The Employee’s Provident Fund Organization (EPFO) assists the Central Board of Trustees, which is a legislative body legalized under Employees Provident Fund and Miscellaneous Provisions Act, 1952. It is administratively managed and controlled by the Ministry of Labor and Employment, Government of India.
The organization assists the Central board for controlling and managing a mandatory contributing Provident fund scheme, Pension scheme, and Insurance scheme for the employees working private, public, and semi-government sectors of India. Thus, it is important to thoroughly know the EPFO scheme as it provides security to the employees and aims at establishing a liable payment system.
October 2014, Honorable Prime Minister of India, Narendra Modi announced UAN (Universal Account Number) for employees registered under EPFO. With the help of Universal Account Number, employees can now enjoy provident fund number portability.
EPFO has been coming with multiple initiatives for employee provident fund subscribers. As per the EPF scheme, both employee and employer has to give 12% of basic pay for EPF, out of which, employees contribute 12% of their salary that goes to EPF Kitty, while 8.33% of employer’s contribution is invested in EPS or pension scheme and the remaining 3.67% goes towards EPF. To know the EPF scheme better, check out the key benefits of the scheme for employees.
Entitles for pension as well
8.33% of the employer’s contribution goes straight to EPS (Employees Pension Scheme) for a maximum to Rs.541 and the remaining amount of the contribution is added to PF account. After retirement, upper pension limit is set to Rs.3500 per month.
According to Employee Deposit Linked Insurance scheme (EDLI), the organization is liable to pay 0.5% of the employee’s basic pay as a premium for the life insurance cover, with a subject of maximum Rs.6500.
For occasions like marriage, education, or financial crisis, employees can withdraw funds from their PF account, but, within a certain limit.