pf 13.02.13
TRANSCRIPT
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THE ACT IS A SOCIAL WELFARE
LEGISLATION
To provide for the institution of Provident Funds,
Pension Fund and Deposit Linked Insurance Fund.
Besides a monthly stream of income, the EPF subscription
entitles the member of the Fund to an insurance cover on his life
through the Employees Deposit Linked Insurance Scheme.
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Objective:
This act is a social security legislation which provides
three schemes i.e..
1. Family Pension (Family Pension Fund Scheme)
2. Provident Fund (Provident Fund Scheme)
3. Insurance to Employees (Employees Deposit Linked
Insurance Scheme).
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WAGE COMPONENTS OF PF
1. BASIC PAY
2. DEARNESS ALLOWANCE (on acc of rise in cost of
living)
3. CASH VALUE OF FOOD CONCESSION
4. RETAINING ALLOWANCE
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EMOLUMENTS EARNED BY THE
EMPLOYEE
While on duty
On leave with wages
Not on leave encashment
Not on House rent allowance
Not on Bonus
Not on OT
Not on any presents made by the employer
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The Act applies to Every establishment in which 20 or more are
employed.
Apprentices are not covered under the EPF Act.
Contributions Details
Employers Share 12%of Basic which is deposited in EPFaccount
Employees share 12% on Basic Of this 8.33% on max of6,500 (Basic) goes to Pension Fund
Rest of 3.67 % goes to EPF Account
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Description of
the Head
Head of
Accounts
Employees
Contribution
Employers
Contribution
Remarks
EPF A/c No: 1 12% 3.67%
FP A/c No: 10 8.33% Wage Ceiling
is Rs.6500/-
Admin. Charges A/c No: 2 1.10%
EDLI A/c No: 21 0.50%
EDLI Admn
Charges
A/c No: 22 0.01%
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If Basic is 5,000 FPF = 417EPF = 783(600+183)
If Basic is 8,000 FPF = 541EPF = 1379(960+419)
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CIRCUMSTANCES IN WHICH ACCMULATIONS
ARE PAYABLE BY WAY OF FINAL SETTLEMENT
1. On retirement from service after 55 years
2. Retirement due to permanent total disablement incapable for
work
3. Migration from India for permanent settlement abroad
4. Termination due to mass or individual retrenchment
5. On Voluntary retirement scheme
6. Termination of job and upon joining an establishment not
covered by PF
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Purpose Completed
Years
Maximum Amount
of loan
Other
Conditions
Marriage of self, son,
daughter, brother,
sister / Education of
self, son, daughter
7 years 50 % of employees
share
3 times in
service
Medical treatment ofself or family
No minimumservice
condition
Lesser of 6 times ofmonthly wages or
full employee share
For specifiedillnesses
Construction or
purchase of house /
Repayment of housingloan
5 years 36 times of monthly
wages
Only once in
service
Purchase of site/plot 5 years 24 times of monthly
wages
Only once in
service
Addition/alteration oh
house/Repair of house
5 Years/10
years afterconstruction
12 times of monthly
wages
Only once in
service
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Purpose Completed
Years
Maximum
Amount of loan
Other
Conditions
Lockout or
closure ofestablishment
No minimum
servicecondition
Monthly wages
multiplied bymonths closed
When wages for
atleast 2months not paid
Withdrawal
prior to
retirement
No minimum
service
condition
90% of total
employee and
employer
shares
Only once in
service, at least
54 years of age,
1 year before
retirement
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Spouse
And Children
Father and mother are dependants only
FAMILY MEANS
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EDLI
For this, organization contributes 0.5% of monthly Basic Pay,
capped at Rs 6500, as premium.
Payment is linked to the balance in his PF Account.
According to the latest rules, the members cover amount is
higher of the two 20 times the average wages of the past 12 months
(Upto 6,500 per month), i.e Rs 1,30,000
Or the full amount in his PF account upto 50,000 + 40% of the
balance amount.
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EMPLOYEES PENSION SCHEME 1995
Came into effect from 16th November 1995
To provide old age and post service support to workers
On Contributory basis8.33% on employer share restricted
to 6,500 Basic + DA
Earlier it was Family Pension Scheme 1971
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EMPLOYEES PENSION SCHEME 1995
I For Member
Pension Payment for life on Retirement / Superannuation
Pension Payment for life on invalidation during
employmentCapital return on option formula basis upon cessation of
members pension payment
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EMPLOYEES PENSION SCHEME 1995
I To Family Members upon Death of the Member
1. To Spouse for life or until remarriage.
2. To children (two at a time) till they attain the age of
25 years additionally along with pension to
spouse.
- For total and permanently disabled childrenpension for life
3. Orphan Pension to children at higher rate upon
cessation of Pension Payment to Spouse.
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OPTION REDUCED PENSION RETURN OF CAPITAL
Revised pension during
life time pensioner withreturn of capital on his
death
90% of original
monthly pension
100 times of original
monthly pension on deathof member to the nominee
Revised pension during
members life reduced
pension during widows
lifetime and then returnof capital to nominee
90% of original
monthly pension to the
member. On his death
80% of the originalmonthly pension to the
widow
90 times of original
monthly pension on death
of widow/remarriage to the
nominee
Pension for fixed period
of 20 years not
withstanding whetherthe member lives for
that
87.5% of the original
monthly pension for a
fixed period of 20years. The pension will
cease thereafter
100 times of original
monthly pension at the end
of 20 years from the date ofcommencement of pension
to the member if he is alive,
otherwise to his nominee