• Introduced in 1995 by the Employees Provident Fund Organisation (EPFO) under the Ministry of Labour and Employment.
• Provides pension benefits to employees in the organized sector.

• To provide pension benefits to employees in the organized sector.
• Ensures financial security for employees post-retirement or in case of disability or death.

• Employee and Employer Contribution: Both contribute 12% of the salary towards the EPF.
• Employer’s Contribution: 8.33% of the employer’s contribution goes towards the pension fund.
• Union Government Contribution: 1.16% of the employee’s basic salary is contributed to the pension fund.
• Pension Fund Setup: The fund is created by allocating 8.33% of the employer’s contribution from the EPF corpus.

• Pre-Amendment Scheme: Pensionable salary was based on the average salary of the last 12 months prior to exiting the pension fund.
• Post-Amendment Scheme (2014): Pensionable salary based on average salary of the last 60 months (5 years).

• Applies to employees whose basic salary exceeds ₹15,000 per month.
• Employees who are members of the Employees’ Provident Fund (EPF) and meet the contribution requirements are eligible for the scheme.

PYQ:

[2021] With reference to casual workers employed in India, consider the following statements:

1. All casual workers are entitled for Employees Provident Fund coverage.

2. All casual workers are entitled for regular working hours and overtime payment.

3. The government can by a notification specify that an establishment or industry shall pay wages only through its bank account.

Which of the above statements are correct?

(a) 1 and 2 only

(b) 2 and 3 only

(c) 1 and 3 only

(d) 1, 2 and 3