Making EPF optional in a developing country

The Central government made EPF optional for certain made-up sectors to boost job prospects

The government has walked the path of making Employees’ Provident Fund (EPF) optional for certain sectors to boost employment.

“The Union Cabinet has given its approval to reforms to boost employment generation and exports in the made-up sector (a sub-sector of textiles and apparel)... making employees’ contribution to EPF optional for employees earning less than Rs 15,000 per month,” an official notification said. This basically means it is no longer compulsory for employees earning less than Rs 15,000 per month in such sectors to pay their 12 per cent contribution towards the Employee Provident Fund.

This is a significant departure