EPFO Pension Rules 2025 : If one is with a company for 10 years continuously, then according to the EPFO rules, one would be eligible for a pension under the Employee Pension Scheme (EPS) after retirement. But what if someone worked for 4 years, lost their job, and spent 2 or 3 years searching for a new one? In what way will their total working years be counted for pension eligibility?
The EPFO rules state that if someone is in a company for a continuous period of 10 years, that person becomes entitled to a pension at retirement age under the Employee Pension Scheme EPS. What if someone worked for 4 years and after that lost his job and took two or three years looking for a new one? How would his total working counts be taken toward his pension eligibility?
Another question that pops in the mind of an employee is whether the work experience would be counted from scratch for the new employment, or would the previous work period be added to the new one while ignoring the gap? Let’s understand the principles firmly so that there will not be any ambiguity.
What Happens After A Long Career Gap? Know The Impact
Not having to fret if you quit one job and take a long while before getting into another. Whenever you take a new job, make sure you use the same UAN (Universal Account Number) allotted to you in the previous company. Your new employer would transfer EPF contributions to the same account. The total service period from your previous employment would be added to the present employment. Thus, your work should not again be made to complete the lesser target of 10 years in order to avail of pension benefits.
Example With Explanation
For example, if an employee has worked in a company for five years and falls into the employment without it for one year then again gets into it, this would not waste any previous services. If they continue with the same UAN (Universal Account Number) in the new employment, then the one-year gap will not affect their service calculation as it will proceed from their joined date. If five more years are served in the new company, then the employee will have ten years of service and, thus, eligible for the Regular Pension Scheme.
If You Haven’t Completed 10 Years Of Service
Should you not have attained a decade’s worth of service and should you not desire to work further, you may take the amount from your Pension Account before retiring. In this case, you will not, however, accrue any interest on that amount. This amount will rather be formulated based on your total years of service and your last drawn salary to compute your pension benefits. The formula for calculating the EPF pension is: Monthly pension amount = (Pensionable Salary x Pensionable Service) / 70.
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