Employees of IT majors lead in availing EPF advances under Covid window

By: |
September 7, 2020 5:40 AM

Of the total 685 exempted establishments whose employees have availed the benefit, 182 are controlled by government, 444 private and 59 establishments were in the co-operative sector.

EPFO data showed among the top five private exempted establishments in terms of the number of employees who have availed Covid-19 advance benefit.

As many as 33,745 employees at TCS, the highest number among ‘exempted establishments’, have availed themselves of Covid-19 advances amounting to a total of Rs 1.5 crore from their employees’ provident fund (EPF) accumulations in the April-July period. Following the Covid-19 outbreak, EPFO offered members the opportunity to avail advance not exceeding three months’ basic wages and dearness allowances or up to 75% of the amount standing to the credit of their respective accounts.

Remaining within the administrative control of the Employees’ Provident Fund Organisation (EPFO), exempted establishments manage the provident fund accounts of their employees. They keep the provident money with themselves, but transfer the pension portion to the EPFO.

Around 1,550 such establishments belonging to public, private and co-operative sectors manage an estimated Rs 50,000 crore corpus among them. Large companies are entitled to apply to EPF for exemption from the requirement to deposit the EPF contributions with the EPFO, even as all of them do keep EPF funds and manage it themselves, as per the EPFO guidelines.

EPFO data showed among the top five private exempted establishments in terms of the number of employees who have availed Covid-19 advance benefit, three belong to the IT sector – TCS, HCL and Infosys. And, together their employees account for around 17% of the total claims for advances settled during the period. TCS tops the list followed by HDFC Bank (12,921), HCL (11,957), Infosys (5,534) and Maruti (2,146), in that order.

“Such large number of claims from the Covid-unaffected IT and ITeS sectors show that labour market institutions like social security coverage, trade union and legal protection are important,” said XLRI professor KR Shyam Sundar.

In all, a total of 3,04,681 EPFO members from around 685 exempted establishments have availed the facility to withdraw Rs 3,128 crore from their accumulations in April-July. From the public sector, 15,654 KSRTC employees availed the benefit, followed by MSEB at 15,293, ONGC at 8,584, RINL at 4,850 and IOC at 3,487. The Tamil Nadu Cooperative Milk Producers tops the list in the cooperative sector.

Of the total 685 exempted establishments whose employees have availed the benefit, 182 are controlled by government, 444 private and 59 establishments were in the co-operative sector. In terms of the amount disbursed, public, private and co-operatives account for 66.56%, 30.91% and 2.53% respectively.

According to EPFO, as on August 31, online Covid-19 advance claims of 35.30 lakhs members have been processed and Rs 9,369 crore has been disbursed to them. This includes exempted as well as other firms.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Embedded Value: When claim is rejected due to suicide clause
2COVID-19 impact: 65% people suffer loss of income, 55% may seek loan recast, says survey
3Faceless Assessment: The benefits and challenges taxpayers may experience