7th Pay Commission – Employees Provident Fund may be raised to Rs 25,000

7th Pay Commission – Employees Provident Fund may be raised to Rs 25,000

Under the 7th Pay Commission minimum wage ceiling the Employees Provident Fund (EPF) is likely to raise to Rs 25,000 from the existing Rs 15,000.

The proposal drafted by Employees’ Provident Fund Organisation (EPFO) will be sent to the Union Government which is likely to be approved, the report suggests.

The decision has been taken by the members of Sub-committee of the Central Board of Trustees, EPFO – the highest decision-making body – on contract workers held on November 7.

According to reports, the EPFO has proposed a hike in the wage limit of all employees drawing basic salary Rs 25,000 would have to contribute to the provident fund. However, those government employees drawing above that limit will have the option to become a member of the provident fund and can have an option to select or reject if they want to.

The move taken by the EPFO comes in the wake of changes in the wage structure in accordance with the proposal of the 7th Pay Commission. Most of the trade union representatives at the CBT sub-committee meeting noting that the minimum wage of the Central government employees after implementation of the 7th Pay Commission report has been hiked to Rs 18,000, due to which the EPFO’s wage ceiling of Rs 15,000 needs to be altered.

The CBT pointed out that there could be a further increase in minimum wages from Rs 18,000 is likely with the trade unions demanding minimum wage to be increased at least Rs 21,000 to Rs 22,000.

In fact, the Employees’ Deposit Linked Insurance Scheme (EDLI) is directly linked to the minimum wage ceiling. At present, If an employee is earning up to Rs 15,000 he or she can avail of benefits under the Employees Deposit Linked Insurance Scheme (EDLI). The scheme provides life insurance of up to Rs 6 lakhs.

Source: FE