Withdrawal of Provident Fund by overseas workers

Norms for withdrawal of provident fund by overseas workers employed in the country (Not having valid Social Security Agreement) until they are 58 years old or are incapacitated (permanent and total in capacity for work due to bodily or mental infirmity), has now been amended.
India has signed nearly 12 social security agreement but only two with Belgium and Germany are currently operational.

Indian workers are allowed to withdraw their PF balances under a number of circumstances, International workers will be only able to do so on retirement at 58 years against 55 years for local workers, according to the latest changes made through an amendment to the Employees’ Provident Funds Scheme, 1952.

However, in the case of permanent and total incapacity to work due to bodily or metal infirmity withdrawal will be allowed.

Overseas workers will need to keep their bank account in India till the refunds are received in such account.

Certain Related Terms under PF Act

An International worker
An International worker may be an Indian worker or a foreign national.
This means an Indian worker who has divided his/her career between India and another country with whom India has entered into a bilateral Social Security agreement or a foreign national working in India. (Para 2 ff)

An Excluded Employe’ under the provisions
A ‘detached worker’ posted in an establishment in India but contributing to the social security programme of the source country in terms of the bilateral Social Security agreement signed between that country and India shall be an ‘excluded employee’ under these provisions. (Para 2 f)

A Detached Worker
An International worker, being not an Indian employee, contributing to the social security programme of the source country in terms of the bilateral Social Security agreement signed between that country and India and exempt from making any contribution to the Indian system for the period and terms as set out in such an agreement is a ‘detached worker’ for the purpose of compliance under the Indian system. (Para 2 f)

A social security agreement (SSA)
A social security agreement is a bi-lateral instrument to protect the interests of the workers in the host country. It being a reciprocal arrangement generally provides for avoidance of no coverage or double coverage and equality of treatment with the host country workers

Status of the SSAs
As of today, Social security agreements have been signed with Belgium, France and Germany. But the date of entry into force is yet to be notified. Negotiations are at various stages with The Netherlands, Czech Republic, Hungary, Norway, Switzerland, Sweden, Luxembourg, USA and Australia. Government level talks are on with many other countries where sizable numbers of Indian workers are employed. Although not a formal agreement, there is a reciprocal arrangement between India and Korea to settle the claims of the employees on completion of employment in the host country