A Supreme Court ruling over a year ago paved the way for higher payout under Employees Pension Scheme (EPS) 1995, which covers private sector and PSU workers, but only a handful have got the benefit as yet. The final orders for the pensioners to get higher benefits was passed around a month ago.
EPS comes under the Employees Provident Fund Organization (EPFO). A major part of employer’s contribution towards PF goes towards the pension fund.
The salary on which PF has to be paid has been capped at Rs15000 since 2014. Earlier, it was Rs6,500. Due to the upper limit, the pension too is restricted to around Rs7,500 in case of the salary being Rs15,000, and Rs3,250 for Rs6,500 salary.
In May 2017, the Supreme Court ruled in the case of RC Gupta and others vs Regional Provident Fund Commissioner that in contribution towards PF goes toward the pension fund.
The salary on which PF has to be paid has been capped at Rs 15000 since 2014. Earlier, it was Rs6,500. Due to the upper limit, a higher pension can be paid.
So far, surplus contribution went to the PF account. Now, according to the ruling, if the retired employee deposits the surplus amount with EPFO, a higher pension can begin. This can come to around half of the last drawn salary, depending upon the years of contribution.
Source: Times of India