EPFO Scheme Better for Construction Workers: Regional Provident Fund Commissioner

New Delhi, May 2 (PTI) Retirement fund body EPFO's provident fund scheme under the EPF Act provides better protection to construction workers compared to the benefits available under the framework of building and other construction workers (BOCW), a regional provident fund commissioner has ruled, clarifying ambiguities between the two legislations.

The clarification order by regional provident fund commissioner (RPFC), Kochi Uttam Prakash, which would have significant implications for labour welfare across India, came after the Kerala High Court issued a directive to resolve a long-standing conflict between two major national legislations governing the social security of construction workforce.

While disposing of a writ petition filed by Veegaland Homes Pvt. Ltd., a real estate developer, the court directed the RPFC, Kochi, to determine which law provides more beneficial coverage for construction workers -- the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (EPF Act) or the Building and Other Construction Workers (BOCW) Act, 1996.

After evaluating the two welfare frameworks, the RPFC concluded that the EPF scheme provides superior protection for construction workers compared to the BOCW framework.

The order outlined key advantages including lifetime pension coverage under the Employees' Pension Scheme (EPS), substantial death and disability benefits via the Employees' Deposit-Linked Insurance Scheme (EDLI), portability of benefits across states and employers structured, long-term savings with higher returns and a technology driven access to services and grievance redressal.

In contrast, BOCW welfare boards, despite collecting substantial welfare cess, have challenges of inefficiency, low coverage, and underutilisation of funds and poor access to registration by design, the RPFC order said.

Workers frequently struggle to access even basic entitlements under this scheme, it noted.

The petitioner in the Kerala High Court had argued that employers were being subjected to an unfair dual compliance burden under both central and state welfare regimes.

While the EPF Act is administered nationally by the EPFO, the BOCW Act is enforced by state-level welfare boards, often with considerable variation in benefit delivery across states.

As India continues to rely on its informal workforce to build its infrastructure and cities, the Kerala High Court-led resolution could serve as a cornerstone for a more inclusive, effective, and future-ready labour protection framework, opined an expert.

By prioritising structured, portable, and enforceable benefits, the RPFC order reaffirms the constitutional promise of social justice and sets a powerful precedent for integrating the informal workforce into the mainstream of social security, the expert added.