Employees’ Provident Fund Organisation (EPFO) has issued a clarification stating that overlapping service periods should not be grounds for rejecting PF transfer claims.
The directive, released in a circular dated May 20, 2025, aims to streamline the transfer process and prevent unnecessary delays for employees switching jobs.
Previously, many regional EPFO offices rejected transfer claims due to overlapping employment records, causing financial distress for affected employees.
The latest clarification ensures that genuine overlaps will no longer be considered a disqualification for processing PF transfers.
Understanding Overlapping Service Periods
An overlapping service period occurs when an employee’s exit date from one company and joining date in another coincide, making it appear as though the individual was employed at two places simultaneously.
This can happen due to:
- Delays in updating records by previous employers.
- Early joining dates recorded by new employers.
- Clerical errors in service records.
Such discrepancies often led to automatic rejection of PF transfer claims, blocking employees from accessing their savings.
EPFO New Guidelines for Processing Claims
Under the new directive, EPFO has instructed that transfer claims involving overlapping service periods must be processed rather than rejected outright.
However, if a genuine need arises, the processing officer may seek clarification before approving the claim.
The circular states: “Only in cases where a genuine need is felt to clarify the overlapping of service, would the claims be processed after obtaining the requisite clarification.”
Additionally, EPFO has introduced digital reforms to simplify the PF transfer process, including:
- Digitization of withdrawal and settlement claims.
- Elimination of cheque leaves and bank-attested passbooks for filing claims.
- Online verification of employment records to reduce errors.
Impact on Employees and Industry Response
The clarification is expected to benefit millions of salaried employees, ensuring smoother PF transfers and preventing unnecessary financial hardships.
Experts in personal finance have welcomed the move, stating that it will reduce bureaucratic hurdles and increase transparency in EPFO operations.
Industry analysts suggest that the Union Labour Ministry is making broader efforts to modernize EPFO’s operations.
They believe these reforms aim to enhance employee benefits and improve financial security for salaried workers.
The organization has also been working on server upgrades to improve processing speeds, with full implementation expected by June 2025.
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