Tel. HC: Constitutional Validity of Section 38(2) of RP Act and Rule 5.7.1 of ECI’s Handbook Upheld  ||  MP HC: Power Exercised u/s 319 of CrPC Must Come Before Acquittal Order in Case of Joint Result  ||  Del. HC: Order of CIC Directing CBDT to Give Information Regarding Ram Janmabhoomi Trust Set Aside  ||  Ker HC: In Non-Performance of Agreement, Buyer to Get Charge Over Property For Paying Purchase Price  ||  Rajasthan High Court: Reinstate Ayurvedic Doctors Who Haven’t Attained 62 Years of Age  ||  Rajasthan High Court: Accrual Time For Taxing Income to Be Postponed Till Dispute’s Adjudication  ||  Supreme Court: Distributor Not An Agent But An Independent Contractor  ||  Ker. HC: No Member of Hindu Public Can Claim to Perform Services That Only Archakas Can Perform  ||  Bom HC: Emp. to Ensure That Minor Mistakes Due to Candidate’s Disability Shouldn’t Lead to Job Loss  ||  SC Criticises Centre For Not Specifying Range of Rates For Treatment in Pvt. Hospitals & Clinics    

Lower rate of EPF subscription 10% with EPFO notified placing higher liquidity in the hands of employees and employers during COVID-19 pandemic- (Press Information Bureau) (19 May 2020)

MANU/PIBU/1340/2020

Service

Government Sector, their PSEs and establishment whose subscription is being borne by Union Government under PMGKY continue to have subscription at old rates of 12%. Lower rates to be applicable for salary months of May, June and July 2020.

Various measures have been announced from time to time to provide relief to the employers and employees of the establishments covered under the EPF & MP Act, 1952 distressed by Lockdown to prevent spread of COVID-19 and other disruptions due to Pandemic.

The reduction in statutory rate of contributions from 12% to 10% for wage months May, 2020, June, 2020 and July, 2020 for all class of establishments covered under the EPF & MP Act, 1952 announced on 13.05.2020 by the Central Govt. as part of Atma-Nirbhar Bharat package has been notified vide SO 1513 (E) dated 18.05.2020 published in the Gazette of India. The notification is available under the TAB- COVID-19 on the home page of EPFO website.

The above reduction of rate of contribution is not applicable to establishments like Central and State Public Sector enterprises or any other establishment owned or controlled by or under control of the Central Govt. or State Govt. These establishments shall continue to contribute 12% of basic wages and dearness allowances.

The reduced rate is also not applicable for PMGKY beneficiaries, since the entire employees EPF contributions (12% of wages) and employers' EPF & EPS contribution (12% of wages), totaling 24% of the monthly wages is being contributed by the Central Govt. Reduction in rate of EPF contributions from 12% to 10% of basic wages and Dearness allowances is intended to benefit both 4.3 Crore employees/members and employers of 6.5 lakhs establishments to tide over the immediate liquidity crisis to some extent.

As a result of reduction in statutory rate of contributions from 12% to 10%, the employee shall have a higher take home pay due to reduction in deduction from his pay on account of EPF contributions and employer shall also have his liability reduced by 2% of wages of his employees. If Rs.10000/- is monthly EPF wages, only Rs.1000/- instead of Rs.1200/- is deducted from employee's wages and employer pays Rs.1000/- instead of Rs.1200/- towards EPF contributions.

In Cost to Company (CTC) model, if Rs.10000/- is monthly EPF wages, in CTC Model the employee gets Rs.200/- more directly from employer as employer's EPF/EPS contribution is reduced and Rs.200/- less is deducted from his/her wages. Under the EPF Scheme, 1952 any member has the option to contribute at a rate higher than statutory rate (10%) and employer can restrict his contributions 10% (statutory rate) in respect of such employee.

Tags : EPF SUBSCRIPTION   RATES   LIQUIDITY  

Share :        

Disclaimer | Copyright 2024 - All Rights Reserved