Up to now, the EDLI Scheme has been managed by the EPFO with benefits as payable on and before July 18, 2025. In order to enhance the insolvency of the family of the deceased EPF member, there were severe amendments in the EDLI Scheme. The notification by the Ministry of Labour and Employment with the changes lays down the introduction of a ₹50,000 minimum assurance benefit and relaxed eligibility criteria, which shall benefit millions over low-income and contract workers. This article explains the amendments, eligibility, benefits, and claim process.
Introduction of Minimum Assurance Benefit
The 2025 amendments provide for a minimum payout of ₹50,000 to be given to the nominees if and when the average PF balance of the deceased employee during the last twelve months or his/her entire membership is lower than ₹50,000. Before this amendment, if the PF balance were very low, the payout would also be less, which rendered the families without much help. The Central Board of Trustees (CBT) accepted the amendment on February 28, 2025. Thus, this would ensure the financial safety net at least to those workers who have had a short service period or have contributed very low during the service.
Relaxed Service Continuity Rules
A fundamental reform of the existing setup eliminates the stringent requirement of rendering continuous service for 12 months. Now, any breaks in employment for a period of up to 60 days are not taken into account so that different stints of job are treated as continuous service periods. This, in turn, helps the working population with their frequent changes in employment as in the case of act contractors or even employees working in the informal sector to keep their eligibility for EDLI benefits intact. For instance, an employee who took a break of 50 days between jobs in a 12-month period is now eligible for the scheme, making it more inclusive.
Extended Coverage Post-Contribution
The amendments extend the benefit cover to those employees who die within six months of their last contribution to the PF and so long as they remain on the rolls of the employer. Under the previous arrangement, only those contributing to the PF at the time of their death were covered—the very persons who at one stage were considered to be contributing and who upon death needed extended leave or had died in the process of transitioning between jobs were left out of the scheme. This change being effective immediately will take care of occasions of long illness, among other things, where families become vulnerable and in need of extra support.
Remuneration Structure and Computation
The EDLI payment is thirty times the average monthly salary (basic + DA, limited to ₹15,000) plus a gratuity of ₹2.5 lakh, subject to a maximum of ₹7 lakh. If the salary of the employee is ₹10,000 per month, the amount receivable shall be ₹5.5 lakh (30 × ₹10,000 + ₹2.5 lakh). The new minimum of ₹50,000 ensures that families of low-paid employees will receive help. The employer contributes 0.5% of the salary (subject to a maximum of ₹75 per month), but no contribution is made by the employee.
Claim and Employer Obligations
The nominee shall file the claim on Form 5 IF along with a death certificate and PF details with the employer who would forward the claim to the EPFO for verification. Claims ought to be filed well in time to avoid delays with your target settlement time being 30 days. Employers need to maintain proper records to stay compliant, as the EPFO can recover unpaid contributions with interest to fund payouts. HR should make an effort to make employees aware of EDLI during the onboarding process.
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