The Pradhan Mantri Rojgar Protsahan Yojana – Key Facts

Among the various initiatives that have been seen recently, the PMRPY has been among the most discussed – for the opportunity that it allows and also for the change that it expects to bring about. However, there has also been a lot of ambivalence accompanying it, much of it stemming from ambiguity in understanding its scope and extent. Through this note, we attempt to deconstruct the PMRPY and help make it simpler and more inclusive.

Purpose

The main objective of PMRPY is to help generate greater employment, with the Government of India making a contribution of 8.33% EPS on behalf of the company for the new employee.

Eligibility

Establishments with a valid organisational PAN qualify. All payments will be made to the establishment through a bank account. Additionally, the establishment must also have a Labour Identification Number (LIN) which is assigned upon registry with the Shram Suvidha Portal. This is applicable only to establishments who are already registered with the EPFO.

In order to avail this benefit, the establishment needs to add the new employees to the reference base of workers. The Scheme has been in operation since August 2016.

Reference Base

It is mandatory that the establishment have submitted their ECR for March, 2016. The reference base is simply the number of employees for whom the establishment deposited the EPF and EPS, together amounting to 12%, on or before 31^st March 2016. The details will be verified.

Determining benefits

In order to be eligible for the benefits, the establishment needs to show an increase in the number of employees on or after 1^st April, 2016. The benefits, however, will only be available to the new employees. Using the same reference base and 31^st March cut off, a calculation of new employees will be made every subsequent year.

In the event that there has been no new employment, or the establishment has witnessed a fall in employment in the subsequent months, they will not be eligible for the scheme during those months.

For new establishments, or establishments that register with the EPFO after 1^st April 2016, the reference base is zero, with every employee being considered new.

New Employee

Under this scheme, a new employee is defined as one:

-        Who did not have a UAN prior to 1^st April 2016 (all UAN’s must be Aadhar seeded and verified)

-        Has not worked with an EPFO registered organisation prior to 1^st April 2016; and

-        Whose wages do not exceed Rs. 15,000 per month in either the unskilled or semi-skilled category.

Extent of Validity

The Scheme will be operational for 3 years, and will cover all new employees until such time, provided that the new employee continues to be in employment under the same employer.

Process for Availing the Benefit

Upon registry, the following procedure must be followed on a monthly basis

-        Using the PMRPY form, the establishment must update the PMRPY interface, on or before the 10^th of every month. This form includes a description of the job role, date of joining and date of exit if applicable.

-        The form must be submitted by the 10^th of each month. In the event that the form is not submitted online before the stipulated time, the employer will not be able to avail the benefits for the said month.

-        Using the prescribed format, an undertaking must be filled and duly signed by the employer.

-        Details of the new employee – like the UAN, its seeding with the Aadhar number etc. will be validated and verified. After this, the amount due against the new employee will be computed.

-        Until such time that ECR 2.0 is in operation, contributions will be made directly into the account of the employer.

In case multiple ECR’s have been filed by an establishment for the same period, only the first ECR filed and submitted for the month by the employer would be considered.

Supplementary ECR’s

If a supplementary ECR is filed by the employer for the base month at a later stage, which leads to a strengthening of the employee number in the base month, there is a chance that the employer may become ineligible for the benefits during some, or all months, for which the contribution has already been made. In this case, the employer must refund the subsidy received for those months, along with penal provisions which have been laid down in the EPF & Miscellaneous Provisions Act, 1952 and Schemes thereunder.

NIC – 2008

To avail benefits, it is compulsory for the establishment to mention the nature of industry as per the National Industrial Classification Code or NIC-2008. This code is assessed by the value of products, services and activities carried out by the establishment. For establishments that produce multiple products, the product which contributes maximum value is taken. Where such classification is not possible, the revenue of the establishment, services or the number of people deployed in the activity may be considered.

Benefit to Textile Industry

A parallel scheme known as the Pradhan Mantri Paridhan Rojgar Protsahan Yojana is targeted at the textile industry, wherein the employers can also avail the 3.67% EPF contribution, over and above the 8.33% contribution. The payment will be made after the employer has credited the employees’ 12% EPF contribution with the EPFO. This is particularly in favour of establishments dealing in the manufacture of wearing apparel (NIC 1410 and 1430).

Sub-Sectors covered in the apparel sector

(1) NIC 1410: Manufacture of wearing apparel, except fur apparel

a. NIC 14101: Manufacture of all types of textile garments and clothing accessories 

b. NIC 14102: Manufacture of rain coats of waterproof textile fabrics or plastic sheetings

c. NIC 14105: Custom tailoring

d. NIC 14109: Manufacture of wearing apparel not elsewhere classified

(2) NIC 1430: Manufacture of knitted and crocheted apparel

a. NIC 14301: Manufacture of knitted or crocheted wearing apparel and other made-up articles directly into shape (pullovers, cardigans, jerseys, waistcoats and similar articles) 

b. NIC 14309: Manufacture of other knitted and crocheted apparel including hosiery

Availing PMRPY Benefits

Given below are the steps that should help you to avail the benefits under the Pradhan Mantri Rojgar Protsahan Yojana

1.      Login to the Employer Interface of the EPFO Unified Portal

2.      Details of all new employees along with Aadhaar information is to be filled for the relevant month. This can be done either individually or through bulk registrations

3.      UAN’s to be allotted to new members, and the Aadhaar information must be approved by the employer through the DSC

4.      The employer then needs to login to the PMPRY portal (https://www.pmrpy.gov.in)

5.      Details of new members who have joined and are eligible will now be added. The return will be signed digitally. This activity must be completed and submitted either before the 10^th of the following month, or before submitting the ECR for the month, whichever is earlier. It is only on fulfilling this condition that the contribution will be released.

Sr. No	Field	Field Type
1	UAN	Input
2	Member’s Name	Display/Non Editable
3	Father/Husband’s Name	Display/Non Editable
4	Aadhaar	Display/Non Editable
5	Date of Birth	Display/Non Editable
6	Date of Joining	Display/Non Editable
7	Date of Exit	Display/Non Editable
8	Job Description	Selection
9	Skill Level	Selection

6.      Employer logs in to the Employer Interface of EPFO’s unified portal.

7.      Employer files the ECR copy as is – without any changes under the PMRPY Scheme. The system uses step 5 to ascertain whether the benefit is to be extended or not.

8.      A Challan is generated by the system after adjusting the amount payable under the PMRPY.

9.      The system then begins the procedure for remittance of dues excluding the subsidy allowed under the PMRPY, as determined by the Challan described in step 8.