EPFO introduced following facilities during Lockdown period:-
1) Pandemic Advance Facility for Employees’.
2) Pradhan Mantri Garib Kalyan Yojna (PMGKY). (For both Employer and Employees).
3) EPF Statutory rate reduced from 12% to 10% for the wage month of May 2020, June 2020 & July 2020. (For both Employer and Employees).
Due to COVID-19 Global Pandemic & Lockdown, EPFO Introduced Several Pandemic Period Facility for Employees as well as for Employers.
The Hon’ble Prime Minister of India, due to Covid-19 Global Pandemic announced Lockdown from 25th March, 2020 to 14th April 2020, later the Lockdown extended till 03rd May 2020, Now same is extended till 17th May 2020, further extended from 18th May 2020.
EPFO Introduced ‘Pandemic advance facility’ for employees’
The Central Govt. vide notification dated 27th March, 2020 introduced EPF non-refundable advance from the PF Account of Member. PF Member can get non-refundable advance, not exceeding the basic wages and dearness allowances of that member for three months or up to seventy five percent of the amount standing to his credit in the Fund, whichever is less.
This will benefit all the workers registered with EPFO. i.e. (Total of Basic + DA for 3 Months) or (75% amount standing in PF Fund) whichever is less, will get to the Member as Covid-19 Advance.
1) Calculation for ‘Pandemic advance facility for Employees” :
If the Total balance in member’s PF account as on date is ₹ 50,000/- and his monthly Basic wage and Dearness allowance is ₹ 15,000/-
Therefore ₹ 15,000/- (Basic + DA) X 3 Months =45,000/-
75% of balance of ₹ 50,000/- is ₹ 37,500/-
Then the Member is eligible to get Advance of ₹ 37,500/- which is least of two amounts.
2) Calculation for ‘Pandemic advance facility for Employees” :
If the Total balance in member’s PF account as on date is ₹ 50,000/- and his monthly Basic wage and Dearness allowance is ₹ 15,000/-
Therefore ₹ 15,000/- (Basic + DA) X 3 Months =45,000/-
75% of balance of ₹ 50000/- is ₹ 37,500/-
Then the Member is eligible to get Advance of ₹ 37,500/- which is least of two amounts.
Eligibility to file online Advance claim under Covid -19
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UAN should be activated.
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Verified AADHAR should be linked with UAN.
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Bank Account with IFSC should be seeded with UAN.
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Mobile number should be seeded with UAN.
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Mobile number should be linked with your AADHAR for final submission of online claim.
Note: Fill online Form 31
Pradhan Mantri Garib Kalyan Yojana
The Govt. of India on 26.03.2020 announced ₹ 1.70 Lakh Crore relief package under Pradhan Mantri Garib Kalyan Yojana (PMGKY) for the poor to help them fight the battle against Corona Virus Pandemic.
As part of the said package, the Central Govt. proposes to pay 24 percent of the monthly wages into EPF accounts for three months of Wage-earners below Rupees fifteen thousand per month, who are employed in establishments having up to one hundred employees, with 90% or more of such employees earning monthly wages less than ₹ 15000/-.
A Scheme to be implemented by the Govt. of India – PMGKY package for credit of Employee’s & Employer’s share of PF contributions (EE 12% + ER 12 = Total 24% of wages) for March, 2020, April, 2020 and May, 2020.
Overview of the Scheme:
The Govt. of India on 26.03.2020 relief package under Pradhan Mantri Garib Kalyan Yojana (PMGKY) proposes to pay 24 % by Central Government, of the monthly wages into EPF accounts for next three months of Wage-earners below Rupees 15,000/- per month, who are employed in establishments having up to one hundred employees, with 90% or more of such employees earning monthly wages less than ₹ 15000/-.
Validity of Scheme:
The Scheme will be in operation for the wage months- March, 2020, April, 2020 and May 2020. Further the said scheme has been extended from June 2020, July 2020, & August 2020. (Three Months)
Main Objectives of PMGKY Scheme:
➣ To help and support establishments employing up to 100 employees, with 90% or more of such employees earning less than ₹ 15,000/-monthly wages.
➣ the employees contributions (12% of wages) and employers’ contribution (12% of wages), totalling 24% of the monthly wages for the next three months shall be paid by the Central Govt. in the EPF accounts of employees, who are already members of EPF Scheme, 1952, drawing wages less than ₹ 15,000/- per month and in establishments, already covered under the EPF & MP Act, 1952.
