EPF to ensure savings for contract and daily wage workers under MGNREGA scheme

Kottayam: Workers employed on a contract or daily wage basis under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in Kerala will now be eligible for Employees' Provident Fund (EPF) benefits. The Local Self-Government Department announced the inclusion of these workers at village, block, district, and state levels, subject to specific conditions.

As per EPF rules, employees earning up to Rs 15,000 per month are required to be made members. Currently, contract workers under the MGNREGA have a minimum salary of Rs 24,040, so they will be included in the scheme based on their application. However, temporary employees earning up to Rs 15,000 monthly will mandatorily be included in the scheme.

Temporary employees earning Rs 15,000 or more will need to contribute Rs 1,800 (12% of Rs 15,000) towards EPF, while the employer’s share will be Rs 1,950 (13% of Rs 15,000). Local bodies or relevant district and state authorities must register as employers on the Shram Suvidha portal and ensure the total contributions are deposited into the PF fund by the 15th of every month.

The administrative expenses for the employment guarantee scheme are entirely funded by the central government, but there are often delays in receiving the funds. To address this, gram and block panchayats have been directed to make payments from their own funds and reimburse them once the central funds are disbursed.

The key advantage of this initiative is ensuring savings for employees, as EPF contributions cannot be withdrawn easily. However, in emergencies, funds can be withdrawn under certain conditions. Employees can withdraw 75% of the EPF balance after one month of leaving the job, and the remaining 25% after two months of unemployment.