EPF cover wage limit to be raised from Rs 15,000 to Rs 21,000
The government is set to raise the monthly wage ceiling for mandatory Employees’ State Insurance (ESI) cover to Rs 21,000 from Rs 15,000 at present.
The government pays 1.16% of the wages to each subscriber earning less than Rs 15,000 a month towards EPS . At Present the current rule it that, the mandatory for units employing 20 or more people to provide EPF benefits to workers. At Currently we are in the system of contribute employees Salary about 12% of the basic pay to EPF, the employer contributes 8.33% of the pay (up to Rs 15,000) towards EPS and 3.67% of the pay to EPF. Employers also pay 0.5% towards employee deposit linked scheme (EDLI), 0.65% as EPF administrative charges and 0.01% as EDLI handling fee. Though the threshold exists for mandatory cover, employers and workers can opt for the scheme even if the salary levels are higher.
Following this, the labour ministry sent the proposal to the finance ministry for its approval which would require to be notified by the government subsequently. Since inception, EPFO has raised the wage threshold for nine times with the last revision in November 2014 from Rs 6,500 a month. The wage threshold for medical/cash and insurance benefits under the Employees’ State Insurance Corporation (ESIC) was also raised last year to Rs 21,000 per month, from 15,000 previously.
ESIC, another social security venture of the government, had in September last year raised the threshold to `21,000 per insured persons in sync with the hike in minimum wages. In ESIC, the employer contributes 4.75% of the wages and the employee 1.75% The labour ministry has proposed that provident fund, pension and insurance benefits currently being accorded to a section of organised-sector workers be extended to the entire working population under a comprehensive social security net. India has an around 49 crore working population.