This is in response to a news item "EFP rejects EOBI notices" carried by Business Recorder on 14th March 2017. The Director General (Operations/ spokesperson for EOBI strongly denies the contents of the news item. Factually, none of the Hon'able Courts has restrained EOBI from functioning under the provisions of EOB Act, 1976.
However, the EOBI's circular dated 28.3.2016 notifying enhanced rate of contribution, based on Minimum Wages of Unskilled Workers (Amendment) Act, 2016 has been impugned by employers in the High Courts due to its applicability to Islamabad Capital Territory only. Barring Lahore High Court, that has declared said circular ultra-vires, no High Court has made any such order or restrained EOBI from collecting EOBI Contribution. Sindh, Balochistan and Peshawar High Courts, have only restrained EOBI from initiating any coercive measures for recovery on the basis of demand raised against enhanced rate of contribution.
It will not be out of place to mention that pension payable to EOBI pensioners is based on rate of contribution paid by employers & employees. Contribution rate is further tied to minimum wages. The EOBI is collecting contribution as per minimum wages of 2016 ie Rs 13,000 pm despite the fact that Federal Government and all the provinces have enhanced minimum wages to Rs 14,000 pm. The pensioners of employers paying contribution at enhanced rate of Rs 780 are getting enhanced pension of up to Rs 10,680 pm as compared to minimum pension of Rs 5,250.
The litigations have mainly ensued due to non-devolution of EOBI to provinces, a matter that is sub judice before Supreme Court. Irrespective of the decision of the Supreme Court or the Federal Government regarding the fate of EOBI (to continue as provincial or federal body) the employers are bound to pay EOBI contributions. Non-payment of contribution or payment at reduced rate under the garb of sub judice matters may result in disruption of EOBI pension, accumulate employers' liabilities and resulting Statutory Increase of up to 50% on unpaid contribution. In view of above facts, EOBI urges the business community to come forward to pay EOBI Contribution to secure well-being of their employees through Old Age Pension and other related benefits.