Employee Pension Scheme: Who can apply for higher EPS and how to avoid procedural hassles?

Employees who are eligible to claim a higher pension in accordance with the judgment of the Supreme Court in the case of EPFO vs Sunil Kumar, which was decided on November 4, 2022, can apply for a higher pension on the website of the EPFO, provided you submit the application along with the required documents.  

“EPFO has made it clear that only online applications for higher pension will be accepted. No format of application has been prescribed by the EPFO. Claim applications should contain a joint declaration by the employer as well as the employee that they have contributed to the provident fund on higher salary/wages and should be accompanied by the (required) documents,” said BC Prabhakar Advocate and President Karnataka Employers’ Association.

The Employees Provident Fund Organization has asked pensioners to submit the following documents along with the claim for a higher pension.

 

• Proof of joint option under Para 26(6) of the EPF scheme duly verified by the employer and

• Proof of joint option under the proviso to erstwhile para 11(3) duly verified by the employer and

• Proof of remittance in Provident Fund on higher wages exceeding the prevalent wage ceiling of Rs 5,000/6,500/- and

• Proof of remittance in Pension Fund on higher wages exceeding the prevalent wage ceiling of Rs.5,000/-6,500/- if any and

• Written refusal of APFC or any other higher authority of EPFO to such requests /remittance.

 

For higher pension, the EPF department needs one to attach copies of the joint option exercised by them under para 26(6) of the EPF Scheme which was made by them when they decided to contribute to the provident fund on a higher salary. Similarly, the joint option under paragraph 11(3) of the Pension Scheme refers to the option exercised by the employees when this paragraph was inserted into the pension scheme in 1996.

However, there are procedural hassles as the above documents are not available to the employer and employee. “Both the above options will not be available with either the employer or the employees. The employees have contributed to the provident fund on a higher salary and the management has also made matching contribution and remitted to the provident fund. Further, the option contemplated under para 11(3) under the Pension Scheme also the employees have not exercised the option.  In the majority of cases, the employees have contributed to the provident fund on higher salary but the employers may or may not have remitted the 8.33 per cent on the actual salary as contributed to the provident fund but determined the said amount on the basis of the statutory salary limit for coverage under the EPF Scheme,” said Prabhakar.

Thus, there is a practical difficulty for the employees to furnish the joint option. Currently, there are no guidelines issued by the EPFO to resolve the issue of the joint option which is to be attached to the application for claiming the higher pension.

 

What should one do to avoid procedural hassles? 

Experts say the EPFO Head office shall have to clarify.  Such clarification will enable the claimants to upload the claim for a higher pension on the portal of the EPFO. “Any devices if made by the employers or the employees will not resolve the issue.  Only PF Department should come out with a clear clarification having regard to the realities at the establishment level with regard to the joint option for contributing to the provident fund on the actual salary and also remittance of contribution to the pension fund on the basis of the actual salary.  Until further guidelines are issued by the EPFO, either the pensioners or the existing employees will not be able to upload the claim for higher pension,” said Prabhakar.

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