After Tata group's takeover of the state-owned Air India, the Employees' Provident Fund Organisation (EPFO) has onboarded the airline for social security coverage to provide the social security benefits to its employees. The approval was granted on January 13 after Air India Ltd applied for voluntarily cover under the EPF & MP Act 1952.
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.
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The employees of Air India now will be entitled to following benefits:
1) The employees will receive 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.
2) EPF Scheme 1952, EPS 1995 and EDLI 1976 will now be applicable to the employees.
3) A guaranteed minimum pension of ₹1,000/- will be available to employees and pensions to family and dependents in case of death of employee.
4) An assured insurance benefit in case of death of member will be available 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.
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.
Under the PF Act 1925, the benefit of Provident Fund was available but there was no statutory pension scheme or insurance scheme. The employees used to participate 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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