A secured minimum pension of ₹ 1,000 per month will be open to employees and pensions to family and dependents in case of death of employee
Employees’ Provident Fund Organisation
Air India as a government institution was covered under the PF Act of 1925 where the contributions to the provident fund were at 10% by the employer and 10% by the employees.
About 7,453 employees of Air India will welcome an extra 2% employer’s contributions in the provident fund accounts at 12% of their wages as the Employees’ Provident Fund Organisation (EPFO) has onboarded Air India for the social security coverage.
Air India had applied for voluntarily covered u/s 1(4) of the EPF and MP Act 1952 which has been allowed through a gazette notification dated January 13 with the effect from December 1, 2021.
Earlier, the employees were covered under the PF Act of 1925, like all government institutions, where the assistance to the provident fund were at 10% by the employer and 10% by the employee.
Under the EPF Act which is now covering Air India, a guaranteed minimum pension of ₹1,000 will be available to employees and to family and dependents in case of death of an employee. An assured insurance benefit in case of death of a member will be known in the range of minimum ₹2.50 Lakh and a maximum ₹7 Lakh. No premium is charged to the EPFO covered employees for this benefit.
Air India and Indian Airlines
“Since 1952-53, Air India and Indian Airlines were the two individual companies that were covered under PF Act 1925. In 2007, both the companies merged into one company- Air India Ltd.
Under the PF Act 1925, the benefit of Provident Fund was available but there was no statutory assistance plan or insurance Scheme. The employees operated to participate in self-contributory annuity-based pension scheme.
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Based on the scheme parameters, the accumulations utilized to be paid to the employees. There was no minimum pension guarantee and no extra advantage in case of death of a member,” a report of the ministry of labour and work told.
Air India has officially been handed over to the Tata Group after all formalities of the divestment process was achieved on January 27.
Earlier, it was clarified that the current employees of Air India will be retained for a year and there will be no layoffs. In the second year, if old employees are sacked then that will be considered as paid VRS.
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