International Workers joining on or after 1 September 2014 not covered under the Pension Scheme

 

This is a follow up to our previous  Alert dated 28 August 2014 on the amendments to the Indian social security schemes (Provident Fund Scheme, Pension Scheme and Deposit Linked Insurance Scheme). These amendments are effective 1 September 2014.

Under the amended Pension Scheme, an employee who is not an existing member of the Pension Scheme will not be eligible to become member of the Pension Scheme if his / her monthly salary exceeds INR 15,000 (USD 208).

This amendment is also applicable for International Workers.

Thus, an International Worker assigned to India on or after 1 September 2014 will only be required to become member of the Provident Fund Scheme and will not be required to become member of the Pension Scheme. For such an International Worker, the entire employer and employee share of contributions (24% of monthly salary) will be allocated to the Provident Fund Scheme.