EPFO on board Air India, supports 7,453 airline employees

Pension fund body EPFO ​​has incorporated Air India Ltd for social security benefits such as PF, pension and insurance and received contributions for around 7,453 employees for the month of December from the company airline, a statement from the Ministry of Labor said on Saturday.

The Tata Group has taken over the debt-ridden airline from the Indian government. Air India had applied for EPFO ​​cover, which was approved, the pension fund body said.

“EPFO (Employees’ Provident Fund Organization) on board Air India for social security cover to meet the social security needs of their employees. Air India Ltd has applied for voluntary cover u/s 1(4) of the EPF & MP Law, 1952 which was authorized to notify the Official Gazette on January 13, 2022 – with effect from December 1, 2021,” the ministry statement read.

Social security benefits will be paid to around 7,453 employees for whom contributions have been lodged by Air India with EPFO ​​for the month of December 2021, it added.

These Air India employees will now be entitled to benefits such as an additional 2% employer contributions into their Provident Fund (PF) accounts at 12% of their salary.

Previously, they were covered by the PF Act of 1925, where contributions to the PF were 10% by the employer and 10% by the employee.

The EPF 1952, EPS 1995 (employee pension plan) and EDLI 1976 (group insurance) schemes will now apply to employees.

A guaranteed minimum pension of Rs 1,000 per month will be available for employees and pensions for family and dependents in the event of death of the employee.

An assured insurance benefit in the event of death of a member will be available in the range of minimum Rs 2.50 lakh and maximum 7 lakh.

No premium is charged to EPFO-covered employees for this benefit.

The ministry informed that since 1952-1953, Air India and Indian Airlines were two separate companies covered under the PF Act of 1925. In 2007, the two companies merged into a single company, Air India Ltd.

Under the PF Act of 1925, provident fund benefit was available but there was no statutory pension or insurance scheme. The employees participated in a self-contributing pension plan based on an annuity.

Based on plan parameters, accruals were paid to employees. There was no guaranteed minimum pension or additional benefit in the event of a member’s death.

(Only the title and image of this report may have been edited by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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