The deadline for applying for a higher pension with the Employees Provident Fund Organisation (EPFO) is approaching on 26 June 2023. However, there is still a lack of clarity on various issues surrounding the process. These include how payment and calculation will be done, how discrepancies between wage records maintained at the EPFO level and those maintained at the employer level will be resolved, and what would happen if one of the employers is no longer in existence or has merged. Experts believe that due to this confusion, the deadline may be extended again, although the chances are low as it has already been extended twice.
“The EPFO is expected to provide additional guidance on how the higher pension will be calculated. However, there are concerns about how transfers from the EPF account to the EPS account will be carried out and how discrepancies in wage records will be resolved. The status of employers who no longer exist or have merged also remains uncertain. These unresolved questions contribute to the uncertainty surrounding the application process,” said Amit Gupta,MD, SAG Infotech
Experts suggest that the lack of clarity regarding payment and calculations for those who have retired may lead to a further extension of the deadline.
However, considering that the deadline has already been extended twice, the EPFO may be reluctant to grant another extension, added Gupta.
Furthermore, the multiple circulars issued by the EPFO and the need to track each application after scrutiny adds to the compliance burden for both employees and employers.
According to Gupta, the EPFO has been issuing clarificatory circulars, but there is no comprehensive circular that clearly outlines the entire process, making it challenging for employees to understand what happens after filing an application.
Amit Gupta of SAG Infotech said that overall, the lack of clarity, compliance burden, and slow progress in processing applications have raised concerns about the EPFO‘s ability to meet the deadline for applying for a higher pension.
The Supreme Court’s November 2022 order allowed employees who were part of the EPF before or on September 1, 2014, but could not apply for a higher pension, to submit fresh options within four months. The deadline was initially extended until May 3, 2023, and then further extended to June 26, 2023.
Meanwhile, the retirement fund body EPFO added 17.20 lakh members on a net basis in April this year, according to payroll data released. “Out of 17.20 lakh members added during the month, around 8.47 lakh new members have come under social security coverage of the Employees’ Provident Fund Organisation (EPFO) for the first time,” a labour ministry statement said.
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Updated: 22 Jun 2023, 12:52 PM IST