The Employees’ Provident Fund Organisation (Employees’ Provident Fund Organisation) has introduced stricter rules for private and government companies that manage their own provident fund (PF) trusts.
A new Standard Operating Procedure (SOP) was approved in a meeting of the Central Board of Trustees (CBT), chaired by Union Labour Minister Mansukh Mandaviya.
The main aim of these changes is to protect the savings of around 3.2 million employees, worth nearly â‚ą3.50 lakh crore, and improve their benefits and security.
New Rules for Private PF Trusts
Under the new system, more than 1,250 private PF trusts in India must ensure that their employee benefits are at least equal to or better than those provided by EPFO.
If any trust fails to follow these rules, its exempt status can be cancelled immediately.
Also, inactive and non-KYC accounts will now be transferred directly to EPFO along with interest.
Interest Rate Limit Introduced
A major change is the cap on interest rates offered by private trusts. Now, trusts cannot offer unlimited or extremely high returns.
They can only give up to 2% (200 basis points) more than the EPFO declared interest rate.
This step was taken because some companies were earlier offering very high interest rates (30–34%), which could create financial risks and imbalance in the system.
Digital Audits and Online Complaints
The new 133-page SOP also focuses on transparency and easier compliance.
Instead of mandatory physical inspections every year, the system will now follow a “risk-based digital audit” model. Only high-risk trusts will face detailed checks.
Every private PF trust must also set up an online grievance redressal system. This will be directly connected with EPFO, allowing employees to file complaints easily online.
Which Companies Will Be Affected?
Several major Indian companies that manage their own PF trusts will be affected by these rules. These include:
Tata Tea
Wipro
Infosys
Reliance Industries
Larsen & Toubro
TVS Motor
Raymond Limited
