Benefits To Members Under Epf Schemesnew 184

  1. 1. Benefits to Members under EPF Schemes Major Benefits • Provident Fund Benefits • Pension Benefits • Death Benefits 1. Provident Fund benefits 1. Employer also contributes to Members PF @ 12% ( 10% in case of sick industrial co., any establishment having accumulated loss equal to its entire paid up capital and any establishment in Jute Industry, Beedi Industry, Brick Industry, Coir Industry and Gaur Gum Factories. ) 2. EPFO guarantees the Employer contribution and credits interest at such rates as determined by the Central Government. 3. Member can withdraw from these accumulations to cater to financial exigencies in life - No need to refund unless misused. 4. On resignation, the member can settle the account. i.e., the member gets his PF contribution, Employer Contribution and Interest. 2. Pension Benefits 1. Pension to Member 2. Pension to Family (on death of member). 3. Scheme Certificate • This Certificate shows the service & family details of a member • This is issued if the member has not attained the age of 58 while leaving an establishment and he applies for this certificate • Member can surrender this certificate while joining another establishment and the service stated in the certificate is added with the service he is gaining from the new establishment. • After attaining the age of 50 or above, the member can apply for Pension by surrendering this scheme certificate (if total service is atleast 10 years) • This is a better choice than Withdrawal Benefit, as a member dies holding a valid scheme certificate, his family will get pension (Death when NOT in service) 4. Withdrawal Benefit • If not eligible for pension, member may withdraw the amount accumulated in his pension account • The calculation of this amount is based only on (i) Last average salary and (ii) Service (Not based on actual amount available in Pension Fund Account) 5. No amount is taken from Member to give Pension to the Member. Employer and Govt. contributes to Pension fund @8.33% and @1.16% respectively 6. EPFO guarantees pension to members, even if the Employer has not contributed to Pension Fund.
  2. 2. Benefits to Members under EPF Schemes 3. Death Benefits 1. Provident Fund Amount to Family (or to Nominee) 2. Pension to Family (or to Parent / Nominee) 3. Capital Return of Pension 4. Insurance (EDLI) amount to Family (or to Nominee) • No amount is taken from Member for this facility. Employer contributes for this. 5. Nominee is basically determined as per the information submitted by the member at this office through FORM-2 How to become a EPF Member You, as your own, can not become an EPF Member. To become an EPF member, you have to work in an establishment which is covered under EPF and MP ACT, 1952. • If 20 or more employees are working in an establishment, EPFO will cover that establishment. • If Employer and Employees of an establishment desires, that establishment can voluntarily opt for EPF coverage even if the employees employed therein is less than 20. • If your establishment is not covered and atleast 20 employees are working in that establishment, you can approach EPFO to cover it. How to withdraw money from EPF To withdraw money from EPF Account, you have to either: • Resign or retire from the establishment and apply for settlement of PF in Form-19 • Apply for advance for some admissible purposes How to get Pension • If you have attained the age of 50 years or more and • If you have completed a total service of 10 years or more and • If you are not getting any other EPF Pension Then you have to apply in Form-10D at the EPF Office where you last worked through your last employer. If you want to draw pension from a different place, you have to furnish appropriate Bank / Post Office address in the application form. Pension is distributed through Post Offices or through some designated banks only (eg: Indian Bank, SBI, Indian Overseas Bank, HDFC Bank, ICICI and UTI Bank ) Four situations when Pension can be applied for: 1. On superannuation The member can continue in service while receiving this pension Age 58 years or More and atleast ten years of On attaining 58 Years of age, a EPF member cease to service be a member of EPS automatically
  3. 3. Benefits to Members under EPF Schemes 2. Before superannuation Age between 50 and 58 years and at least ten The member should not be in service years of service 3. Death of the member Death while in service or Death while not in service Permanently and totally unfit for the employment which 4. Permanent disability the member was doing at the time of such disablement • No pensioner can receive more than one EPF Pension. How to settle EPF account • You have to resign or retire from the establishment and apply for settlement of PF in Form-19. If the exit is before 55 years of age, the member should not work in any covered establishment for a period of 2 months from the exit date. • If the member dies, Family members/Nominee have to apply in Form-20 for settlement of PF (In case of death, apply in From-10D and Form-5IF for Pension and EDLI also) How to transfer my account / What to do if I join another establishment You have to apply in From-13(R) through the NEW Employer at the EPF Office from which transfer is sought clearly stating New and Old EPF Numbers. You have to obtain new EPF Number from your New Employer. New EPF Number will be allotted by New Employer, not by EPFO. Employees' Deposit Linked Insurance (EDLI) Scheme On death of a member, the Family Members or Nominee (whoever has the entitlement to claim Provident Fund amount) can claim for EDLI Benefit. Maximum amount payable is Rs. 60,000/-. The nominee(s) have to apply in From-5IF through the Employer. No amount is taken from the Member for this facility. Employer contributes for this. Average PF Balance, salary and service are the factors considered for the calculation of this amount Do's and Don'ts of Members DO'S FOR A MEMBER: 1) While joining an establishment, furnish details of previous employment if any, with previous Provident Fund a/c number and scheme certificate. 2) In case of existing Provident Fund/ Pension a/c, apply for transfer of previous a/c number to the present a/c number.
