Pradhan Mantri Rojgar Protsahan Yojana

February 8, 2020
SEBI Grade A Test Series

Pradhan Mantri Rojgar Protsahan Yojana (PMRPY) is a flagship employment generation scheme which was announced on August 07, 2016. Under the scheme, Government is paying full employers’ contribution of 12% (towards Employees’ Provident Fund and Employees’ Pension Scheme both), for a period of 3 years in respect of new employees who have been registered with the EPFO on or after 1st April 2016

Pradhan Mantri Rojgar Protsahan Yojana

Features of Pradhan Mantri Rojgar Protsahan Yojana

  • Employees with salary up to Rs. 15,000 per month and who have worked for 240 days in an establishment.
  • About 3.5 lakh establishments which hire more than 20 workers are covered under this scheme.
  • Government of India will pay the full employer’s contribution (EPF and EPS both) as admissible from time to time w.e.f 01.04.2018 for a period of three years to the new employees and to the existing beneficiaries for their remaining period  of three years through EPFO.
  • The terminal date for registration of beneficiary through establishment is 31’st March,2019.
  • The entire system is online and AADHAR based with no human interface in the implementation of the scheme.

Eligibility under PMRPY

  • All establishments registered with Employees’ Provident Fund Organisation (EPFO) can apply for availing benefits under the scheme.
  • Establishments registered with the Employees’ Provident Fund Organisation (EPFO) should also have a Labour Identification Number (LIN) allotted to them under the Shram Suvidha Portal (https://shramsuvidha.gov.in). The LIN will be the primary reference number for all communication to be made under the PMRPY Scheme.
  • The PMRPY scheme is targeted for employees earning wages less than Rs 15,000/- per month. Thus, new employees earning wages more than Rs 15,000/- per month will not be eligible. A new employee is one who has not been working in an EPFO registered establishment on a regular basis prior to 01st April, 2016 and will be determined by the allocation of a new Aadhaar seeded Universal Account Number (UAN) on or after 01.04.2016. In case the new employee does not have a new UAN, the employer will facilitate this through the EPFO portal.
  • The employers will continue to get the 8.33% contribution paid by the Government for these eligible new employees for the next 3 years, provided they continue in employment by the same employer. The 8.33% contribution will be paid by GOI after the employer has remitted the 3.67% EPF contribution for these new employees each month.

Benefits of PMRPY

  • The employer is incentivised for increasing the employment base of workers in the establishment.
  • A large number of workers will find jobs in such establishments.
  • A direct benefit is that these workers will have access to social security benefits of the organized sector.
  • The employers are also eligible to get the 3.67% EPF contribution paid by the Government. This benefit can be availed of by the textile (apparel) sector establishments dealing with the Manufacture of wearing apparel, in particular NIC Codes 1410 and 1430. The Government, in this case, will also pay the EPF contribution of 3.67% in addition to paying the EPS contribution of 8.33%. The payment of 8.33% EPS and 3.67% EPF by the Government will be made after the employer has credited the 12% EPF contribution of the employees with EPFO.

Implementing Agency of PMRPY

It is being implemented by Ministry of Labour and Employment through the Employees’ Provident Fund Organization (EPFO).

Progress of PMRPY

  • Pradhan Mantri Rojgar Protsahan Yojana (PMRPY) has crossed the milestone of one crore beneficiaries as on January 14, 2019.
  • Government has found 9 lakh beneficiaries in as many as 80,000 companies took benefit of Pradhan Mantri Rojgar Protsahan Yojana (PMRPY), even though they were not eligible, leading to around Rs 300 crore loss to the exchequer. These companies allegedly duped the system by taking financial incentives meant to bring new employees in the formal economy

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