The Ministry of Labour and Employment (“Ministry”) has notified amendments to the Employees’ Pension Scheme, 1995, to establish a new uniform rate for recovering damages from employers who default on their contributions to the Employees’ Pension Fund.
Under the revised scheme, damages will now be calculated at a rate of 1% per month on the outstanding contribution amount. This amendment dispenses with the previous tiered system, which imposed damage rates varying from 5% to 25% per annum based on the duration of the default. The new uniform rate applies regardless of the length of the default period.
The responsibility for recovering these damages rests with the Central Provident Fund Commissioner or an officer authorized by the Central Government.
Source: Ministry of Labour and Employment
