You are here: Home » Economy & Policy » News
Business Standard

Govt offers PF subsidies to employers in Atmanirbhar job incentive scheme

Sop available in the case of both, new hires and those who lost their jobs to Covid; Atmanirbhar Bharat Rozgar Yojana will benefit workers with wages up to Rs 15,000

Topics
Provident Fund | Nirmala Sitharaman | Finance Ministry

Somesh Jha  |  New Delhi 

construction, realty, workers, infra, jobs, migrants, labour, wage, real estate, concrete, cement, buildings, high rise, engineering

The National Democratic Alliance government on Thursday announced an employment generation scheme, offering subsidies to employers for hiring new workers and those who lost job during the ongoing COVID-19 pandemic.

The scheme, known as Atmanirbhar Bharat Rozgar Yojana, will benefit workers with wages up to Rs 15,000 who have been employed for the first time by an establishment covered by the Employees’ Organisation. Additionally, “EPF members drawing monthly wage of less than Rs 15,000 who made an exit from employment during COVID-19 pandemic from March 1, 2020 to September 30, 2020 and is employed on or after 1 October 2020” will also be a part of the scheme,” Finance Minister said here while announcing the next round of financial stimulus package.

“About 65 per cent of workers under the formal sector will be covered under the scheme,” the Finance Minister said.

Emplyoyers will have to add at least two new employees if they have total workforce of less than 50 and employers will have to hire a minimum of five new employees if their workforce if more than 50. The scheme will be in effect from 1 October 2020 and 30 June 2021, meaning new employment has to take place between this period.

“Establishments covered under the EPFO after the starting of the scheme to get subsidy for all employees,” the said.

Central government will give subsidy for two years for new employment from October 2020-June 2021, which will cover both employers’ and employees’ contribution towards the Employees’ scheme. It will be credited into Aadhaar-seeded EPFO account of eligible employees. It will cover all establishments with maximum of 1000 workers, which is equivalent to 95 per cent of all establishments in India. However, establishments with more than 1,000 workers will also be entitled for subsidy towards the employer’s share.

At present, both employers and employees contribute 12 per cent each of a worker’s wage towards schemes under the EPFO.

The employment generation scheme is somewhat similar to the Pradhan Mantri Rojgar Protsahan Yojana, launched in 2016 and which was in effect till 31 March, 2019 for companies to take benefit. Through the PMRPY, the Centre paid the employer’s share of workers’ contribution towards the PF for three years. The most important criterion of the scheme was that firms would get support only if they hired a worker who was not part of EPFO schemes in the past.

The PMRPY scheme had benefitted 12.2 million workers in 152,899 establishments till date. The government had given benefits to the tune of Rs 8,300 crore to firms, Sitharaman said.

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Thu, November 12 2020. 14:02 IST
RECOMMENDED FOR YOU
.