Higher Pension Scheme: The last date to apply for higher pension has been increased from 3 May 2023 to 26 June. Meanwhile, now the Ministry of Labor and Employment has made it clear that it will get an additional contribution of 1.16% out of the total 12% contribution of employers to the Provident Fund while calculating pension on higher salary.
The Supreme Court had ruled in November 2022 that those who were members of the Employees’ Provident Fund Organization (EPFO) as on September 1, 2014, can opt for higher pension.
Issuing a statement, the ministry said that this step will reduce the burden of the employees subscribing to the Employees’ Pension Scheme. The Labor Ministry further said that the employees’ contribution to the Pension Fund is not envisaged in the spirit of the Employees’ Provident Fund and Miscellaneous Provisions Act as well as in the Social Security Code. The Ministry said that keeping in view the EPF & MP Act and the Code, it has been decided to take an additional contribution of 1.16% within the total 12% of the employers’ contribution to the Provident Fund.
Court’s instructions
As per the Supreme Court order, employees drawing salary above Rs 15000 can opt to contribute more than 1.16%. The court directed the officials under the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952 to make necessary adjustments in the scheme within a period of six months.
The ministry said that all aspects of the matter, including legal and administrative, were examined in detail for implementing this direction. Thereafter, it was decided that since the Code on Social Security, 2020 (the Code) has already been notified, it would be appropriate to bring relevant provisions.
In the notification, the Labor Ministry said that it has taken all actions immediately within the prescribed time limit to comply with the directions of the Supreme Court. Which also includes extending the deadline till June 26 to allow beneficiaries to file for higher pension.