Benefit for Employers :
➣ The employers entitle under the said scheme will the benefit of PKGKY
➣ The financial burden will be reduced to the entitled employers as the 12% employers contribution shall be paid by the Central Government.
➣ Will help to stable the employees strength in the establishment.
Benefit for Employees :
➣ As the Employees 12% PF Contribution shall be paid by the Central Government, the employees will get some extra amount in hand, as the Employer will not deduct the 12% PF Contribution from the salary of employee.
➣ No loss of employment.
➣ It is clarified that if any employee is already a registered beneficiary and his/her employer is availing benefits of payment of employer’s share by Central Govt. under PMRPY/PMPRPY 2016, no such benefit in r/o such employee shall be available under Scheme of PMGKY.
Finance Minister Nirmala Sitharaman in her press conference informed about the measures to be taken for the benefit of the members of Employees Provident Fund (EPF). Those earning a basic salary of more than ₹ 15,000 a month will now contribute 10 per cent instead of the mandatory 12 per cent contribution towards the PF for the next 3 months till August 2020. Also, the contribution of the employer will be reduced to 10 per cent from 12 per cent. However, for the Central government employees, the rate of contribution by the employer remains the same.
Procedure to receive reimbursement of benefits under Pradhan Mantri Garib Kalyan
Reimbursement under PMGKY for Establishments which had remitted for March, 2020 before deployment of facility of PMGKY on PF Portal. Employer need to login in on EPF Portal and has to fill under tab of “PMGKY Reimbursement Registration”. Then Employer need to update Form-5A with e-sign or DSC and has to fill the bank details from which the March 2020 due paid, & then has to submit the claim for PMGKY reimbursement.
EPF Statutory Contribution Rates @10% for the Wage Month of May 2020, June 2020 & July 2020
The statutory rate of contribution will be 10% for wage month of May 2020, June 2020 & July 2020.
Revised rate of EPF Contribution announced by the Central Government, Under Atmanirbhar Bharat Package, vide notification dated 18th May, 2020. The Statutory rate of PF Contribution for Employer and Employees has been reduced to 10% (on Basic +DA) from existing rate of 12% for all class of covered establishments under EPF & MP Act 1952, except the establishments like Central and State Public Sector Enterprises or any other establishment owned or controlled by or under control of the Central Government or State Government.
This reduced rate of statutory PF will help to overcome the immediate liquidity crisis to some extent during pandemic situation. The reduction in statutory rate of contributions from 12% to 10%, the employee shall have a higher take home pay due to this 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.
Rate is also not applicable to establishments eligible for Pradhan Mantri Garib Kalyan Yojna (PMGKY) benefits, since the entire employees PF contribution @12% & Employers PF Contribution @ 12% both totalling to 24% of the monthly wages is being contributed by the Central Government. But the establishment availing benefit of Pradhan Mantri Rojgar Protsahan Yojana (PMRPY) can contribute at this reduced rate. Also, the reduced rate is applicable to exempted establishments. But, the establishment which are already paying at @10% are not eligible for any more reduction in rate of contribution.
If the establishment is not able to pay dues timely during the scheme period, then also such establishments is still eligible for reduced rate of contribution, irrespective of date of payment. There is no change in the EPF administrative charges and EDLI contributions both payable by employers.
Due date for payment of Provident Fund extended – due to Covid-19
➣ The due date for filling Electronic Challan cum Return (ECR) for wage month March 2020 is extended up to 15th May 2020 for employers who have paid wages to their employees for March 2020.
➣ Extended time limit is applicable to contributions and administrative charges due for the month of March, 2020.
➣ There would be no interest and penalty, if they remit on or before 15th May 2020. as per circular reference : F. No. C-1/Misc./2019-2020/Vol. II/Part/9, Dated 15th April, 2020
➣ EPFO has decided not to impose any penalty for delay in payment of employees’ provident fund contributions by firms during the nationwide lockdown. As per Circular dated 15 May 2020 Reference No.: C-I/Misc./2020-21/Vol.I/1112. Subject: Relief to establishments and factories covered under EPF and MP Act, 1952 from levy of penal damages for delay in deposit of dues during Lockdown to prevent COVID-19.