The new EPF notification to have cascading effect on the knitwear cluster

Tirupur garment sector stakeholders urge the Union Government to re-examine the new notification in the Employees Provident Fund Scheme, 1952, that incorporated an amendment which fixed the age limit of 58 years for withdrawing employer’s contribution from the provident fund account.

Sakthivel, president of Tirupur Exporters’ Association, said that the notification would have a cascading effect on the knitwear cluster when it comes to getting migrant workers due to which the stakeholders of garment sector are upset.

In the new notification, the workers should be allowed to get both his and employer’s contribution from the provident fund account when resigns from a particular company, he added.

Entrepreneurs who have brought young women workers for employment in Tirupur knitwear cluster with the assurance that they would be able to get a certain amount from the provident fund before they quit either for marriage or for delivery, have expressed shock over the sudden issuance of the notification.

Another major setback for Tirupur knitwear industry is that many of the present-day owners of the textile units have been workers one day and they used the provident fund as the initial capital for starting their units.

According to R. Nambirajan, director of Network Clothing Company, with the new notification, they would not be able to use the opportunity of using the provident fund as the initial capital to start up units.