Employee Pension Scheme EPS 95: Private sector employees can get great relief in the Employee Pension Scheme. The EPS pension (Pension Fund) of an employed person contributing to the Employees’ Provident Fund (EPF) can increase manifold. EPFO board can take a decision on this soon. It is believed that under the Employees Pension Scheme-95, the pension can be increased up to 333 percent.
New Employee Pension Scheme EPS 95
The maximum pension in the Employee Pension Scheme is fixed at Rs 15,000. After this sealing is done in it. Meaning, even if the basic salary is more than 15 thousand rupees a month, but your EPS pension (Pension Fund) will be calculated on a maximum salary of 15 thousand rupees.
EPS Pension Fund can increase manifold
The matter of ceiling of pension is pending with the division bench of the Supreme Court. Hearings have been held at many levels in this Employee Pension Scheme. The union has been continuously demanding that the capping on pension be abolished. If the decision comes in favor of the employees, then the EPS pension (Pension Fund) can also be calculated on the last pay i.e. higher pay bracket.
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With this decision, it is possible to increase the pension of the employees by up to 300 percent.
The condition of taking pension under Employee Pension Scheme is that it is necessary to contribute to Employees Provident Fund (EPF) for 10 years. While after completing 20 years of service, weightage of 2 years is given. Removal of ceiling in EPS pension (Pension Fund) will make a lot of difference.
How will your pension increase in Employee Pension Scheme 95?
According to the existing rules of the Employee Pension Scheme, if an employee is working anywhere from June 1, 2015 and wants to take pension after completing 14 years of service, then his EPS pension (Pension Fund) is calculated at 15 thousand. Only Rs. Even if the employee is in basic salary of Rs 20 thousand or Rs 30 thousand.
According to the old formula, on completion of 14 years from June 2, 2030, the employee will get around Rs 3000 EPS Pension (Pension Fund)! The formula to calculate pension is (service history x 15,000/70). But, if the pension limit is abolished, then the Employee Pension Scheme pension of the same employee will increase.
Example number 1 in Employee Pension Scheme
Suppose the salary (Basic Salary + DA) of an employee is Rs.20,000. Calculating from EPS Pension (Pension Fund) formula, his pension will be Rs 4000 (20,000X14)/70 = Rs 4000. Similarly, the higher the salary, the more he will get the benefit of pension in the Employee Pension Scheme. There can be a 300 percent jump in the pension of such people.
EPS Pension Pension Fund Example No. 2
Suppose an employee has a job of 33 years. His last basic pay is Rs.50,000. Under the current system, the EPS pension (Pension Fund) will be calculated only on a maximum salary of Rs 15,000. In this way (formula: 33 years + 2 = 35/70×15,000) the pension would have been Rs.7,500 only.
This is the maximum pension in the existing system in the Employee Pension Scheme. But, if the limit of pension is removed and pension is added according to the previous salary, then he will get a pension of Rs 25,000 thousand. Means (33 years+2= 35/70×50,000= Rs 25000).
333 percent salary will increase in Employee Pension Scheme
Explain that according to the rules of EPFO, if an employee contributes to EPF continuously while working for 20 years or more, then two more years are added to his service period. Employee Pension Scheme EPS 95
Thus his 33 years of service was completed, but the EPS pension (Pension Fund) was calculated for 35 years. In such a situation, in the Employee Pension Scheme, the salary of that employee can increase by up to 333 percent!