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Kolkata: In a circular issued on Dec 17, the EPFO (Employees' Provident Fund Organisation) has clarified the rules around ELDI (Employee Deposit Linked Insurance) which will benefit the family members of any employee -- EPFO subscriber who expires -- who are going to claim the insurance benefits. The EPFO clarified that weekends or other holidays during job changes by an employee cannot be treated as a break in service.
According to EPFO, the pension regulator observed that many Employee Deposit Linked Insurance (EDLI) death claims were rejected or settled for a lower amount due to minor gaps or breaks in service. Moreover, officials did not make any proper assessment before the member's death during service. The EPFO also mentioned that Rs 50,000 will be the minimum payout amount.
Let us assume an employee has left a company on Friday and joined another company on Monday. In this case, Saturday and Sunday were considered a break in service, thus denying eligibility for EDLI benefits. EPFO has ruled that any Saturday, Sunday, or any weekly holiday, national holiday, gazetted holiday, state holiday, and restricted holidays declared in the previous or current establishment, falling after the period of continuous service, will be considered as part of continuous service, provided that only such holidays fall between the date of leaving one establishment and the date of joining the next establishment covered under the EPF & MP Act, 1952.
Saturday, Sunday, or any declared weekly holiday, national holiday, gazetted holiday, state holiday, and restricted holiday in the previous or current company will not be considered a break in service, and the service will be considered continuous, the EPFO circular issued on December 17 stated. Furthermore, a job change with a gap of up to 60 days will now be considered continuous service. This is going to be of big help to the survivours of those employees who have to claim EDLI.
The minimum payout benefit to any EDLI nominee has been raised to Rs 50,000. The EPFO has also increased the minimum payout benefit to dependents and legal heirs under the EDLI scheme to Rs 50,000, even if the member has not completed 12 months of continuous service. This benefit will be provided even if the member's average EPF balance is less than Rs 50,000. The minimum EDLI payout will also be applicable if the member dies within six months of their last PF contribution, provided they are still on the company's payroll.
