Aatmanirbhar Bharat Rozgar Yojana

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Aatmanirbhar Bharat Rozgar Yojana

On 12th November 2020, Aatmanirbhar Bharat Rozgar Yojana was announced as a part and parcel of Aatmanirbhar Bharat 3.0 package. The basic objective of the Scheme is to create new and additional employment opportunities at the time of the COVID recovery stage. The newly introduced Scheme is briefly explained in the current article.

The validity of the Scheme

The scheme is started on 1st October 2020. The registration of the eligible employers, as well as a new employee, is possible up to 30th June 2021.

Calculation of the reference base of the employees

The reference base number for determining the eligibility of the establishment is to be calculated as under-

  1. Cases, wherein, electronic-challan cum return for the wage month of September 2020 is filed within due date-

Reference base number = the number of employees for whom the employer has remitted the contributions.

  1. Cases, wherein, the electronic-challan cum return for the wage month of September 2020 is filed after the due date but before 15th December 2020-

Reference base number = higher of (a) or (b)

(a) = the number of the employees shown in the electronic-challan cum return for the wage of September 2020.

(b) = the number of the employees as per the last electronic-challan cum return filed up to 11th November 2020.

  1. Cases, wherein, the establishment is newly registered with EPFO between 1st October 2020 to 30th June 2021-

Reference base number = zero.

Eligibility criteria for the establishments and new employees

Establishments criteria-

  • Establishments already registered needs to satisfy the following criteria-
    1. The establishment should employ the following minimum employees, over and above the reference base-
Minimum number of new employees to be employed above the reference base Corresponding reference base of the employee
Two Less than or equal to 50
Five More than 50
  • In order to avail the benefit for any wage month, the establishment needs to maintain both-
    1. Minimum number of new employees; and
    2. Retain the number of employees which is taken as a reference base.
  • Establishments getting registered between 1st October 2020 to 30th June 2021 needs to satisfy the following criteria-
    1. The reference base of the newly registered establishment will be treated as zero.
    2. The establishment will not be allowed to exit the scheme under the EPF and MP Act, 1952.
    3. The beneficiary employee can withdraw the amount only after the expiry of two years from the completion of the validity period of the Scheme.

New Employees criteria

  1. The eligible establishment should register the new employee under the scheme during the period 1st October 2020 to 30th June 2021.
  2. The new employee should have Aadhaar based UAN (Universal Account Number).
  3. The monthly wage of the new employee should be less than INR 15,000 during the period of the Scheme.
  4. The new employee will be ineligible under the Scheme, if-
    1. The employee is already a registered beneficiary; and
    2. The employer eligible or availing benefit of PMRPY/ PMPRPY, 2016.

Amount of benefit available under the Scheme

Subsidy at following tabulated scale is available for 24 months in respect of eligible new employees-

Particulars Quantum of subsidy
Establishment employing up to 1000 employees in wage month September 2020 Both employer’s as well as employee’s contribution (as per statutory rate) subject to a maximum of 24% of the wages.
Establishment employing more than 1000 employees in wage month September 2020 Only employee’s contribution, as per the applicable statutory rate.  The same is subject to a maximum of 12% of the wages.

The basic requirement to be fulfilled for availing benefit under the Scheme

  1. Firstly, the employer needs to ensure the updating of ownership return being filed with the EPFO. Secondly, the employer should obtain a declaration in Form 11 from all the joining employees.
  2. The establishment should obtain registration under the Scheme. While registering, the establishment should disclose the reference base of the employees.
  3. The new employees should be registered under the Scheme during the period 1st October 2020 to 30th June 2021.
  4. The establishment should file one ECR (i.e. Electronic Challan cum Return) in respect of all the employees for each wage month.

Important point-

  • Once the benefit under the Scheme is eligible, the employer will not make any deduction towards the employee’s share of EPF from the wages of the employee.
  • The establishment is barred from claiming the benefit received under the Scheme as an expenditure.
  • Employer, as well as the establishment, will be responsible for the correctness/ accuracy of all the details/ particulars submitted while claiming the benefits under the Scheme.

Post by poonamgandhi

CA Poonam Gandhi is a Chartered Accountant and a Lawyer. With a wide practice experience and deep understanding of different laws and taxes, she has been an independent professional writer in the field of taxation, finance and laws.