The Government is taking many steps to boost economy and increase employments, to decrease the impact of Covid-19 on economy. One such step is Atmanirbhar Bharat Rozgar Yojana. Under this scheme Govt will provide subsidy towards Provident Fund Contribution for adding new employees to establishment registered with EPFO (Employees’ Provident Fund Organisation)
1. The scheme is available for all those workers who lost job between 1st March 2020 to 30th September 2020 and for new workers employed after 1st October 2020
2. Subsidy available for workers with wages upto Rs. 15,000 per month
Which means if any establishments hire new employees on or after 1st October 2020 either a person who had lost job between 1st March 2020 to 30th September 2020 or any new employees who has never registered with EPFO, such establishments get this benefit.
The establishments get the benefit only if below conditions satisfied
Establishment with <=50 employees – minimum 2 employees to be hired
Establishment with > 50 employees – minimum 5 employees to be hired
(Reference for employee base is as on 30th Sep 2020)
The subsidy amount under the scheme, which will be operational till June 30, 2021, will be credited upfront only in Aadhaar-seeded EPFO accounts (UAN) of new employees.
New/Eligible employees employed between 1st October 2020 to 30th June 2021 will be eligible for the benefit
The benefit is available for a period of Two years from the date of their employment during the above mentioned period.
Establishments employing upto 1000 employees – 24% of PF contribution which is both employer and employee contribution shall be borne by Govt
Establishments employing more than 1000 employees – Employee contribution of 12% shall be borne by Govt
1. Only 2 slab of <50 and >50 may offer huge variation. Probably considering few more slabs would have benefit the establishments better
2. The scheme limiting salary to Rs. 15,000 will benefit the low/semi skilled employees but not high skilled employees
Overall it’s a good move by the Govt to boost the employment after the pandemic. Establishments, who have reduced the manpower due to cost burden may look back at hiring since 12 to 24% of cost would be subsidized by the Govt
Also routing the benefit through EPFO account instead of direct benefit has structured the scheme easy, simple and transparent