The UK Employees Provident Fund Organisation (EPFO) has issued around 22,000 pension payment orders for higher pensions under the Employees’ Pension Scheme, 1955. Union Minister of State for Labor and Employment Shobha Karandlaje informed the Lok Sabha about this development. Of the EPFO members, 1,748,768 applied for higher pensions under the EPS in 1995.
So far, 21,885 pension payment orders have been processed. This shows that many people have benefited from this initiative. The EPFO started the online application process following a Supreme Court order.
The deadline was initially set for February 26, 2023, but was later extended to July 11, 2023. Employers had to submit joint applications for higher pensions by September 30, 2023. This deadline has now been extended to May 31, 2024, and January 31, 2025.
The Employees’ Pension Scheme (EPS), established by the central government in 1955, is a social security scheme for employees who have worked for at least 10 years. The scheme provides financial support for people who reach the age of 58 or die untimely.
Contributions to the Pension Fund include 8.33% of the employee’s salary (up to Rs 15,000) from the Provident Fund. The central government contributes an additional 1.16%. After the Supreme Court’s decision in 2022, employees can now increase their contributions to this scheme based on their basic salary.
This can lead to higher pension benefits. Members who have applied for a higher pension can check the status of their applications on the EPFO website. The EPFO has announced that 21,885 Pension Payment Orders (PPO) have been issued to its members.
This allows them to receive higher pensions. Minister of State for Labour & Employment Shobha Karandlaje shared that 1.65 lakh eligible members have been asked to make additional deposits to qualify for increased benefits. Karandlaje informed Parliament that 17.48 lakh applications were received from EPFO members seeking higher pension benefits under the Employees’ Pension Scheme 1995 (EPS-95).
The government monitors the pending applications and has instructed EPFO field offices to speed up the administrative process. The Employees’ Pension Scheme (EPS) provides pensions to organized sector employees after they retire at the age of 58.
Epfo grants higher pension applications
Both employees and employers contribute to the scheme. Each contributes 12 percent of the employee’s basic pay and dearness allowance to the Employees’ Provident Fund (EPF), so the employee’s entire 12 percent contribution goes to the EPF.
The employer’s contribution is split, with 8.33 percent going to the EPS and the rest to the EPF monthly. Initially, the monthly pension cap under the EPS was Rs 5,000, based on the employer’s maximum 8.33 percent contribution. This cap was later raised to Rs 6,500 per month.
In 1996, the government allowed employees to contribute 8.33 percent of their salary. The EPFO provided a six-month window for employees to switch to this higher pension option. In 2014, amendments limited the higher pensionable wage to Rs 15,000 and removed the higher salary contribution option for those joining after September 1, 2014.
However, employees who joined the EPS before this date and opted for the higher pension before February 28, 2015, could continue contributing based on their actual salary. The 2014 amendments were criticized by EPS members, who were unaware of the joint option for higher salary-based pensions. As a result, their pensions were calculated at Rs 15,000 despite higher actual salary contributions.
The EPFO rejected many joint option applications, leading to member dissatisfaction. The issue was extensively litigated, with judgments from the Supreme Court, Kerala High Court, and Delhi High Court supporting the restoration of pension calculations based on actual salaries. In November 2022, the Supreme Court ruled that employees who were part of EPS before September 1, 2014, but were unaware of the joint option could exercise it by May 3, 2023.
This deadline was later extended to July 11, 2023. The EPFO’s current initiative to issue higher pension PPOs and expedite pending applications is a significant step towards aligning with these court rulings and addressing member concerns. To track your EPFO Higher Pension application status, visit the official EPFO portal and click on ‘Track application status for pension on higher wages.’
You can check it using three options: Acknowledgement number, UAN, or PPO Number. Fill in the captcha code, tick the consent box, and click ‘get OTP’. Your application status will be displayed on the screen.
The deadline for submitting joint applications for higher pensions has been extended multiple times. As a last chance, employers can forward applications for pensions on higher wages by January 31, 2025. For more information, visit the official EPFO website.
