Trustees of retirement fund body EPFO may approve a proposal tomorrow to reduce the mandatory contributions toward social security schemes run by it to 10 percent for workers as well as employers.
Presently, employees and employers contribute 12 percent of basic wages each towards Employees Provident Fund Scheme (EPF), Employee Pension Scheme (EPS) and Employee Deposit Linked Insurance Scheme (EDLI).
The proposal to reduce the contributions by employers and employees to 10 percent of basic wages, including basic pay and dearness allowance, is listed on the agenda for meeting of the Employees’ Provident Fund Organisation (EPFO) scheduled on May 27, 2017 in Pune, a source said.
The source said the labour ministry received several representations stating that the move will leave more money with workers for expenditure and reduce employers liability, which will eventually perk up economy.
However, trade unions have decided to oppose the proposal saying this will dilute these social security schemes.