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Rescinding its earlier decision after employee protests, the Employees’ Provident Fund Organisation (EPFO) has decided to allow members to withdraw their entire corpus before retirement for purposes such as housing, professional education, medical treatment and the marriage of their children.
The earlier notification (dated February 10 and effective from May 1) imposed restrictions on PF withdrawal before the age of 58 years.
New notification A new notification will be issued soon, after which the decision would take immediate effect, Labour & Employment (Independent charge) Minister Bandaru Dattatreya said at a press conference here on Tuesday.
Dattatreya said the decision was taken after “detailed deliberations and on receiving various representations from trade unions”.
However, trade unions, while welcoming the move, said they would continue to demand removal of all curbs on PF withdrawal. The money belongs to workers, said Pawan Kumar, organising secretary of the RSS-backed Bharatiya Mazdoor Sangh.
Protest in Bengaluru The Ministry’s decision comes also in the backdrop of thousands of garment workers in Bengaluru — from firms such as Shahi Exports, K Mohan and Co Exports and Jockey — taking to the streets protesting against changes in PF withdrawal norms. Flaying the “misinformation campaign” in Karnataka, Dattatreya clarified that the EPFO had “decided to pay the full accumulations standing to the credit of a member, including interest thereon, up to the date of payment” fulfilling the conditions for withdrawal laid down in the new notification.
Labour Secretary Shankar Agarwal said the earlier restriction on withdrawal was only on 3.67 per cent of the total 12 per cent employer contribution, as 8.33 per cent goes towards pension. “That restriction (on 3.67 per cent) has now been removed,” he said.
In the February 10 notification, the Ministry had proposed that an employed member below 58 years could withdraw only his own contribution and the interest accrued on it.
It also proposed to raise the retirement age for PF withdrawal to 58 years against the earlier 54 years.
Under existing rules, a member has to be out of a job for at least two months to withdraw the entire corpus.
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