EPS pensionable salary and pension query

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Student

62 Points Joined September 2009

Dear Expert

Please clarify on EPS :-

I see Pension contribution in the PF passbook. .. Does this mean that there will be a pension?

Is this the formula for calculation ?

Monthly pension amount= (Pensionable salary X pensionable service) /70."

1. What is pensionable salary in the private industry?. Is this just the monthly basic salary ?

2. Is there a CAP on the pensionable salary that is used in the formula? What is it ?

3. What is the pensionable salary in the following scenario :-

Job-1 ( 1990 to 1992 ) : Monthly basic at the time of leaving : Rs.10000

Job-2 ( 1992 to 2014) : Monthly basic at the time of leaving : Rs.20000

Job-3 ( 2015 to 2020) : Monthly basic at the time of leaving : Rs.21000 ( aged : 58)

Job-4 ( 2021 to 2023) : Monthly basic at the time of leaving : Rs.12000

Does the last basic salary, which is lower than the salaries from previous jobs, negatively impact the monthly pension amount ?

Thank you

Replies (1)

Manager - Finance & Accounts

58504 Points Joined June 2010

Pensionable salary = average basic + DA in last 5 years per job, capped at Rs. 15,000.
Total pension = sum over all jobs: (pensionable salary × service years) / 70.
Lower salary at last job won’t negatively affect pension if earlier service and salaries were higher.