Relief amidst corona-crisis, EPF contribution may increase, Approximately 20 Lakh employees will get benefits
Government may soon announce to give relief in the midst of Corona-crisis. Companies with 200 personnel will get relief under the new scheme. 15,000 or less monthly salary workers will be benefited.
In the midst of the crisis created by the Covid-19 crisis, the government can expand the scope of EPF contribution to include companies that have 200 employees. Under this, the government can pay EPF contribution of 24% of the share of both the employee and the employer for three months. This will benefit about 20 lakh small workers whose monthly salary is Rs 15,000 or less.A senior official associated with the matter said that the central government has received a proposal in this regard.
If implemented, it would be an extension of the scheme under which companies with a maximum of 100 employees are currently relieved, in which 90 percent of the employees have a salary of Rs 15,000 or less. It is benefiting 11 lakh employees. He said that to deal with the Corona crisis.The government is preparing to give another economic package, in which an announcement can be made about this plan as well.
Two options are being discussed.Generally, EPF accounts for 24% of the basic salary of the employees. Employees contribute 12% of this and the rest 12% is the company. According to the official, the government is assessing the additional financial impact taking into account two conditions. First – limit the number of employees. Secondly, the number of employees with a salary of 15,000 or less should be reduced from 90% to 60%. A decision will be taken on the basis of this.
Indeed, the biggest impact of lockdown has been on micro, small and medium enterprises. To give relief to them, the government had earlier implemented this scheme in the stimulus package. Now the government is under pressure to increase the limit of employees from 100 to 200 to provide this relief to all establishments. It is believed that doing so may help in retrenchment of employees and prevent pay cuts.
Relief was announced in the first package. On March 26, Finance Minister, Nirmala Sitharaman, announced an incentive package of Rs 1.7 lakh crore to tackle the Covid-19 epidemic. It also said that the government will own the entire EPF contribution of those earning less than Rs 15,000 monthly in companies with 100 employees, in which 90% of the salary is less than Rs 15,000. This step was taken for three months, which was estimated to cost a total of Rs 4,800 crore.