  4. 4. Benefits to Members under EPF Schemes 3) Ensure that employer furnishes Form-5 with details of previous Provident Fund a/c no. to Employees' Provident Fund Organisation. 4) Execute Form-2, with details of self, nominee for Provident Fund and pension and details of family, so that it is forwarded to Employees' Provident Fund Organisation by the employer. 5) Ensure that particulars furnished are correct in all respects. 6) Ensure that enrolment to Employees' Provident Fund/ Employees' Pension Scheme is done immediately on the date of joining the establishment. 7) Ensure that Provident Fund is deducted at statutory rate from the total wages i.e. basic, D.A. and retaining allowance if any. 8) If desirous of enhancing rate of contribution, inform your willingness with the higher rate opted and forward to Employees' Provident Fund Organisation through employer and allow employer to deduct at enhanced rate from the wages. 9) If the wages drawn is more than Rs. 6500/-, intimate your willingness to contribute on the whole salary as per higher rate to Employees' Provident Fund Organisation through employer. Employer can also contribute on the whole amount drawn as wages under intimation to Employees' Provident Fund Organization. 10) Check up periodically with the employer that contribution and other charges are paid to Employees' Provident Fund Organisation and ensure it's correctness by verifying the Form-3A (contribution card) maintained by the employer. DON'TS FOR A MEMBER: 1) Don't give false declaration and incorrect particulars to Employer and Employees Provident Fund Organisation. 2) Don't fall victim to middleman/ agents. Please Contact PRO for Doubts / Clarifications if any. 3) Don't allow Employer to deduct his own share of contribution or administrative charges payable by him from your wages. 4) Don't be a party to misclassification of allowances of your wages, with a view to avoid payment of Provident Fund. Advance/ Withdrawals may be availed for the following purposes : • Marriage / Education • Treatment • Purchase or construction of Dwelling house • Repayment of Housing Loan • Purchase of Plot • Addition/Alteration of House • Repair of House • Lockout • Withdrawal Prior to Retirement • Other Advances
  5. 5. Benefits to Members under EPF Schemes • Notes Maximum Proof/ documents Type of Advance Purpose Eligibility Admissible required Amount** For the marriage of: Should complete Under Para 68-k of 50% of Employee Apply in Form-31 through the Scheme atleast 7 years of share at the time the Employer self service. of tendering the 1. application Bonafide Certificate duly 2. son, indicating the fees payable 3 times in the entire daughter from the educational service institution brother, • sister Marriage invitation card along with the application should be For education of : submitted through the employer self • son, • daughter For Treatment Purpose Eligibility Maximum Proof/ documents Type of Advance Admissible required Amount** Under Para 68-j of the For the treatment of 6 times of Certificates of proof as No • Scheme Wages mentioned in the minimum eligibility column self service • OR required Hospitalisation • Apply in Form-31 for 1 month or more • Certificate Full of through the Employer major surgical from ESI or • Whenever required for Employee operation in a from treatment share hospital Employer (whichever is suffering from that the ESI • less) TB, leprosy, facility are paralysis, cancer, not available mental derangement to the or heart ailment member and having been granted leave by his • a doctor employer for the [ or registered treatment of said medical illness practitioner] of 2. • the hospital family( spouse, son, certifies that a daughter, dependent surgical
  6. 6. Benefits to Members under EPF Schemes father, mother) operation or hospitalisation major surgical • for 1 month or operation in a more is/was hospital and 1 month necessary or more hospitalisation for the operation In case of • TB, leprosy ...etc., suffering from • a specialist TB, leprosy, doctor should paralysis, cancer, certify mental derangement or heart ailment For the construction/ purchase of dwelling unit (house/ flat) Maximum Proof/ documents Purpose Eligibility Admissible Type of Advance required Amount** For the Declaration in the Proforma Should • construction/ obtained along with complete 5 purchase of application signed by Years of dwelling unit Member service Under Para 68-B of the (house/ flat) Scheme Only • Apply in Form-31 through once in Employer service property • should be in Only Once (either the name of 36 times of 'construction or purchase of self or Wages house' or 'repayment of spouse or housing loan) jointly should • not be a joint Apply in Form-31 property owned by other than the spouse Repayment of housing loan Maximum Proof/ documents Purpose Eligibility Admissible Type of Advance required Amount** Repayment of • Under Para 68-BB of the Should complete 36 times of Declaration in the housing loan Scheme 10 Years of service Wages Proforma obtained with approval and signed by Only once in •
