Sachdev, who is also All India Trade Union Congress Secretary, said unions are concerned that approving budget proposal may dilute the social security law in the country.
Trade unions and even some employers' representatives today opposed EPFO-related budget proposals on concerns that those may dilute social security laws, union leader D L Sachdev said.
The budget proposals were discussed in the Employees' Provident Fund Organisation's apex decision making body, the Central Board of Trustees (CBT), which is headed by the Labour Minister.
"All unionists, even some employers' representatives in the CBT opposed budget proposals. Labour Minister Bandaru Dattatreya has assured us that he will apprise the Finance Minister of the outcome of today's meeting," Sachdev, who is also a CBT member, told PTI.
Finance Minister Arun Jaitely in Budget 2015-16 had proposed creation of a Senior Citizen Welfare Fund using unclaimed deposits of about Rs 3,000 crore in the PPF (Public Provident Fund) and Rs 6,000 crore in the EPF corpus.
This corpus will be used to subsidise the premiums of vulnerable groups such as old age pensioners, BPL card holders, small and marginal farmers and others.
Unions opposed using retirement fund body EPFO's money for other schemes, the proposal to make it optional for workers to pay PF contribution. They also opposed the proposed freedom to employees to choose between social security schemes run by EFPO and others.
Sachdev, who is also All India Trade Union Congress Secretary, said unions are concerned that approving budget proposal may dilute the social security law in the country.
The unions also opposed the Finance Ministry's new investment pattern for non-government pension funds, which prescribed investing 5-15 per cent of corpus in equity or equity linked investments.
Sachdev said that the new investment pattern has been referred to EPFO's advisory body, the Finance Audit and Investment Committee, for examination.
As part of his Budget speech, Jaitley had announced that options like exemption from PF contributions for certain workers and allowing all members to choose between EPFO schemes and other schemes would be provided.
"... For employees below a certain threshold of monthly income, contribution to EPF should be optional, without affecting or reducing the employer's contribution," he had said in the Budget speech.
The Budget proposals, however, did not specify the salary threshold for this.
At present, all employees are required to pay 12 per cent of basic wages, including basic salary and DA, as contribution to the PF.
The employers make a matching contribution, with 8.33 per cent going towards pension, 0.5 per cent towards Employees Deposit Linked Insurance (EDLI) scheme and remaining towards provident fund.
Jaitley had also said that employees would get to choose between EPF scheme run by retirement fund body EPFO and the New Pension Scheme (NPS) as also between health insurance products and Employees State Insurance Corporation's (ESIC) health cover.
"With respect to the EPF, the employee needs to be provided two options. Firstly, the employee may opt for EPF or the New Pension Scheme (NPS)," Jaitley had said.
He had said the government intended to amend legislation in this regard after consultation with stakeholders.
At present, over 5 crore workers are covered by mandatory social security schemes run by EPFO.
The Employees Provident Fund Organisation (EPFO) manages a corpus of Rs 6.5 lakh crore.
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