EPFO New Rules: Huge Relief For PF Account Holders Nominees; EDLI Death Benefits Money Settlement To Be Bereft Of Payout Shortage

The Employees' Provident Fund Organisation (EPFO) published a circular on Wednesday announcing that the minimum payout benefit to legal heirs would be raised to Rs 50,000. It further underlined that weekends and other holidays will not be considered breaks in service when switching between jobs.

The EPFO noted that the minimum benefit given to dependents or legal heirs of members who have not rendered continuous service of 12 months before the month of their death and have an average PF balance of less than Rs 50,000 has been increased to Rs 50,000. Members who die in service within six months of their last contribution received, providing they were still on the employer's rolls, EDLI benefits would be payable to dependents or legal heirs of employees as per the Scheme.

The circular stated that in EDLI death claim cases, payments under the EDLI Scheme are being denied or settled for a reduced amount due to short gaps being interpreted as a break in service without proper assessment of work continuity. The notification further said that an instance had been reported in which Saturday and Sunday fell directly between the date of exit from one establishment and joining in another establishment and were treated as break service. The member has served for more than 12 months yet was not considered eligible for EDLI benefits.

In a move to remove anomalies caused by breaks in service that resulted in denial of EDLI benefits, the objective of continuous service was introduced. 

"Continuous spells of service immediately followed by Saturdays, Sundays or any declared weekly off in the last or present establishment, National holiday, Gazetted holiday, State holiday and Restricted holiday are to be treated as part of continuous service only, provided the date of exit from one establishment and date of joining in the next establishment covered under EPF & MP Act, 1952 are separated only by such offs/holidays. 

"The Saturdays, Sundays or any declared weekly off in the last or present establishment, National holiday, Gazetted holiday, State holiday and Restricted holiday shall not be treated as break in service and the service shall be treated as continuous.” EPFO circular stated.

The circular stated that members who have worked in more than one EPF covered establishments and have a break of up to 60 days between two stints would be ignored and such multiple services shall be treated as continuous service.