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By:

Sumit Ranjan Das

21 August 2024 at 4:08:59 pm

EPFO’s Big Wage-Band Reset

Twelve years is a long time for a wage ceiling to remain unchanged. The last revision came in September 2014, when the limit was raised from Rs.6,500 to Rs.15,000. Last week, the Union Cabinet approved another increase, taking the ceiling to Rs.25,000 a month with effect from 17 September 2026. The government’s estimate is that more than 51 lakh additional employees will come within mandatory EPFO coverage as a result of the change. For employers and payroll professionals, however, the...

EPFO’s Big Wage-Band Reset

Twelve years is a long time for a wage ceiling to remain unchanged. The last revision came in September 2014, when the limit was raised from Rs.6,500 to Rs.15,000. Last week, the Union Cabinet approved another increase, taking the ceiling to Rs.25,000 a month with effect from 17 September 2026. The government’s estimate is that more than 51 lakh additional employees will come within mandatory EPFO coverage as a result of the change. For employers and payroll professionals, however, the headline number is only the starting point. The more important questions are who will be covered, which wages will be taken into account and how the revised provisions will be implemented. Wage Ceiling The existing wage ceiling of Rs.15,000 a month is being raised by Rs.10,000, or 66.7 percent, to Rs.25,000. The change takes effect from 17 September 2026 and marks the first revision since September 2014. The government expects more than 51 lakh additional employees to be covered. Estimated expenditure is about Rs.56,696 crore over five years, while annual government outgo is expected to rise to approximately Rs.11,339 crore. The standard contribution remains 12 percent each from the employee and employer, subject to applicable provisions. The Cabinet said the decision will expand access to provident-fund savings, pension protection under the Employees’ Pension Scheme (EPS) and insurance protection under the Employees’ Deposit Linked Insurance Scheme (EDLI), in accordance with the applicable scheme provisions. The wage ceiling is not merely an administrative threshold. It determines the point at which mandatory EPF coverage applies under the existing framework. At present, a fresh employee joining employment at wages above Rs.15,000 a month is not automatically brought within mandatory EPF coverage and may remain outside mandatory provident-fund, pension and associated insurance protection, subject to applicable statutory provisions. The revised ceiling will bring a substantial section of employees earning between Rs.15,000 and Rs.25,000 within the mandatory coverage framework. The government has also quantified the fiscal impact. The estimated expenditure is about Rs.56,696 crore over five years, while annual government outgo is expected to rise to approximately Rs.11,339 crore, compared with existing annual budgetary support of about Rs.10,250 crore. The Labour Ministry has linked the revision to sustained wage growth, rising incomes and the continued expansion of formal employment since the previous revision in 2014. Payroll Illustration Consider an employee earning Rs.22,000 a month who becomes subject to mandatory coverage under the revised ceiling. At the standard 12 percent contribution rate, if the full eligible wage is used as the contribution base, the employee’s contribution would rise from Rs.1,800 to Rs.2,640 a month, while the employer’s contribution would similarly rise from Rs.1,800 to Rs.2,640. Total monthly contributions would therefore increase from Rs.3,600 to Rs.5,280 — a combined increase of Rs.1,680. However, this should not be treated simply as Rs.1,680 of additional employee savings. Contributions are allocated between EPF and EPS components as prescribed, with the EPF component accumulating in the employee’s account and the EPS component providing pension benefits subject to scheme conditions. The Rs.22,000 example is illustrative, not a universal payroll formula. The final treatment of wage components, existing employees in this band, EPS allocation and transitional matters will depend on the statutory notification and EPFO implementation instructions. For payroll professionals, the immediate task is to assess the operational impact. Key questions include the effective date for existing employees and new joiners, which wage components will count towards PF, whether the 10 percent concessional rate for notified establishments will continue, how the revised ceiling will interact with EPS pensionable wages, and what changes will be required in payroll systems. The Cabinet approval establishes the policy decision; the formal Gazette notification and EPFO instructions will determine how it is translated into payroll processes. The revised ceiling is the first increase since September 2014 and is expected to bring more than 51 lakh additional employees, particularly those in the Rs.15,000-Rs.25,000 wage band, under mandatory EPFO coverage. For them, the change can expand access to provident-fund savings, EPS pension and EDLI insurance, subject to scheme provisions. For employers, it means reviewing payroll costs, employee data, eligible wage components, contribution calculations and compliance systems. The government has described the move as part of efforts to extend statutory social security and strengthen formal employment. The policy has been announced. For payroll professionals, the next chapter is implementation. (The writer is a Cost and Management Accountant and founder of TaxoDas. Views personal

Malayalam Cinema Caught in the Crosshairs

Writer: R Ramanand
R Ramanand
Sep 8, 2024
3 min read

Updated: Oct 21, 2024

Malayalam Cinema Caught in the Crosshairs

Malayalam cinema has long served as a vibrant mirror to Kerala’s society, deeply intertwined with the daily lives of Malayalis. The film industry’s actors are cherished figures across the globe, akin to family members. Thus, when the Hema Committee report shook the industry, the repercussions extended far beyond cinema enthusiasts, affecting the entire Kerala community.