  7. 7. Benefits to Members under EPF Schemes service the Member property should • Apply in Form-31 through be in the name of Only Once (either the Employer self or spouse or 'construction or purchase of jointly house' or 'repayment of housing loan) should not be a • joint property owned Apply in Form-31 by other than spouse For the purchase of site/ plot Maximum Purpose Eligibility Admissible Proof/ documents required Type of Advance Amount** For the Under Para 68-B of the Should complete 24 times of Filled-up Declaration(from • purchase of Scheme Wages the Employee in the 5 Years of service site/ plot prescribed form and Only once in • enclosed with the service application. property should • be registered in the Only Once Copy of the Purchase name of self or Agreement spouse or jointly should not be a • joint property owned Apply in Form-31 through by other than the Employer spouse Addition/alteration of house Maximum Proof/ documents Purpose Eligibility Admissible Type of Advance required ** Amount Under Para 68-B(7) of the Addition/alteration • Should complete 12 times of Certificates of proof 5 Years after of house Scheme Wages construction (same type of Apply in Form-31 Annexure III • (construction / advance can be through the Employer completion certificate/ availed for repair of utilisation certificate) Only Once should be submitted house) Only once in • service property should • be in the name of self Apply in Form-31
  8. 8. Benefits to Members under EPF Schemes or spouse or jointly should not be a • joint property owned by other than spouse Repair of house Maximum Proof/ documents Purpose Eligibility Admissible Type of Advance required Amount** Repair of Under Para 68-B(7) of the Should complete 12 times of Certificates of proof • 10 Years after house Scheme Wages construction (same type of Apply in Form-31 through Annexure XIII • (construction advance can the Employer completion certificate) be availed for should be submitted Only once Only once in • alteration of service house) property should • be in the name of self or spouse or jointly should not be a • joint property owned by other than spouse Lockout or closure of the establishments Maximum Proof/ documents Purpose Eligibility Admissible Type of Advance required Amount** Lockout or Under Para 68-H of the equivalent to Declaration No minimum • service closure of the Scheme the total of should be • establishment wages Apply in Form-31 closed for more than 15 days multiplied by Wages for • no. of months atleast 2 months is Whenever need arises not paid closed Balance should • be there in Employee's share. If closed for more than 6 months, advance
  9. 9. Benefits to Members under EPF Schemes can be allowed from Employer's share also Withdrawal prior to retirement Maximum Purpose Eligibility Admissible Proof/ documents required Type of Advance Amount** Withdrawal Under Para 68-NN of the 90% of total Certificate from the employer No minimum • service prior to Scheme of both showing the date of atleast 54 • retirement shares retirement years of age Only once Apply in Form-31 1 year before • retirement Other Advances 68L : ADVANCE IN ABNORMAL CONDITIONS Types of Benefit Eligibility Eligible Amount Form Documentary Support Grant of advance in abnormal · Certificate of Rs. 5000/- or 50% of No.31 Certificate from the conditions, Natural calamities etc. damage from member’s own share Appropriate Authority. appropriate of contribution (To authority. apply within 4 months) · State Govt. declaration. 68 M : ADVANCE TO MEMBER AFFECTED BY CUT IN THE SUPPLY OF ELECTRICITY Eligible Types of Benefit Eligibility Form Documentary Support Amount Grant of advance to The advance may be granted Wages for No.31 Certificate from State Govt. members affected by cut only to a member whose total a month regarding cut in the supply of in the supply of electricity wages for any one month OR electricity.
