Sometimes, even a small mistake by companies can have a significant impact on your retirement funds, but there’s no need to worry now. The Employees’ Provident Fund Organization (EPFO) has issued a revolutionary new circular that will put an end to all your worries. If your company has inadvertently deposited the wrong amount into your pension fund (EPS) or you have been denied a pension scheme despite being eligible, the EPFO will now automatically correct these mistakes with steely precision. The biggest advantage of this new rule is that the employee will not suffer even a single rupee of financial loss during any correction process. Let’s understand this new EPFO guideline in detail.
EPFO’s Eye on These 2 Major Mistakes
EPFO has acknowledged that companies often make two serious mistakes due to data entry or technical reasons. The first mistake is that money was deposited into the EPS accounts of employees who were not eligible for the pension scheme. Another major error was that employees who were eligible for a pension were mistakenly transferred to a PF account instead of the EPS account. These errors caused significant difficulties in claiming their pension at the time of retirement.
What happens if money is incorrectly deposited
Suppose you were not eligible for the EPS, but your company deposited your share there. In such a situation, the EPFO will take strict measures:
The department will fully calculate the incorrect amount.
The money will be withdrawn from the EPS account, the full interest due will be added, and deposited into your correct PF account.
The incorrect ‘pension service period’ will be removed from your records to avoid any technical difficulties when receiving retirement benefits in the future.
Employees’ pension money remains safe
This problem is quite common where an employee is eligible for a pension, but their entire money remains deposited in the PF account. EPFO has made concrete arrangements for this as well. The department will calculate the correct pension contribution and deduct the amount from the PF account and transfer it, along with interest, to the EPS account. In addition, the employee’s pension service period will be added to the correct date in their records. If there was a period of non-contributory contribution, it will be corrected as per the rules.
Will subscribers suffer any financial loss
EPFO has clearly stated in its circular that subscribers will not suffer a single penny loss due to these adjustments. Every transaction will be processed with interest, ensuring the safety of your total deposit.