As many as 27 exempted establishments have allowed the Employees’ Provident Fund Organisation (EPFO) to manage their employees’ provident fund directly in the last two years, leading to the addition of about 30,000 employees and Rs 1,688 crore to the fund body, the labour ministry said in a release on Sunday.
These establishments “surrendered” their exemption mainly due to improved services under the EPFO, the release said. Establishments that wish to manage the PF corpus of their employees need to seek exemption under Section 17 of the EPF Act. This allows EPFO to permit them to manage their own PF Trust without making contributions to the fund.
Such exempted establishments are, however, statutorily mandated to provide benefits that are at least on par with those provided by EPFO to subscribers and comply with the notified conditions of exemption.
However, the enhanced focus of EPFO on its stakeholders, along with professionally managed funds generating steady returns for members, has promoted the trend of surrendering exemptions, it said. As of March 31, 2023, as many as 1,002 exempted establishments were managing a corpus of Rs 3,52,000 crore of 3,120,323 members.
With faster claim settlement, higher rates of return, strong monitoring, and ease of engagement, services provided to both establishments and members by EPFO are continuously improving, the ministry said.