The controversy traces back to 2017, when a leading actress was assaulted by a group of assailants, implicating a prominent actor. This incident spurred the formation of the Women in Cinema Collective (WCC), which petitioned the Kerala government to address systemic issues facing women in the industry. In response, then-Chief Minister Pinarayi Vijayan established a committee led by retired Justice Hema, with veteran actress Sarada and retired IAS officer K. B. Valsala Kumari. The committee was tasked with investigating these concerns.

The Hema Committee submitted its report on December 31, 2019, but it remained unpublished, with no concrete action taken by the government throughout Vijayan’s tenure until July 2024. Following a State Information Commission order on July 6, the Kerala government was directed to release the report, redacting sensitive details. By August 19, 2024, only 233 pages of the report were made public, with several key sections withheld.

The release of the report has led to a flurry of new allegations, including claims against prominent actors such as Jayasurya, Mukesh (a CPIM MLA), Idavela Babu, and Baburaj.

Jayasurya, a self-made star of Malayalam cinema, faces accusations from two complainants alleging that he attempted to hold and kiss them without consent. Allegations against Jayasurya surfaced just as he was tasting success, winning the Kerala State Film Award for Best Actor and had a major project lined up which purports to be one of South India’s most expensive films to date.

These accusations have overshadowed serious issues like the role of the drug mafia in the Malayalam film industry, underplayed by the Hema Committee. The intense focus on Jayasurya, who is independent and unaffiliated with influential lobbies, has fuelled speculation about ulterior motives.

Unlike others, Jayasurya’s independence from influential lobbies and his spiritual beliefs may have made him a target. Media scrutiny and a coordinated smear campaign, including branding him as a ‘toilet star’ suggest an orchestrated effort to tarnish his reputation. This disproportionate focus on him raises questions about possible ulterior motives or media sensationalism.

A long-standing rape allegation against veteran actor Siddique has resurfaced, while new accusations against filmmaker Ranjith—alleging homosexual assault and the dissemination of compromising photos—have emerged. In response, the government has formed a seven-member special investigation team, and the leadership of the Malayalam film actors association (A.M.M.A.), led by Mohanlal, has resigned amid growing scrutiny.

The women’s wing of Jamaat-e-Islami quickly called for a thorough investigation and urged young male stars to take a stand, suggesting an orchestrated effort behind the scenes. The focus on Jayasurya, a celebrated actor with no ties to influential lobbies, has raised questions. The media’s disproportionate attention to his case, overshadowing other serious issues such as the drug mafia’s influence, hints at a potential ulterior motive. Jayasurya’s independence and spiritual beliefs may have made him a target in a broader scheme to discredit him.

This crisis appears to be part of a larger agenda to control Malayalam cinema, with actor Mohanlal—known for his nationalist leanings—emerging as a significant obstacle. The ongoing smear campaign against Mohanlal, alongside new allegations against various actors including Jayasurya, appears part of a broader strategy to undermine his influence and dismantle his support network.

This turmoil seems to echo tactics used in the Jasmine Revolution and other uprisings, combining issues like sexual assault, gender discrimination, and corruption to create widespread unrest. Recent allegations against ADGP Ajithkumar, a close ally of Chief Minister Pinarayi Vijayan, further suggest an orchestrated effort to destabilize state institutions and public trust.

This unfolding crisis should be seen not as isolated incidents but as a deliberate effort to provoke societal discord and shift power dynamics within the industry and beyond.

The turmoil within the Malayalam film industry may be a precursor to a larger upheaval reminiscent of the Jasmine Revolution and other recent uprisings. Allegations against high-profile figures and the timing of these accusations suggest a coordinated attempt to undermine public trust in Kerala’s institutions and government.

This scenario calls for heightened vigilance and a serious response to prevent the destabilization seen in other regions.

Kerala, like the rest of India, must guard against these destabilizing tactics. The central government must address the drug mafia’s influence in the Malayalam film industry and halt radical Islamization to ensure a safe, secular, and dignified work environment for all professionals.

(The writer is a journalist and script writer, based in Kochi, Kerala. Views personal)

 
 
 

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