With an aim to provide more clarity on how to claim higher pension, the Employees’ Provident Fund Organisation (EPFO) on Wednesday released a circular on what all documents one can submit if one is not able to furnish a joint request under para 26(6) of EPF scheme.
The Supreme Court, in its November 2022 order, ruled that employees who were part of the EPF before or on September 1, 2014, but could not apply for higher pension, can now submit fresh options within four months, which later got extended up to May 3, 2023, and then June 26, 2023. However, the process for submitting joint application by the employees is extremely complicated, particularly a mandatory requirement in the form that required furnishing details of the option under para 26 (6) of the Scheme, 1952.
Read More: How To Extend Your Public Provident Fund Account After 15 Years
Clause 26(6) allows employees to jointly request with their employer to contribute a higher amount to the fund, exceeding Rs 15,000, to claim a higher pension. Given that the document was not available with most of the applicants, the Kerala High Court, while recognising the enabling nature of Clause 26(6), and the proximity of the cut-off date, directed the EPFO to make provisions in the online facility to furnish options without production of the document under Clause 26(6).
Given the situation, EPFO has on Wednesday released a list of documents that can be submitted if one is not able to furnish joint form under para 26(6).
The EPFO circular stated: Whereas a situation has arisen where joint request/ undertaking/ permission under Para 26(6) are not readily available with most of the applicants who have filed Applications for Validation of Option / Joint Options covered under Hon’ble Supreme Court judgment dated 04.11.2022. Accordingly, only in case of applicants otherwise eligible for pension on higher wages as per the directions of the Hon’ble Supreme Court judgment dated 04.11.2022, for scrutiny regarding Para 26(6), following procedure may be followed:
Read More: Higher pension from EPF: Will EPFO extend the deadline again amid lack of clarity?
(i) Field Offices will verify that
a) Employer share of PF contribution has been remitted on employee’s pay exceeding the prevalent statutory wage ceiling of Rs 5,000/6,500/15,000 per month from the day the pay exceeded the wage ceiling or 16.11.95 whichever is later, till date/ till the date of retirement or superannuation as the case may be; and
b) Administrative charges payable by employer have been remitted on such higher wages; and
c) Provident Fund account of employee has been updated with interest as per Para 60 of EPFS,1952 on the basis of such contribution received; and
d) Any of the following documents have been submitted along with Applications for Validation of Option / Joint Options as proof of joint option and permission under Para 26(6).
• Wage Details submitted by the employer along with Applications for Validation of Option / Joint Options
• Any salary slip / letter from employer authenticated by employer
• Copy of joint request and undertaking from employer
• Letter from PF office issued prior to 04.11.2022 indicating PF contribution on higher wages
Read More: Why You Should Merge Your Multiple EPF Accounts And How To Do So
“The applicants who qualify (i) above and are already contributing/ have contributed till retirement/superannuation on actual (higher) pay, if they have not submitted their joint requests and undertaking of employer, can submit the same at the time of final claim settlement through their last employer. Joint Request and undertaking of employer for permission under Para 26(6) (pro forma enclosed) can be submitted by pensioners/members any time before the grant of pension on higher wages in accordance with decision of Hon’ble Supreme Court dated 04.11.2022,” stated EPFO circular.
Earlier, EPFO also released a circular on computation of higher pension. Higher pension contribution for those retired before September 1, 2014.
For eligible applicants whose pension commenced before September 1, 2014, the calculation of a higher pension will be determined based on the average monthly pay received during the contributory period of service within the 12 months preceding the date of exit from the membership of pension fund. Those who retired/will retire on or after September 1, 2014.
For individuals who retire on or after September 1, 2014, the calculation of a higher EPS pension will be based on the average salary earned during the contributory period of service in the span of 60 months preceding the date of exit from the membership of pension fund.
It is important to note that the government made a revision to the pension calculation formula in September 2014. Prior to August 31, 2014, the average salary considered for pension calculation was based on the preceding 12 months before retirement. However, starting from September 1, 2014, the government revised this period to 60 months.
