On Thursday, Union Minister of Youth Affairs and Sports and Labour and Employment, Mansukh Mandaviya, elaborated on the considerable relaxations in the Employees’ Provident Fund Organisation (EPFO) rules.
These relaxations are intended to facilitate the EPF withdrawal process to enhance social security of employees, ANI reported, quoting the minister.
What’s new?
The primary relaxations focus on assisting employees following loss of employment. Many employees prefer to access their savings without harming their service record.
Employees may now withdraw 75 percent of their EPF savings following a loss of employment and the remaining 25 percent of the EPF savings one year afterwards. This entitlement maintains the employee’s service for 10 years and secures eligibility for a pension benefit, social and financial security.
EPF Withdrawal Made Easier
“EPF withdrawal has been made simpler now. If someone loses their job, 75% of the amount can be withdrawn immediately, and after one year, the full amount can be withdrawn. The 25% retention for one year ensures that the 10-year service tenure is not broken. With these reforms, the employee’s service continuity is maintained, and receiving a pension will provide social and financial security,” Mandaviya told ANI.
Extended Withdrawal Window and New Steps
The government has also extended the period for fund withdrawal after job loss from two months to one year. This gives members more time to find a new job and maintain job continuity.
To increase enrolment in EPFO, the government now allows establishments that did not contribute earlier to register by paying a small penalty. This helps more employees get social security benefits.
For elderly and remote beneficiaries, the government has partnered with postal services. A Memorandum of Understanding (MoU) will allow life certificates to be issued and verified at home. This means beneficiaries do not need to visit EPFO offices and can receive their benefits easily, ANI reported.