EPFO onboards Air India for social security coverage

New Delhi, Jan 30 (FN Agency) Employees’ Provident Fund Organisation (EPFO) has on-boarded Air India for social security coverage. “The social security benefits will be provided to around 7,453 employees for whom contributions have been filed by Air India with EPFO for the month of December 2021,” a Labour Ministry press release said. In the run-up to the privatisation, Air India Ltd had applied for voluntarily being covered u/s 1(4) of the Employees’ Provident Funds and Miscellaneous Provisions Act.This had been allowed with effect from December 1, 2021.

Air India is now a private entity as Tata Group has acquired the entire shareholding of the government in the airline. The disinvestment process got completed this week and government handed over the airline with management control to the private conglomerate. Following Air India’s joining to the EPFO, employees covered under the scheme would receive additional 2% employer’s contributions in their Provident Fund (PF) accounts at 12% of their wages. Earlier, they were covered under the PF Act of 1925, where the contributions to the Provident Fund was at 10% by employer and 10% by employee. EPF Scheme 1952, Employee Pension Scheme (EPS) 1995 and Employees’ Deposit Linked Insurance (EDLI) 1976 will now be applicable to the employees. “A guaranteed minimum pension of Rs 1,000 will be available to employees and pensions to family and dependents in case of death of employee.

An assured insurance benefit in case of death of member will be available in the range of minimum Rs 2.50 lakh and maximum Rs 7 lakhs. No premium is charged to the EPFO covered employees for this benefit,” the Labour Ministry statement said. Since 1952-53, Air India and Indian Airlines were two separate companies that were covered under PF Act 1925. In 2007, both the companies merged into one company – Air India Ltd. Under the PF Act 1925, benefit of Provident Fund was available but there was no statutory pension scheme or insurance scheme. The employees used to participate in self-contributory annuity-based pension scheme. Based on the scheme parameters, the accumulations used to be paid to the employees. There was no minimum pension guarantee and no extra benefit in case of death of a member.