After Tata Group’s Takeover, EPFO Onboards Air India For Social Security Coverage Of Employees
The social security benefits will be provided to around 7,453 employees for whom contributions have been filed by Air India with EPFO for December 2021.
New Delhi: Following the completion of the divestment process of national carrier Air India, the Employees’ Provident Fund Organisation (EPFO) has come on board with Tata Sons to provide social security benefits to the airline’s employees. The approval was granted on January 13 after Air India Ltd applied for voluntarily cover under the EPF and MP Act 1952, said the Ministry of Labour in an official statement.
The social security benefits will be provided to around 7,453 employees for whom contributions have been filed by Air India with EPFO for December 2021, the release said.
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Earlier on January 25, two provident-fund trusts at the Air India carrier sold an estimated Rs 4,500-5,000 crore of bond portfolio, including debt sold by states, the Centre and some corporates, following which the management of the corpus shifted to EPFO after the Tata Group takeover.
What benefits Air India employees are now entitled to?
- Now, the employees will be entitled to extra 2% employer’s contributions in their Provident Fund Accounts at 12% of their wages. Earlier they were covered under the PF Act of 1925, where the contributions to the Provident Fund was at 10% by employer and 10% by employee.
- According to the report, EPF Scheme 1952, EPS 1995 and EDLI 1976 will now be applicable to the Air India employees.
- The employees will get guaranteed minimum pension of Rs 1,000 and there will be provision for pensions to family and dependents in case of death of employee.
- Employees will also get an assured insurance benefit in case of death of member in the range of minimum Rs.2.50 Lakh and maximum 7 Lakhs.
- No premium is charged to the EPFO covered employees for this benefit.
According to the Mint report, since 1952-53, Air India and Indian Airlines were the two separate companies that were covered under PF Act 1925. In 2007, both the companies merged into one company — Air India Ltd. Therefore, under the PF Act 1925, the employees received the benefit of Provident Fund but there was no statutory pension scheme or insurance scheme, and the employees have to enrole in self-contributory annuity-based pension scheme. Based on the scheme parameters, the accumulations used to be paid to the employees. There was no minimum pension guarantee and no extra benefit in case of death of a member
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