  10. 10. Benefits to Members under EPF Schemes commencing from the month of Rs.300/- January 1973 were 3/4th or less than 3/4th of wages for a month 68 N : GRANT OF ADVANCE TO MEMBERS WHO ARE PHYSICALLY HANDICAPPED Eligible Types of Benefit Eligibility Form Documentary Support Amount To Physically Handicapped Production of Basic wages+ No.31 Certificate from the Medical member for purchase of an medical certificate DA for six practitioner to the effect that the equipment required to minimize from a competent months member is physically the hardship on account of medical practitioner or own share of handicapped.. handicap. to the effect that he contribution with is physically interest or cost handicapped of equipment which ever is least. **Notes The amount of advance/withdrawal is not required to be refunded under normal • circumstances. If the amount is not utilised, the same should be refunded with penal interest A fixed minimum balance in the account will be kept before arriving at the amount of • advance admissible subject to the above conditions For calculation/ computing the period of membership U/P 68B, 68BB, 68K, total • service exclusive of periods of break under the same employer before the scheme is applied to him, as well as period of membership of the fund is always included
  11. 11. Benefits to Members under EPF Schemes Frequently Asked Questions • 1) Who will be covered by the Pension Scheme? Every member of the ceased Family Pension Scheme 1971 and anyone who joins any covered establishment on or after 16-11-95 is compulsory to join this scheme, provided his/her salary/wage is less than Rs. 6500/- per month at the date of appointment. 2) what is a covered establishment? Covered establishment is an establishment belonging to the class of industries / other establishments, which have been listed in the schedule appended to the Employees' Provident Fund and Miscellaneous Provisions Act 1952 and where 20 or more persons are employed. 3) An employee was a Family Pension Scheme member. He/She has left on 13-12-93 and he/she is 54 yrs. old. He/She has taken his withdrawal benefit. Can he/she join the new scheme now? Yes, by refunding the withdrawal benefit together with interest. Thereafter, he/she will be entitled to receive pension from age 58, if he/she completes atleast 10 yrs. of contributory service by then. 4) If employee is a Family Pension Scheme Member and he/she has retired after 58 yrs. of age on 15-01-94 . Can he/she join will get pension under the new scheme? Yes, anyone who has retired by reaching age 58 between 01-04-93 and 15-11-95 may join the scheme by returning the withdrawal benefit along with interest. He will be paid pension with immediate effect, from date of exit provided he has rendered 10 yrs. of eligible service. 5) If employee is not a Family Pension Scheme member and he/she is 56 yrs. of age. Can he/she join Family Pension? Yes, by diverting from his/her Provident Fund balance, Family Pension Scheme contribution from date of his/her joining or 01-03-71 , whichever is later. 6) Whether the Family Pension Scheme member who has attained the age of 58 yrs. before 01-04-93 and has left employment after 01-04-93 will be admitted to the scheme as member of Family Pension Scheme, 1995?
  12. 12. Benefits to Members under EPF Schemes Yes, he will be deemed to have retired after 01-04-93 . On repayment of that withdrawal benefit if paid along with the interest, Pension will be paid from the same date, provided he has rendered 10 yrs. of eligible service. 7) In case Family Pension member has attained the age of 58 yrs. between 01-04-93 and 16-11-95 then in that case whether arrears of monthly Member Pension become payable for the period earlier than 16-11-95 i.e. from the date of his/her attaining the age of 58 yrs. which is prior to 16-11-95? No, he/she will be deemed to have retired from 16-11-95 and pension paid accordingly. 8) Is employee the only beneficiary of Fund? Benefit will be paid to him/her and in his/her absence to his/her family. 9) What is meant by Family? Family means employees' spouse and children below 25 yrs. of age. 10) Suppose employee does not have a Family and he/she dies before receiving benefit. Does his/her pension get lost? No, if he/she does not have a family, benefits will be paid to his/her nominee, who will receive the benefit in his/her absence. 11) Suppose member has not nominated anyone? The amount will be paid to dependant father or dependant mother as the case may be. 12) Can member change his/her nomination? He/She can change his/her nomination whenever he/she decide within the framework of rules for such nomination. In other words if he/she has a family, nomination should be in favour of a member(s) of the family. If he/she has no family he/she can nominate anyone he/she wishes 13) How many years service is required to be eligible to receive pension? Minimum 10 years eligible service will entitle for pension. 14) Employee is a member of Employees' Pension Scheme. He/She has left employment at 48 yrs. of age and 8 yrs. of service. When shall he/she receive his/her pension? He/She will not receive any pension.
