Three judges declared the provisions of the notification dated August 22, 2014, legitimate by a bench led by CJI...
Digital Desk: The Supreme Court on Friday affirmed the constitutionality of the 2014 Employees’ Pension (Amendment) Scheme even as it read down several of its clauses to make it beneficial to employees.
A three-judge Bench led by CJI UU Lalit declared the terms of the notification dated August 22, 2014, as legitimate.
However, it toned down some of the restrictions by allowing in-service employees to avail the advantage of the option under EPS, which empowers the employer and employees to make an uncapped pension contribution.
The Bench — which also included Justice Aniruddha Bose and Justice Sudhanshu Dhulia — ruled that exempted and un-exempted enterprises have to be considered equally for EPS.
According to the amendment to the pension programme, excluded establishments would be treated the same as regular establishments.
"What we have directed for exempted will apply to regular as well," Judge Bose stated as he delivered the ruling.
The detailed verdict is scheduled to be posted on the website of the Supreme Court by Friday evening.
The ruling came on appeals filed by the Employees' Provident Fund Organisation against a decision of the Kerala High Court setting aside changes to the Employees Pension Scheme (EPS) of 1995 on the "calculation of pensionable wage."
The EPFO has said that if the Kerala High Court ruling was allowed to stand, the EPS would "completely collapse."
The Bench ruled those fund members who did not exercise their option before 2014 would be eligible to do so.
Concerning the post-adoption scheme, the Supreme Court stated that those employees who did not exercise their option due to a lack of clarification should be given further time to do so. For this goal, it extended the deadline by four months.
Employees who resigned before the 2014 scheme, on the other hand, would not profit from the ruling. Those who retired after the 2014 programme after exercising their option would be eligible for the scheme, it stated.
"We have suspended a portion of our order for six months so that authorities can create the cash, and any revision, etc, is up to the framer of law," the Bench added.
"We see no problem with modifying the foundation for calculating the computed salary for such purposes." The contempt petitions have been dismissed. All appeals are granted, and verdicts are amended as a result. Employee petitions were also dismissed," it stated.
The system set the maximum pensionable wage at Rs 15,000 and imposed a surcharge on contributions that exceeded this limit.
The entire discussion revolves around the adjustments implemented to Clause 11(3) of the EPS-1995.
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