Pensioners question EPFO note on higher pension, seek clarity

Circulars issued by the EPFO are against the Supreme Court order and can invite contempt of court procedures, says CBT member Harbhajan Singh Sidhu

January 27, 2023 09:15 pm | Updated January 31, 2023 09:22 pm IST - New Delhi

Photo used for representation purpose only.

Photo used for representation purpose only.

Pensioners’ organisations and members of the Central Board of Trustees (CBT) of the Employees Provident Fund Organisation (EPFO) have alleged that the recent circulars of the EPFO on higher PF pension are against the Supreme Court verdict on the matter and previous circulars of the organisation. They questioned the EPFO’s stand that the cases of employees, who retired prior to September 1, 2014 without exercising any option under paragraph 11(3) of the pre-amended Employees’ Pension Scheme (EPS), 1995, and were availing higher pension on higher wages, “need to be re-examined.”

CBT member and general secretary of Hind Mazdoor Sabha (HMS) Harbhajan Singh Sidhu told The Hindu that he will raise the issue in the next meeting of the CBT scheduled in February. “We don’t know the government’s stand and the preparations taken by the EPFO on implementing the Supreme Court order on higher PF pension. The circulars issued by the EPFO are against the Supreme Court order and can invite contempt of court procedures. This stand of the EPFO that only those who retired before September 1, 2014 are eligible for higher pension is a clear violation of the Supreme Court order,” Mr. Sidhu said. The joint meeting of about 10 central trade unions and various sectoral unions and federations scheduled here on January 30 may also discuss the issue.

Convener of the National Action Committee (NAC) of pensioners under EPS-95, retired Commander of Indian Navy Ashok Raut, said EPFO has misinterpreted the Supreme Court order. “They do not want to give higher pension for pensioners. It is very clear from their action,” Mr. Raut told The Hindu. In a letter to Central Provident Fund Commissioner Neelam Shami Rao, he said the Supreme Court allowed all pensioners to exercise option within a period of four months from November 4, 2022. “The EPFO remains silent over the subject matter of options and did not circulate the format of options to be exercised within the stipulated period. The letters issued on December 29, 2022, January 5, 2023 and January 25, 2023 are unworthy to extend the benefit of pension on a higher salary. The joint option is condition precedent and integral part of the benefit of higher pension which is not allowed as on to date,” he said in the letter. The NAC, he added, has decided to exercise the joint option “without further waiting for any optimistic action” of the EPFO. “Accordingly all the Pensioners at an individual level shall submit an option for a higher pension,” he added.

Activist for pensioners’ rights Parveen Kohli said the pension of 24,672 persons was revised by implementing the R.C. Gupta judgement of the Supreme Court through the circular released by the EPFO on March 23, 2017 after approval by the CBT. He said the window for exercising option under Para 11(3) remained closed from December 1, 2004 till 2016. “By adopting an arbitrary cut-off date through a circular on December 1, 2004, the EPFO stopped accepting contribution on actual salary in the pension fund. This fact has also been informed by the EPFO to the CBT in the 221th & 224th meeting of the CBT. Subsequently, considering the financial viability of the Employees’ Pension Scheme, 1995 based on various actuarial reports till then, the opportunity for giving option to contribute on higher wages on becoming member of the Employees’ Pension Scheme was stopped in 2004,” Mr. Kohli said.

“When the window for exercising option under para 11(3) remained closed from December 1, 2004 till 2016, how could have the retirees before September 1, 2014 exercised the option under Para 11(3) of pension scheme,” he asked. “Option to contribute on a pay exceeding statutory limit is available to a member only under Para 26(6) of the EPF Scheme, 1952 and not under 11(3) of EPS-95. In fact, Para 11(3) clarifies the methodology of determination of pensionable salary only,” he added questioning the circular of the EPFO.

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