Supreme Court clears decks for employees to get higher pension on actual Salary- Basic plus DAAs per the Employees Provident fund Pension Scheme 1995, the wages for contribution and for calculation of Pension is limited to Rs.15,000/-. In other words , if the salary of a person [Basic+da] is say Rs. 60, 000/- per months for the calculation of pension same is restricted to Rs.15,000/-.
Now Hon'ble Supreme in its judgment upheld the judgments of Kerala High Court which allowed pension on actual Salary. Hon'ble Supreme Court in its order passed yesterday, dismissed the Special Leave Petition filed by EPFO against Kerala High Court Judgment.
With the above judgment many employees of both Government and Private Sector employees are eligible to get higher pension.
Following is the method of calculation.
Example: Salary - Basic+DA- Rs.50,000- Service - 30 Years.
Existing pension: Salary limited to Rs. 15,000x30/70 = Rs.6428
New pension: Salary Rs.50000 - Rs.50000x30/70 = Rs.21,428
However, employees will be required to refund the difference of recovery on actual Salary from 1995 to EPFO to become eligible for revised pension.