In this article, we shall discuss about Pradhan Mantri Rojgar Protsahan Yojana Scheme, it’s benefits to the employers and employees, eligibility criteria for applying through this scheme in detail which is as follows:
PF interest rates update The interest rate applicable to the EPF contributions is 8.5% for FY 2020-21.
Union Budget 2021 Outcome If the contribution to Employees’ Provident Fund (EPF) and Voluntary Provident Fund (VPF) exceeds Rs 2.5 lakh in a financial year, the interest accrued on such excess contribution shall be taxable. In the case of government employees, the threshold limit is Rs 5 lakh.
What is the Pradhan Mantri Rojgar Protsahan Yojana Scheme?
The Pradhan Mantri Rojgar Protsahan Yojana, or PMRPY Scheme is aimed at incentivising employers to generate employment, where the Government pays the employers’ Employee Pension Scheme share of 8.33 percent, for new employees for the first three years of their job. There is also a proposal to make this applicable for those who are unemployed but are semi-skilled and unskilled as well.
The Ministry of Labour has implemented the same scheme and has been in operation since August 2016.The PMRPY scheme was announced during the 2016-17 Budget with the primary purpose of promoting the generation of employment with INR 1000 crores having been made. The scheme targets workers who earn wages of less than INR 15000 on a monthly basis. It encourages employers of Small and Medium Enterprises and Micro Businesses to avail the benefits of this project.
The Purpose of the PMRPY Scheme
The Pradhan Mantri Rojgar Protsahan Yojana (PMRPY) aims to incentivise those employers who are registered with the Employees’ Provident Fund Organization (EPFO) in order to create jobs. Apart from paying the 8.33 percent towards the contribution of employees EPS, for the textile industry, the government also intends to pay 3.67 percent towards the Employees Provident Fund for the eligible employers of new employees.
The scheme serves two purposes; one, it encourages job creation by the employers by incentivising them, and on the other hand, gets a large number of workers find jobs. One major benefit to these workers is the access to social security benefits in these organized sectors.
What is the Eligibility Criteria for Applying for the Pradhan Mantri Rojgar Protsahan Yojana?
The scheme is available for all the establishments that are registered with the Employees’ Provident Fund Organization and satisfy the following conditions:
The target of the PMRPY are workers earning wages less than INR 15000 per month and hence, the new employees who earn more than INR 15000 monthly, do not qualify for this scheme. A new employee would be one who has not been working regularly in an EPFO registered organization prior to April 1, 2016. This is determined by the allocation of a new Aadhaar linked Universal Account Number on or after April 1, 2016. If the employee does not have a new UAN, the employee can facilitate this through the Employee Provident Fund Organization portal.
The business must be registered with the EPFO and must have a Labour Identification Number (LIN) that one can acquire under the Shram Suvidha Portal. Under the PMPRY scheme, the Labour Identification Number will serve as the primary reference number for all official communication.
The employers and establishments that apply for this scheme are held fully responsible for the information that they furnish. If at any time any of it is found to be incorrect, it will be assumed that the EPS payment/EPF payment for the textile industry, was not made for the employees. This will make the employer liable to penalties under the rules of The Employees’ Provident Fund Scheme, 1952.
The employers who are eligible for the scheme should add the new employees to the workers’ reference base to make use of the benefits under this scheme. However, the determination of the workers reference base will be done by the number of employees against whom the employers makes the 12 percent deposit (ie. 3.67 percent EPF and 8.33 percent EPS), as on March 31, 2016. This is verified from the March 2016 monthly ECR.
Establishments that get registered with EPFO after April 1, 2016, will have their reference base for employees be taken as Zero/NL. This way the employer will be able to access the PMRPY benefits for new eligible employees.
The Government will continue to pay the 8.33 percent to the employers for the eligible new employees for the first three years if they continued with the same employer in the same employment. The 8.33 percent will be paid by the Government post the remittance of 3.67 percent EPF contribution by the employer. The employer is to submit the PMRPY online form before the 10th of the following month to avoid any fine.
What is the duration of the PMRPY scheme?
The Pradhan Mantri Rojgar Protsahan Yojana is scheduled to be in operation for a span of three years. The Government of India will however continue to contribute towards the EPS at 8.33 percent, which the employer is to make for the next three years. Therefore, all the eligible new employees will be covered under the scheme till the year 2019-2010.
How can I Avail the Benefits Under the PMRPY Scheme?
Following are the criteria for establishments to be able to claim the benefits of this scheme:
The establishment must be registered under the EPF Act 1952 with EPFO and a valid Labour Identification Number (LIN);
The registered establishment must have an organizational PAN;
The Company or business must have a valid bank account and have the details of the gateway through which the payments are made to the establishment.;
The ECR must be submitted by the establishment by the month of March 2016.;
The number of employees in the establishment must increase on or after April 1, 2016.;
All the new employees can be covered if they meet the necessary conditions in a new establishment that is registered after April 1, 2016.
What is the Process for the PMRPY Scheme?
Employers can visit the PMRYP site and log in with their LIN/EPFO registration ID.
The employers can then fill in the organizational details as mandated. This includes the Organizational PAN, the nature of the industry or sector as per the classification by the National Industrial Classification Code NIC-2008, which is maintained by the Ministry of Statistics and Programme implementation.
The scheme is to cover employment of new workers earning wages that are less than INR 15000, per month. There must be specific mention of the job role and post for the new employment along with the date the employee would join and the date of exit, if it is applicable.
The PMRPY form has to be submitted by the end of each month by the eligible employers at the earliest, preferably by the 10th of the following month.
Failure to submit the required information online on the PMRPY form by the designated time of 10th of the following month, the employer will stand to lose his benefits under the PMRPY Scheme for that particular month.
The employer will have to pay 3.67 percent EPF contribution towards the new employees for the submission form to be determined.
Frequently Asked Questions
What is the contribution of the Government in the PMRPY scheme?
The Government of India will pay the EPS contribution of 8.33% for all new employees for the first three years of employment.
Should the employees be registered with the EPFO?
The new employees must be registered with the EPFO and must have a UAN.
What is the upper limit of salary for the applicability of PMRPY scheme?
The PMRPY scheme is applicable for employees drawing a salary up to Rs 15,000 per month.
Does the PMRPY scheme apply to existing employees?
The PMRPY scheme does not apply to existing employees
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