EPF relief for employees, employers! FM Sitharaman says Centre to continue contribution for three months

Giving a major relief to both employees as well as employers, Finance Minister Nirmala Sitharaman on Wednesday announced that the government will continue to contribute towards Employees' Provident Fund (EPF) on behalf of select businesses for another three months. In total, a liquidity relief of Rs 2500 crore will be provided to support both businesses and workers for the next three months.

“To ease financial stress as businesses get back to work, Government decides to continue EPF Support for Business & Workers for 3 more months providing a liquidity relief of Rs 2,500 crore,” the finance minister said, while addressing media on Wednesday. 

The government said that Iin order to provide more take home salary for employees and to give relief to employers in payment of PF, EPF contribution is being reduced for Businesses & Workers for 3 months, amounting to a liquidity support of Rs 6750 crores.

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In March, the finance minister had announced that the government will take care of EPF contribution that of both the employer and the employee (12 per cent each) for the next three months in wake of coronavirus outbreak. The total contribution government will pay for 3 months is 24 per cent. 

The Finance Minister added, this is for all those establishments who have up to 100 employees and 90 per cent of the employees earn less than Rs 15,000. The EPF scheme regulation will be amended to allow non refundable advance to 75 percent of the amount standing to the credit or 3 months wages whichever is lower. This will benefit 4.8 crore workers.

“Govt of India will pay the Employees' Provident Fund (EPF) contribution, both of employer and employee, put together it will be 24%, this will be for next 3 months.This is for those establishments which have upto 100 employees and 90% of them earn less that 15,000,” the finance minister said.

The latest announcement came a day after prime minister Narendra Modi addressed the nation and confirmed that a new relief package will be announced on Wednesday.