Government Clarifies EPFO Withdrawal Rules, Dismisses Misleading Claims
The Ministry of Labour and Employment has refuted misleading social media claims regarding the recent reforms under the Employees’ Provident Fund Organisation (EPFO). In a statement released by the Press Information Bureau (PIB), the ministry clarified that the viral posts were “factually incorrect and grossly misleading,” as they distorted key details about EPF withdrawal rules, eligibility criteria, and access to provident fund balances. The government explained that 13 complex provisions had been merged into three simplified categories to make the process more transparent. Moreover, the minimum employment period for withdrawals has been reduced from seven years to just one year. Members can now withdraw up to 75% of their eligible amount anytime, without additional documentation.
EPFO Busts Myths, Clarifies Partial Withdrawal Process
The EPFO’s official handle on X (formerly Twitter) shared a post titled “EPF Myth Busted!” to clarify the withdrawal provisions. The post stated that members can withdraw up to 75% of their EPF balance under the simplified rules, while the remaining 25% will stay safe for final settlement. An infographic in the post countered a common misconception — “You cannot withdraw your EPF even if unemployed” — by explaining that unemployed members are indeed allowed to withdraw a portion of their savings. The PIB further clarified that the 75% withdrawal includes both employer and employee contributions, along with accrued interest. The remaining 25% can be accessed after a year. Complete withdrawal is permitted under certain conditions such as retirement at 55, permanent disability, voluntary retirement, retrenchment, or relocation abroad.
No Change in Pension Entitlements or Job Outlook
The Labour Ministry also reassured that the recent EPFO reforms do not affect pension entitlements. It clarified that pension eligibility remains intact for members completing at least 10 years of service under the Employees’ Pension Scheme (EPS). Members who have not completed this period can still withdraw their pension contributions before retirement. The government further dismissed speculation that the reforms were introduced due to rising unemployment, calling such claims unfounded. Citing official data, the ministry highlighted that over 1.29 crore new workers were added to the payroll in 2024–25, while the national unemployment rate dropped to 3.2% in 2023–24, a sharp fall from 6% recorded in 2017–18.