The government is considering a proposal to contribute to the employees' share of the provident fund at companies with more than 100 workers. The scheme will cover only those earning a low salary.
If implemented, this will be an extension of the scheme under which the Union government is paying the EPF contribution of companies employing up to 100 workers of whom 90% earn less than ₹15,000 each per month.
“There is a proposal but the details are yet to emerge," said a government official requesting anonymity.
Government officials said there are a few possibilities under consideration – paying PF dues of workers earning up to ₹15,000 in all companies without the 90% rider; allowing companies employing up to 200 workers with 90% earning up to ₹15,000 per month; reducing the 90% salary rider to say 60% for companies having headcount of up to 100.
It is not known whether the government will contribute the entire 24% (both employers and employees share) of the EPF payment or a portion of it. Also, the scheme, if implemented, will be valid for three months.
The cost-benefit calculation will decide whether the proposal will be taken up and if yes, at what magnitude, another official said. “The next stimulus whenever comes will perhaps include this but it will not be across the board. The salary threshold will be ₹15,000 per month while deciding the beneficiaries," said the second official.
“The current proposal is benefiting some 1.1 million workers and if the rules are relaxed it will benefit may be around 2 million low wage earners. Is it enough, one may say no, but certainly of great help to workers at the bottom of the pyramid and companies whose businesses that are struggling with low cash flow," said the second official, adding that the aim is to provide a cushion to a section of workers facing difficulties due to the nationwide lockdown.
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