The Ministry of Labour & Employment has carried out the choice to chop workers’ provident fund (EPF) contributions to 10 per cent from the present 12 per cent for 3 months until July. This might enhance four.three crore organised sector workers’ take residence pay and scale back the legal responsibility of 6.5 lakh workers reeling beneath liquidity crunch beneath lockdown to include COVID-19.
The choice is estimated to infuse liquidity of Rs 6,750 crore in subsequent three months. The labour ministry in a notification issued on Monday said that the discount in EPF contributions shall be relevant “in respect of wages payable by it for the months of Might, June and July, 2020”.
Subsequently the take residence pay due in June, July and August would enhance, whereas the employers’ contributions due in June, July and August would scale back. Giving motive for the transfer it said “whereas as a result of COVID-19 pandemic, lockdown is in drive throughout the nation and the Central Authorities after making crucial inquiry is happy that to offer liquidity within the palms of employers and workers, there arises a must amend the notification of April 9, 1997.”
Final week, Finance minister Nirmala Sitharaman had introduced discount of statutory provident fund contribution by each employers and workers for subsequent three months. The Central Public Sector Enterprises (CPSEs) and public sector undertakings (PSUs) will nonetheless proceed to contribute 12 per cent as employer contribution to the Workers’ Provident Fund Organisation (EPFO).
This discount of the EPF contributions will likely be relevant for employees who usually are not eligible for 24 per cent EPF help beneath PM Garib Kalyan Bundle and its extension. The federal government is contributing employers and workers contributions of 24 per cent of fundamental wages for these institutions which have as much as 100 worker and 90 per cent of whom earn beneath Rs 15,000 month-to-month wage since March.
Final week, Sitharaman had additionally introduced the extension of the profit beneath Pradhan Mantri Garib Kalyan Yojana (PMGKY) for 3 months, the place the federal government would contribute whole 24 per cent of EPF contributions until August, giving reduction to three.67 lakh employers and 72.22 lakh workers.
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