Historic judgement by Supreme Court to allow EPS members to apply for higher pension raised high hope among the eligible private sector employees. However, not many have been successful in getting the coveted higher EPS pension. Many employees who have applied for higher pension from the Employees’ Pension Scheme (EPS) are struggling as their joint option pension application has been either been rejected or not approved by their old employer(s). Due to rejection or not processing of pension application, many employees are not sure what they can do to get the application processed. Further, a good number of applicants are unaware what will happen if the pension application is not approved or not processed by the employer.
The Employees Provident Fund Organisation (EPFO) via its press release dated December 18, 2024, has given the last chance to the employers to upload wage details of employees by January 31, 2025. Further, employers are required to provide clarification requested by EPFO by January 15, 2025 to process the higher pension application.
ET Wealth online decodes what an employee can do now if their pension application is rejected or not approved by their old employer and how it can impact the pension they will receive at retirement.
What employees can do if their pension application is rejected by employers
Vaibhav Bhardwaj, Partner at Khaitan & Co says, “The EPFO has implemented certain safeguards regarding rejection of pension applications. An employer rejecting the application for higher pension has to provide the reasons. Such a rejection will be intimated to the applicant concerned. An employee whose pension application is rejected will get a chance to make the required corrections in the application or provide additional documents, as the case may be, within 1 month of issuance of the rejection letter. The action that an employee needs to take depends on the reason for rejection, if any. In case the employer has wrongly rejected the application, the employee may have to take it up with the concerned regional office. In the alternative, employees and pensioners can also use the EPFiGMS portal to register their grievances.”
Also Read : Axis Bank Credit Card Latest Rules Kick In From Today 20 December 2024 –Details You Need To Know
An employee must keep the track whether the employer (old and new) have rejected their application. Saraswathi Kasturirangan, Partner, Deloitte India says, “EPF members should keep track of any such communication from EPFO and take appropriate action after which the application will be reconsidered for processing. Once an EPF member provides the required information, the application will be again referred to the employer for review and approval.”
Will EPFO accept higher pension application if rejected by one or more employers?
Many employees may have worked with various employers and one of the old employers have rejected their pension application. If despite submitting the clarification, the pension application is rejected, then question arises how it will impact the employee.
Saraswathi says, “If the employer still rejects the application, then the EPFO will inform the member, and application will not be processed unless any clarification is provided by member to address rejection reason. Approval of joint option by all employers is a pre-requisite for processing of higher pension application. In the absence of some, EPFO may not be able to process higher pension application, and the member shall be entitled for pension only on the capped contributions. This would mean that an employee is not eligible to receive higher pension at the time of retirement.”
Concurring the view, Bhardwaj says, “In case the application has been wrongfully rejected, employees / EPF members can reach out to the regional office and seek their intervention or register their grievances with the EPFiGMS portal. All employers, past and present, have to approve the higher EPS applications of members. The higher EPS application will automatically be reflected in the employer’s login on the EPFO portal. The employer is required to verify the information submitted by the employee. If application for higher pension is rejected, and it is not rectified, then the employee will not be entitled to get higher pension.”
What employees can do if employer is yet to process the application
There may be some employers who are yet to process the higher pension application of the employees. All employers are required to process and approve the pension application so that employee can be eligible for higher pension.
Saraswathi says, “The employees should keep a track of the application status on the EPFO’s member Sewa portal. If the application is still not processed, they can reach to employer to understand the reason and request to take necessary action. Employee can also consider raising a grievance on EPFiGMS portal.”
The employers are now given final chance till January 31, 2025 to upload the wage details by the EPFO. This will help EPFO to process 3.1 lakh pending applications. Further, the EPFO has asked employers to submit clarifications by January 15, 2025 to further process the 4.66 lakh applications.
Saraswathi says, “Approval of joint option by all employers is a pre-requisite for processing of higher pension application. In the absence of same, EPFO may not be able to process higher pension application. The members may raise a grievance on EPFiGMS portal clarifying the reason which prevented filing of on-line application. In certain genuine scenarios like old employer not existing (due to amalgamation, merger etc.), then the current employer may have to take responsibility to share the wage details etc. for EPFO to process higher pension application.”
Bhardwaj says, “The EPFO will not be able to process the higher pension application unless the employer processes it first. Hence, there is not likely to be any modification in the original pension calculation unless and until the old employer approves it.”
