Employees can now withdraw their provident fund money without employers’ permission.
There was a time when changing companies meant a fresh PF account. As the withdrawal of money from the account was a cumbersome exercise, many employees preferred to give up on their PF money. The government then allowed employees to carry on with the same PF account through universal account number or UAN. Still, withdrawing money from the PF account remained an exhausting exercise as it required approval from the respective employers.
Now, there is yet another change in the rule. The withdrawal procedure has been simplified! Employees can now withdraw their provident fund money without the employers’ permission. The statutory requirement of obtaining prior approval from employers is no longer a necessity.
The Employees’ Provident Fund Organisation (EPFO), vide its circular dated 1 December 2015 (No WSU/10(1)2011/Changes in MAP/31406), has notified this change with immediate effect.
This benefit can be availed by employees whose details, such as Aadhaar number and bank account number, have been linked to the EPF universal account number (UAN) and whose know-your-customer (KYC) verification has been done by the employer (using digital signature).
After linking their Aadhaar and bank account numbers to the UAN and activating the same, employees will need to submit claims in Form 19, Form 10C and Form 31, directly to the concerned regional provident fund commissioner, as per specifications of the central provident fund commissioner, for fast settlement of claims. Attestation of their employers will not be required.
However, it has been observed that many EPF subscribers have still not activated their UAN on the EPFO portal due to lack of awareness amongst the employees. Pending KYC or lack of digital signature of the employers is yet another constraint.
Increased employee participation through linking of details with UAN and adoption of the new withdrawal process is expected to ensure seamless employee transitions with minimum administrative delays and employee disputes.