Retirement fund body EPFO implements SC order, gives option for higher pension to eligible subscribers

Retirement fund body EPFO has asked its field offices to provide an option for higher pension to eligible subscribers in accordance with the Supreme Court order on November 4, 2022.

According to the Employees Provident Fund Organisation (EPFO) circular on December 29, 2022 the central government has directed to implement the directions in the Supreme Court order.

The field offices have been directed to implement "the directions contained in para 44 (ix) of the Supreme Court judgement on November 4, 2022" within stipulated timeline and to ensure adequate publicity of the decision taken by the EPFO to implement the said directions, the circular said.

Earlier in November 2022, the Supreme Court had upheld Employees Pension (Amendment) Scheme 2014.

The EPS amendment of August 22, 2014 had raised the pensionable salary cap to Rs 15,000 a month from Rs 6,500 a month, and allowed members along with their employers to contribute 8.33 per cent on their actual salaries (if it exceeded the cap) towards the EPS.

Also Read | Want to retire early? 5 strategies to know ahead of the new year

It gave all EPS members, as on September 1, 2014, six months to opt for the amended scheme.

The apex court in its order gave four more months to eligible subscribers to opt for higher pension under EPS-95.

The court had also struck down the requirement in the 2014 amendments mandating employee contribution of 1.16 per cent of the salary exceeding Rs 15,000 per month. This will facilitate the subscribers to contribute higher to the scheme and get enhanced benefits accordingly.

The EPFO circular also provides for the higher pension option for those eligible subscribers who either contributed on actual wages higher than Rs 5,000 or Rs 6,500 per month prevalent threshold pensionable salary or exercised their option for higher pension or their request for higher pension was declined by EPFO authorities before the amendment to EPS-95 in 2014.

The eligible subscribers would have to apply jointly with their employer for the enhanced benefit in the application form prescribed by the Commissioner and all other required documents like joint declaration etc.