Home / Business and Economy / New SOP Mandates Equal or Better Benefits for Trust Employees
New SOP Mandates Equal or Better Benefits for Trust Employees
12 May
Summary
- Private trusts must offer benefits equal to or better than EPFO.
- Non-compliance leads to exemption status cancellation.
- Private trusts' interest payouts capped at 2% above EPFO rate.
A new, consolidated Standard Operating Procedure (SOP) has been approved for private provident fund trusts, ensuring employees receive benefits equal to or better than those provided by the Employees' Provident Fund Organisation (EPFO). This measure affects over 1,250 trusts managing approximately ₹3.50 lakh crore for nearly 3.2 million employees.
Failure to comply with the new regulations will result in the cancellation of exemption status for these private trusts. Additionally, private trusts are now limited to offering interest rates no more than 2% above the EPFO's rate, a move aimed at preventing excessive payouts seen in some public sector companies.
The comprehensive 133-page SOP streamlines processes for exemption, reduces documentation, and enhances transparency through a technology-driven approach. It also mandates online grievance resolution portals for private trusts, integrated with the EPFO system to protect employee interests.
