Section 6A of EPF Act 1952 - Employees' Pension Scheme

Sub-section (1): Power to frame the Pension Scheme

The Central Government may, by notification in the Official Gazette, frame the Employees' Pension Scheme to provide for:

1. superannuation pension, retiring pension or permanent total disablement pension for employees of establishments or classes of establishments to which the Act applies; and
2. widow or widower's pension, children pension or orphan pension payable to beneficiaries of such employees.

Sub-section (2): Establishment and funding of the Pension Fund

Notwithstanding Section 6, a Pension Fund is to be established after the Pension Scheme is framed. In respect of every employee who is a member of the Pension Scheme, the Fund receives:

1. sums out of the employer's contribution under Section 6, not exceeding 8.33 percent of basic wages, dearness allowance and retaining allowance, if any, as specified in the Pension Scheme;
2. sums payable by employers of exempted establishments under Section 17(6);
3. the net assets of the former Employees' Family Pension Fund as on the establishment of the Pension Fund; and
4. sums specified by the Central Government after due appropriation by Parliament.

For members covered by the higher-pension option, later notified provisions may affect the employer-side diversion on wages above the statutory ceiling. The applicable EPS provisions and EPFO directions should therefore be checked for the member's category.

Sub-section (3): Transfer from the former Family Pension Scheme

On establishment of the Pension Fund, the former Family Pension Scheme ceased to operate. Its assets stood transferred to the Pension Fund, its liabilities became enforceable against that Fund, and beneficiaries of the ceased scheme became entitled to benefits not less than those available to them under that scheme.

Sub-section (4): Administration

The Pension Fund vests in and is administered by the Central Board in the manner specified in the Pension Scheme.

Sub-section (5): Matters covered by the Scheme

Subject to the Act, the Pension Scheme may provide for all or any matters specified in Schedule III of the Act.

Sub-section (6): Prospective or retrospective operation

The Pension Scheme may provide that all or any of its provisions take effect prospectively or retrospectively from the date specified in the Scheme.

Sub-section (7): Laying before Parliament

A Pension Scheme framed under Section 6A(1) must be laid before each House of Parliament for the statutory period. Parliament may agree to modify or annul the Scheme, without prejudicing the validity of anything previously done under it.