Employee’s pension scheme: Rs.7500. No, now you will get 25 thousand pension, see calculation.
Employee’s pension scheme: Private sector employees can get relief. Soon there may be a big change in the minimum pension amount in their Employee Pension Scheme. In one stroke, the amount of pension can increase from Rs 7500 to Rs 25000. Employees’ pension (pension, EPS) may increase by more than 300%.
EPFO has Employee Pension Scheme-1995 for all EPF subscribers. In this, people working under the organized sector get pension after the age of 58 years. It is mandatory for the employee to have at least 10 years of service. The employee contributes 12% of his salary to EPF and the employer contributes the same amount. But, a part of the employer’s contribution is deposited in EPS.
Pension is calculated on Rs 15000
The maximum pension in the Employee Pension Scheme of the Employees’ Provident Fund Organization (EPFO) is Rs 15,000 (basic salary). It has a roof over it. Meaning, even if your salary is more than 15 thousand rupees (basic salary) a month, but pension will be calculated only on a maximum salary of 15 thousand rupees.
EPS pension to be calculated on last pay
If the pension of the employees is calculated on the basis of last pay i.e. higher pay class, then they can get a big relief! The condition for getting pension under the Employee Pension Scheme is that it is necessary to contribute to the Employees Provident Fund (EPF) for 10 years. Whereas, on completion of 20 years of service, a weightage of 2 years is given. Let us understand how much difference will be made by removing the ceiling.
Rs 15,000 limit on EPS pension
According to the existing system, if an employee is doing a job from January 1, 2022, and if he wants to take pension after completing 15 years of service, then his Employee Pension Scheme (Employee pension scheme) pension will be calculated at Rs 15,000 only!
Whether the employee is in a basic salary of Rs.20,000 or Rs.30,000. According to the source, on completion of 15 years, the employee will get a pension of about Rs 3000 from January 2, 2037. The formula for calculation of pension is (service history x 15,000/70). But, if the limit of pension is reached, then the pension of the same employee will increase.
Employee’s pension scheme Example No. 1
Suppose the salary (Basic Salary + DA) of an employee is Rs.20,000. Calculating from the formula of Employee pension scheme, his pension will be Rs 4000 (20,000X14)/70 = Rs 4000. Similarly, higher the salary, more will be the benefit of pension. There can be a jump of 300 percent in the pension of such people.
Employee’s pension scheme example no-2
Suppose the service of an employee is 33 years. His last basic salary is 50 thousand rupees. Under the existing Employee Pension Scheme system, pension was calculated only on a maximum salary of Rs 15,000.
Thus (Formula: 33 years+2= 35/70×15,000) the pension would have been Rs 7,500 only. This is the maximum pension in the current system. But, after removing the limit of pension, adding the pension according to the last salary, he will get a pension of Rs 25000 thousand. Means (33 years + 2 = 35/70×50,000 = Rs.25000).
333% more profit
Let us tell you that according to the rules of EPFO, if an employee contributes to EPF continuously for 20 years or more, then two more years are added to his service. Thus 33 years of service was completed, but pension was calculated for 35 years. In such a situation, there will be a big jump of 333% in the amount of Employee Pension Scheme of that employee.
