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Tuesday, March 22, 2016

TEA urges rollback of EPFO amendment

Tirupur Exporters’ Association (TEA) today urged the Union Labour Ministry to rollback the amendment stating that employers’ contribution withdrawal could only be done when the employee was 58 years, in the Employees’ Provident Fund Organisation (EPFO).

In a letter to Minister Bandaru Dattatreya, TEA president A. Shaktivel said that the amendment has created ripples in Tirupur knitwear garment cluster, which employed four lakh workers directly, with 70 per cent of women being part of EPFO with an option for withdrawal on cessation of employment.

Further  to  this  amendment,  the  employees  can  withdraw  the  PF  account  from  their  own  total contribution including interest thereon up to date, but the employers’ contribution could be withdrawn only after they complete 58 years, he said.

Normally girls aged 18 joined garment units and left at the age of 23 / 24 before getting married. The new amendment has created an alarming situation in Tirupur as these women were now apprehensive about having to wait till they turned 58 to receive the employers PF contribution, Shaktivel said.

Apart from this, Tirupur cluster was also receiving migrant workers from North India, numbering about
75,000. The inflow from the northern states was still increasing day by day, which was actually helping to meet the labour shortage.

So, there was this apprehension that the amendment would restrict the inflow of workers to Tirupur cluster.


We actually  fear that the notification  may trigger  the exodus  of labour  and in such scenario,  the garment exporting units would not be in a position to immediately fill up the labour shortage gaps. This will lead to a chain reaction and ultimately the export business will drastically reduce from the present

Considering the gravity of the foreseen repercussions, 
TEA has urged the Minister to provide relief and remove  the  condition  put  forth  in  the  amendment  immediately.  This  would  allow  workers  to  get employers contribution when resigned, Shaktivel added