Members of EPS 95 filed petition in Supreme Court

Retirees and employees who are members of the Employees Pension Scheme, 1995 have filed a writ petition in the Supreme Court against the Centre and the Employees Provident Fund Organisation (EPFO), which administers the scheme.

They are demanding the squashing of a 2014 amendment and 2017 circular which they say has excluded thousands from receiving their rightful benefits under EPS 95.

The petition, which was filed in the apex court last month, has four individual petitioners and two organisational petitioners. The National Confederation of Retirees represents 42,555 retirees from the private and public sector who are all members of EPS 95, while the National Confederation of Officers Association represents 19,118 people currently working in central public sector organisations, most of whom are members of EPS 95.

Thousands of other employees who are not directly represented in the petition, but have been affected by the amendment are avidly watching the progress of the case. One Facebook group on EPS 95 has more than 66,000 members. When news of the petition was posted on the group last month, more than 500 people commented with sighs of relief and hopes for a speedy resolution.

“It is settled law that pension is not a bounty payment to which an employee is entitled to as a matter of right as retiral benefit for services rendered by him. It is a social security provided for him to lead a dignified life,” said the petition’s summary.

EPFO’s August 28, 2014 amendment had raised the wage ceiling amount for the scheme to ₹15,000 and amended the option for contribution on higher salary for existing employees, introducing a cut-off date of September 1, 2014.

It also reduced the pensionable salary considerably by averaging 60 months salary instead of 12 months to determine the last drawn salary amount.

According to the petition, the effect of this amendment is to exclude all new employees who joined after September 2014 from joining the pension scheme altogether; to exclude serving employees from benefiting from the option of contributing to the pension scheme on maximum salary; and to deny the benefit of opting for the scheme to retired employees if they missed the cut-off date.

The amendment and cut-off date were not given sufficient publicity to allow employees to opt for pension on higher salary if they wished, says the petition, adding that, “It is in these circumstances that the majority of the employees remained ignorant of the options available to them for the betterment of their life after retirement.”

In an October 2016 order, the Supreme Court had struck down the cut-off date clause in the amendment. Two months later, the Central Board of Trustees of the EPFO decided to comply with the order and allow members to get the benefit of pension on a higher salary.

However, on May 31, 2017, EPFO issued a circular claiming that EPS 95 members from “exempt” companies were excluded from the benefits of the SC’s 2016 order. These are companies which are exempt from maintaining a provident fund with EPFO, but not exempt from participation in the pension scheme.

With confusion prevailing, and different regional EPFO offices interpreting the order and circular differently, another slew of petitions landed in the courts.

Currently, at least 27 cases on various aspects of EPS 95 are pending in the Supreme Court.

EPS 95 members from unexempted companies who applied to increase their contribution for pension under the scheme after the Supreme Court’s order of 2016 were informed by the EPFO that, since they had not applied within the cut-off date, they were ‘deemed’ to have opted out even though they had remitted funds on full salary to their PF accounts.

The next hearing on this writ petition is scheduled for November 16.

Source: thehindu