New Delhi: Employees’ Provident Fund Organization (EPFO) has issued an important circular, which will benefit employees and their dependents who change
jobs. With this new decision, there will be no break in service due to weekends and government holidays, which can end the disputes related to death claims to a great extent.
EPFO has clarified that if an employee leaves one company and joins another company and only Saturday, Sunday or any declared holiday falls in between, then it will not be considered a break in service. Earlier, in many cases, it was seen that when the weekend fall between two jobs, the employee’s service was considered broken, due to which his family could not get insurance and pension related benefits.
EDLI Scheme Benefits
EPFO said that after the death of an employee, his family’s Employees’ Deposit Linked Insurance (EDLI) claim was rejected only because of a minor gap or a low amount was given. Many times the officers did not calculate the service properly, which caused damage to the dependents. This new circular has been issued to eliminate this error.
Now, if an employee has only weekly off, national holidays, gazetted holidays, state holidays or restricted holidays between the end of one job and the start of another job, then it will be considered a continuous service. EPFO has also said that if there is a gap of up to a maximum of 60 days while changing jobs, the service will be considered continuous.
Big relief to families regarding EDLI claims
EPFO has also increased the minimum payment received under the EDLI scheme. Now a minimum of Rs 50,000 will be paid to the nominee or legal heir, even if the employee has not completed 12 consecutive months of service. This benefit will be available even if the average balance in the employee’s PF account is less than Rs 50,000.
The new rule will also apply in cases where an employee dies within six months of his last PF contribution, provided the employee is still recorded in the employer’s records. This means that now the family will not face lengthy legal processes or disputes for insurance claims.
