EPF transfer, passbook access to get easier for employees, but more reforms needed, say experts

Employees will now be able to access their Employees’ Provident Fund (EPF) passbook and monitor the transfer their provident fund account from one employer to another with fewer hassles.

When employees switch jobs, their PF accounts are transferred to their new employers’ PF office through Form 13. Subsequently, the transfer certificate – termed Annexure K -- is generated by the previous PF office and sent to the new PF office. Until now, this document was only shared amongst PF offices, though employees could make a visit to obtain a copy after sending an official request.

Annexure K, or EPF transfer certificate, now available online

Now, the EPFO has enabled a facility to allow employees to directly download Annexure K in PDF format from the member portal. This will allow them to monitor the status of their transfers online and ensure that PF balance and service period are correctly updated in the new account, which is critical for employees’ pension scheme (EPS) calculations at the time of retirement.

“This is a major boost for employees as they can now download the Annexure K to verify whether their PF balance and service history was accurately transferred out. This should also save time for the members as they no longer have to reach out to EPFO office for Annexure K,” says Ketan Das, Manager, Strategy and Operations, FinRight.in, a fintech firm that helps individuals get their provident fund grievances resolved.

This measure could be a step towards easing one of the most persistent grievances of employees. "That is, difficulty in securing continuity of service and accumulated benefits when changing jobs. By reducing the dependency on employers and regional offices for these records, employees gain greater control over their own entitlements,” says Vivek Tiwari, Associate Partner, Taraksh Lawyers & Consultants.

The procedure has been tedious so far. “Previously, while PF offices exchanged Annexure K internally to facilitate transfers, employees could access it only upon request,” says Kuldip Kumar, Partner, Mainstay Tax Advisors.

However, it remains to be seen how smooth the implementation on the ground is. "In cases where an employee is moving from an exempted establishment (which maintains PF benefits through a private trust) to an unexempted establishment (which maintains PF with the EPFO), the employee may still need to manually request Annexure K and complete certain offline steps to transfer their PF account,” points out Kumar.

However, EPFO and the labour ministry need to make more efforts to ease the dispute resolution process. “The single biggest reform would be the development of a quicker dispute mechanism both at the member level and at the employer level, and transparency in how and basis what documents, the field offices arrive at a conclusion/view. Uniformity of practices in this regard (of which the Annexure K is a good first step) and communication of this would greatly benefit all stakeholders,” says Sowmya Kumar, Partner, Cyril Amarchand Mangaldas.

Single portal access for EPF passbook

The Employees’ Provident Fund Organisation (EPFO) has introduced a ‘Passbook Lite’ feature on its member portal. At present, employees had to log in separately to the dedicated passbook portal to check PF contributions, withdrawals and transactions.

“This dual login system often causes delays, password synchronization issues, and member grievances,” the EPFO said. Through Passbook Lite on the member portal, employees will be able to view their summarised passbook displaying details of their contributions, withdrawals, and current balance. “The fact that it takes six hours for the user to be able to login to the passbook portal after resetting the password on the member portal was a hurdle. This update will hopefully solve that issue. It should also ease the claim filing process as members can now verify their balance before applying claims and avoid surprises later on,” says Das.

Also read: Switching jobs? Know the hurdles in transferring your EPF

Easier, quicker approvals on the cards

Often, several EPFO services and processing requests including transfers, settlements, advance (loans) and refunds necessitate approvals from higher level EPF officers such as Regional Provident Fund Commissioners (RPFC) or Officer-in-charge. “This multi-layered approval process often led to delays and longer processing times for members’ claims,” the EPFO stated in an official media release.

Also read: How technical glitches can erase 15 years of your EPF service overnight

Therefore, it has now decided to ease the approval hierarchy. From RPFC/Officers-in-Charge, the powers have been delegated to assistant PF commissioners and subordinate levels. They can now take calls on PF transfers and settlements, advances, refunds, cheque/ECS/NEFT returns and interest adjustments, among other things.

"This will shorten turnaround times for claims, withdrawals, and advances. This reform is particularly significant as it reduces bureaucratic bottlenecks, ensuring that employees can access their own savings in a timely and efficient manner," adds Tiwari.

According to EPFO, rationalisation in approval layers will lead to faster claim settlements and reduced processing time. “Usually the high value claims (above Rs 25 lakh) go through multiple layers of approval within EPFO. We’ll now have to wait and watch the impact of this new change on the ground,” says Das.

Beyond these recent reforms, however, experts believe the EPFO architecture is in urgent need of an overhaul. For example, EPFO's official social media handles are inundated with unresolved grievances aired by employees every day. "Pension-related grievances constitute a major area of concern. At present, the onus of declaring whether or not they are eligible for EPS is on the employees by filling Form-11 (employees can share their previous EPF/EPS, KYC and other details). Besides, the process of rectifying any error in EPS is manual and cumbersome. These issues need to be sorted out, which could pave the way for bringing down the claim rejection rate," says Das.

While several steps have been taken, including the recent ones, to ease compliance and grievance redressal process for employees, the gap remains huge. “The annual grievances of over two million received by EPFO indicate systemic problems that need to be addressed. The KYC verification process needs complete overhaul with real-time Aadhaar-PAN-bank account synchronisation to prevent the frequent claim rejections due to minor data mismatches,” says Ashutosh Srivastava, Partner, SKV Law Offices. He recommends legally mandated grievance resolution timelines with compensation mechanisms for delays exceeding 30 days. "The proposed 7-day response mandate is insufficient without enforceable penalties and automatic escalation mechanisms,” he adds.