Govt to pay employers’ contribution to the provident fund till March 2019

Establishments registered with EPFO will need to have a Labour Identification Number (LIN) allotted to them under the Shram Suvidha Portal to avail this scheme. 

The Pradhan Mantri Rojgar Protsahan Yojana (PMRPY) Plan Scheme has been designed to incentivise employers to generate new employment. As per this scheme, the Government of India will pay the 8.33 per cent EPS contribution of the employer for the new employment.

For a new employee to gain out of the scheme, the last date to get registered with an establishment, covered under EPFO, will be March 31, 2019.

This scheme has a dual benefit—on the one hand, the employer is incentivised for increasing the employment base of workers in the establishment, and on the other hand, a large number of workers will find jobs in such establishments. A direct benefit is that these workers will have access to social-security benefits of the organised sector.

The PMRPY scheme is targeted for employees earning wages less than Rs 15,000/- per month. A new employee is one who has not been working in an EPFO-registered establishment on a regular basis prior to 01 April, 2016 and will be determined by the allocation of a new Aadhaar-seeded Universal Account Number (UAN) on or after 01.04.2016. In case the new employee does not have a new UAN, the employer will facilitate this through the EPFO portal.

The employers will continue to get the 8.33 per cent contribution paid by the Government for these eligible new employees for the next three years, provided they continue in employment with the same employer. The 8.33 per cent contribution will be paid by GOI after the employer has remitted the 3.67 per cent EPF contribution for these new employees each month.

To avoid any penalty on the EPF/EPS contribution, the employer is advised to submit the PMRPY online form at the earliest, preferably by the 10th of the following month.

Establishments registered with the EPFO will need to have a Labour Identification Number (LIN) allotted to them under the Shram Suvidha Portal to avail this scheme.

The LIN will be the primary reference number for all communication to be made under the PMRPY Scheme.

The eligible employer must have added new employees to the reference base of workers in order to avail benefits under the Scheme from August, 2016 onwards.

The reference base of workers will be determined by the number of employees against whom the employer has deposited the 12 per cent (3.67% EPF + 8.33% EPS) with EPFO as on 31 March, 2016, as ascertained/verified from the monthly ECR for March, 2016.

For instance, a business establishment files an ECR for the employers’ contribution, for 45 employees or workers in March, 2016. In the month of April, 2016, the establishment adds, say, 15 new workers bringing the total of employees to 60. In such a case, the employer will be eligible to apply for the PMRPY scheme benefits for these 15 new employees.

The employer will not be eligible for PMRPY benefits if there is no new employment vis-à-vis the reference base in any subsequent month.

For new establishments coming into existence/getting registered with EPFO after 01 April, 2016, the reference base will be taken as zero/nil employees. Thus, the employer can avail of PMRPY benefits for all new eligible employees.