Can you settle pending PF damages at lower rates? EPFO's Vishwas 2026 Scheme can help

Many employers have been fighting long-pending provident fund (PF) damage cases for years. Some are caught up in court battles, while others are waiting for proceedings to move forward. If that sounds familiar, the Employees' Provident Fund Organisation (EPFO) now has a one-time settlement window that could help bring these disputes to an end at a much lower cost.The EPFO has launched the Vishwas 2026 Scheme, a special six-month settlement scheme that allows eligible employers to resolve pending PF damages cases by paying significantly reduced penal damages. The scheme applies to defaults that occurred before June 14, 2024 and aims to provide a quicker, simpler and more transparent route to closure.WHAT IS THE VISHWAS 2026 SCHEME?In a post on X, the EPFO said employers can settle eligible cases pending before the Supreme Court, High Courts or the Central Government Industrial Tribunal (CGIT) at reduced damage rates of 0.25%, 0.50% or 1%, depending on the period of delay.The organisation said the scheme provides a settlement mechanism for pending proceedings relating to damages under Section 14B of the EPF Act. Once the prescribed amount is paid, employers can obtain closure of their pending disputes. To explain the initiative, the EPFO also released a video describing the scheme as a one-time opportunity available for only six months.WHO CAN BENEFIT FROM THE SCHEME?According to the EPFO, the scheme covers a wide range of pending cases. These include matters already under litigation before courts or the CGIT, cases where damages have been assessed but remain unpaid, cases where a Section 14B notice has already been issued, as well as pre-adjudication matters where notices are yet to be served.The objective is to help employers resolve disputes that have remained pending for years without going through prolonged legal proceedings.LOWER DAMAGES MEAN SIGNIFICANT SAVINGSOne of the biggest attractions of the Vishwas 2026 Scheme is the reduced rate of penal damages.Under the scheme, defaults of less than two months will attract damages at 0.25% per month. Delays of two months to less than four months will be charged at 0.50% per month, while defaults of four months or more will attract damages at 1% per month.The EPFO says these rates are substantially lower than the standard damages levied under Section 14B, offering employers considerable financial relief.THE ENTIRE PROCESS IS ONLINEThe organisation has also made the settlement process fully digital.Employers need to log in to the EPFO Employer Portal and select the Vishwas Scheme option. After submitting the online application and uploading the required documents, the EPFO will recalculate the damages using the revised rates.The revised amount will be communicated through SMS or email. Once the employer accepts the recalculated amount online, payment must be made within 15 days through the ECR-linked payment mechanism using the special Vishwas ID.After successful payment, the EPFO will issue a digitally signed Vishwas certificate. This certificate can then be submitted before the relevant court or tribunal to help conclude the pending proceedings.A LIMITED-TIME OPPORTUNITYThe EPFO has described the Vishwas 2026 Scheme as a one-time, six-month window available from June 29, 2026 to December 29, 2026, designed to reduce litigation and improve compliance.For employers with long-pending PF damages cases, unpaid Section 14B dues or ongoing litigation, the scheme offers an opportunity to settle disputes at substantially reduced rates instead of continuing lengthy legal proceedings.With lower penalties, an online process and a clear mechanism for closing pending cases, the EPFO hopes the scheme will encourage more establishments to resolve old disputes and move towards full compliance.- EndsPublished By: Jasmine anandPublished On: Jul 22, 2026 14:41 IST