Centre, employees for detailed study of EPFO case verdict

Labour Ministry to come up with detailed guidelines on implementing the Supreme Court judgement

The Supreme Court had upheld the verdict in the case of RC Gupta vs EPFO. File | Photo Credit: The Hindu

The Union Labour Ministry, the Employees’ Provident Fund Organisation (EPFO) and organisations of employees and employers are studying the Supreme Court order on Friday upholding the validity of the Employees Pension (Amendment) Scheme of 2014. Sources in the Labour Ministry said it would come up with detailed guidelines for the employees and employers on implementing the verdict.

Workers’ representative on the EPFO Board of Trustees A.K. Padmanabhan told The Hindu that the Supreme Court had upheld the verdict in the case of RC Gupta vs EPFO. “May be there are some points which need to be clarified. We have been maintaining that what EPFO has done to a section of workers was an injustice. We will study the judgment before making a detailed comment. Many of our unions have gone to the court demanding clarification on this issue,” Mr. Padmanabhan said.

‘Incomplete verdict’

BMS national secretary V. Radhakrishnan said the apex court had not taken a decision on a number of issues that were connected with the minimum pension. “This verdict is incomplete. Certain aspects in the verdict such as approving the EPFO’s argument that the average of last 60 months’ salary should be considered for calculating the pension are not good for the workers. But the verdict clearly declined to accept the EPFO’s argument that the worker will have to remit the Union Government’s component of 1.16%. This is a welcome step. Our view is that this verdict needs more clarity from the court,” he said.

K.E. Raghunathan, another member of the board representing employers, said the judgment needed to be studied in detail on its deliverables from each stakeholder such as the EPFO, employers and employees for a detailed remark. “However, from an employer perspective, on a closer look at the judgment, it infers there may not be any immediate impact. As per page 39 of the judgment, the Supreme Court suggests that employer’s contribution to pension can be increased as a possible solution. This could be a cause of concern that employers’ burden may increase,” he said. Mr. Raghunathan added that such a step, anyway, would require amendment to the Act, if the Centre so decides. “Even then there will be no additional liability on employer. Only inter-se allocation of contribution between PF and pension will change,” he added.