New NPS Rule: Eligibility situation to get lump sum compensation modified for these workers

The government has come out with new NPS rules regarding the payment of lump sum compensation to employees covered under National Pension System on retention in government service inspite of disablement attributable to government service. This is in accordance with Rule 9(3) of CCS (Extra Ordinary Pension) Rules, 1939.

On the introduction of National Pension System with effect from 01.01.2004, among others, the CCS (Pension) Rules, 1972 and CCS (EOP) Rules, 1939 were amended to the effect that the provisions of the Rules would not be applicable to the government employees appointed on or after 01.01.2004.

However, considering the hardships being faced by the employees covered under National Pension System and their families, orders were issued for provisionally extending the benefits of invalid pension, disability pension and family pension under CCS (Pension) Rules and CCS (EOP) Rules on the discharge of such employees from service on invalidation/disability or on their death during service.

Representations and references were received for extending the benefit under Rule 9(3) of CCS (EOP) Rules, to the employees appointed on or after 01.01.2004 and covered under NPS.

In accordance with Rule 9(3) of CCS ( EOP) Rules, applicable to Government employees appointed before 01.01.2004, if a Government employee is retained in service in spite of a disablement attributable to Government service, a lump sum compensation is paid to him by arriving at the capitalized value of the disability element of disability pension, with reference to the commutation table in force from time to time.

The broad-banding under Rule 8(3) of those rules is, however , not applicable in such cases. In accordance with the OM dated 05.05.2009, the benefit of disability pension is available to the employees covered under the National Pension System only on being boarded out on account of the disability attributable to Government service, however, the benefit under Rule 9(3) of the CCS ( EOP) Rules, is presently not available to an employee covered under NPS, if he is retained in service in spite of a disablement attributable to Government service.

NPS New Rule

It has now been decided that if a Government employee appointed on or after 01.01.2004 and covered under NPS is disabled, he shall also be eligible to receive a lump sum compensation computed in terms of rule 9(3) of CCS (EOP) Rules, if the disablement is attributable to Government service and the Government employee is retained in service in spite of such disablement.

The provisions will take effect from 01.01.2004. The cases for payment of lump sum compensation to the employees covered under NPS and who have been retained in service in spite of disability attributable to Government service on or after 01.01.2004 may be processed accordingly.