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The proposal, which has been on the backburner for a number of years now, is being re-looked at.
“We’re evaluating all choices and a choice on this regard could possibly be taken by the brand new authorities,” the official stated. The federal government is of the view that robust steadiness sheet of India Inc will assist cushion the additional monetary burden that enterprises will incur on account of enhanced wage ceiling, a senior authorities official advised ET.
In keeping with the official, elevating the wage ceiling has large monetary implications for each the federal government in addition to the non-public sector.
“However the authorities has to maneuver in that route if it needs to deliver increasingly employees beneath the social safety web,” the official added. It’s estimated that thousands and thousands of employees will profit with the improved wage ceiling as minimal wages in most states are anyplace between ₹18,000 and ₹25,000, depriving them of any type of social safety. The wage ceiling beneath EPFO was final raised in 2014 to ₹15,000 from ₹6,500. Moreover, even the Workers’ State Insurance coverage Company (ESIC) has had the next wage ceiling of ₹21,000 since 2017 and there’s consensus throughout the authorities that the wage ceilings beneath the 2 social safety schemes must be aligned. Each EPFO and ESIC are beneath the executive management of the ministry of labour and employment.
Below the Workers’ Provident Fund and Miscellaneous Provisions Act, 1952, each worker and the employer make matching contributions of 12% every of fundamental wage, dearness allowance and retaining allowance, if any, to the EPF account. Whereas the worker’s complete contribution is deposited within the provident fund account, 8.33% of the employers’ contributions goes to the Workers’ Pension Scheme and the steadiness 3.67% is deposited within the PF account. EPFO subscribers are entitled to provident fund, pension and insurance coverage advantages beneath EPF & MP Act, 1952.
