It will improve the obligatory contribution by each staff and employers, serving to employees save extra for his or her retirement. The rise will even carry extra employees below the EPFO’s social safety protection.
Presently, the wage ceiling for the EPFO’s Workers’ Provident Fund (EPF) scheme is ₹15,000 per thirty days, which was final revised in 2014 from ₹6,500 per thirty days. The scheme is obtainable solely to enterprises which have greater than 20 employees.
An skilled committee might be arrange shortly to find out the next wage ceiling, which might be listed to inflation and reviewed periodically for protection below EPFO, an individual conscious of the event advised ET.
In keeping with the individual quoted above, the EPFO wage ceiling might even be aligned with the upper ₹21,000 per thirty days wage ceiling below the Workers’ State Insurance coverage Company.
It will carry parity between the 2 social safety schemes of the federal government run by the labour ministry and ease the compliance burden on institutions.
The ceiling serves two functions. One, organised sector employees incomes lower than ₹15,000 a month need to compulsorily change into members of the EPF.