  13. 13. Benefits to Members under EPF Schemes 15) What is past service pension? This pension is for the period under membership of the Employees' Family Pension Scheme, 1971, i.e upto 15.11.1995. 16) If employee is a member of Employees' Family Pension Scheme and he/she has left employment at 48 years of age with 12 years of service to his/her credit. When will he/she be eligible to receive pension? He/She will receive pension on reaching age of 58 years. 17) Can member not get pension earlier? Yes, he/she may receive pension on reaching age of 50 years. In that case pension payable from age of 50 years will be reduced by 3% for each year falling short of 58. 18) Member's pension has been worked out based on salary at age 48 and service upto 48. Will this pension remain same until he/she reach age 58? No, the pension will be increased on subsequent actuarial valuation along with vested percentage. 20) Past service pension is Rs. 170/- now. If employee retires after 10 years what will be his/her past service pension? His/her past service pension will be accumulated as per factor Table B. As such pension payable will be Rs.170 * 2.720 = 462.40. 20) Why are there two pension formulas? For the past service upto 15.11.95, there is a table to calculate the benefits. For actual service from 16.11.95 onwards there is a formula which is Pension formula is 1/70 * Pensionable Salary * Pensionable Service. From those rendering 20 years service, pensionable service is enhanced by two years. This is inline with concept that maximum pension should be paid to the longest service employee. 21) If employee has reached age of 50 years, what does he/she has to do to receive monthly pension? As and when he / she is quitting the employment, they can apply for reduced monthly pension. 22) Employee is a member of ESIC. On his disablement he will receive benefit from there as well. Will his benefit under Employees' Pension Scheme be affected by this? No, his benefit under the scheme is due to his contribution under The Employees' Pension Scheme '95. Accordingly the disablement pension will not be affected notwithstanding his availing benefit elsewhere.
  14. 14. Benefits to Members under EPF Schemes 23) Employee has left his employment on reaching age 45. He has deferred his pension till 58. He has become permanently disabled after 3 years from leaving service. Does he receive disablement pension? No, he will receive disablement pension from date of disablement only if such disablement occurs while in service. 24) In case of employee's death in service, what benefit will be available to his family? Widow will receive pension :- a) The pension as he would have received had he retired on the day of death or b) Such widow pension would have been payable under erstwhile Family Pension Scheme or c) Rs. 450/- per month whichever is highest. In addition 25% of widow pension with minimum of Rs. 150/- for each child (not exceeding two children at a time) will be paid until the youngest child reaches 25 years of age. 25) Employee has left covered establishment after 12 years in service and he has not taken withdrawal benefit. He has not reached age 58. In case he dies during deferment of pension what benefit will widow receive? Widow will receive pension:- a) Pension that he would have received had he retired on the day of death, or b) Family pension payable under erstwhile Family Pension Scheme, or c) Rs. 450/- per month whichever is the highest. 26) Employee has left service with 8 years of service. He has not taken refund of contribution. He has not reached age 58. If he dies during deferment what benefit will his widow receive? She will receive widow pension as prescribed and not the retirement pension. 27) Employee has made an Option-1 i.e. to receive 90% of original monthly pension. What capital return on his death? 100 times of original pension. 28) Employee has opted for Option-1 where his wife is nominee. Does his wife get widow pension after his death even though she will receive capital sum? Yes, she will get 50% of pension last drawn by him or Rs. 450 p.m. whichever is the highest in addition to payment of Return of Capital.
  15. 15. Benefits to Members under EPF Schemes 28) What is Commutation? It is the option to receive a capital sum today instead of receiving a monthly pension for rest of your life. 29) What is the rate of commutation? It is upto 1/3rd of the Original Pension. Suppose the original pension is Rs.600/-, the commutation value is Rs.20,000/-. On commutation, the pension payable will be Rs. 400/-. 30) When will commutation be effective? This will be effective from 16-11-98. 31) Employee is a member of The Employees' Pension Scheme. What are his duties? He should provide his employer with such details as would be required for the scheme purposes. He should submit his scheme certificate to his new employer if he changes his employment. 32) Anyone runs a covered establishment. What are his duties? a) Furnish particulars of ownership. b) He should obtain from each of his employees, pension scheme details in form 2 (R). He should send such details for all existing employees. In case of new employees, such details are to be sent within 3 months of date of enrollment. c) He should maintain in Form 3A / Form 7 (PS) such account in respect of contribution as required. d) Within 15 days of each month he will remit the contribution to the Pension Fund. If there is no employee he shall submit nil return in Form-12A / Form 6 (PS). Similar details about persons leaving the job if any in Form-10 / Form 5 (PS) should be submitted. Nil return may be furnished if no exit takes place. e) Obtain particulars for (a) to (d) from contractors engaged by him in respect of employees employed by them, and furnish it to Regional Provident Fund Commissioner in the manner prescribed. 33) Will the pension once sanctioned remain constant? No, this is likely to be increased consequent upon annual actuarial valuation.