What is a Certificate of Coverage (CoC)?
Employees who are deployed on work assignments to foreign countries where India has signed a social security agreement are exempt from contributing to the social security scheme in the host country provided they are still contributing to the EPFO in India. This scheme avoids dual contribution and saves money for the employee / employer. There are 18 countries with which India has this arrangement at present.
Countries: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Hungary, Japan, Luxembourg, Netherlands, Norway, Portugal, South Korea, Sweden and Switzerland.
Case Study - 1
Problem: An employee of a client (IT Company) initiated the Certificate of Coverage (CoC) at the EPFO office in Bangalore for a long term assignment in Germany. After due process, he was issued the CoC and the same was submitted to the host country to obtain the social security contribution exemption. However, the authorities of the host country rejected the CoC citing the lack of information about the specific article number under which exemption was claimed in the certificate submitted. The employee was forced to approach the EPFO in India for a resolution. When the employee highlighted this issue with EPFO authorities, the local officials informed that the CoC was a standard certificate generated through the system and hence cannot be amended. Since the duration was captured in the issued Certificate along with the passport and UAN details, the employee could not reapply for a fresh CoC for the same period. It was a Catch 22 situation for the employee and he was desperate for a resolution to avoid dual contribution that would impact him monetarily.
Solution: The TTK GMS team reviewed the case completely and charted out a clear plan to resolve the issue. Our CoC specialist met the PF Commissioner at the respective EPFO office on behalf of the employee. He presented the case details, including the technical issue in the EPFO system which doesn't provide an option to select the article number on the SSA agreement. He also highlighted that a system limitation may lead to injustice for an Indian citizen overseas and prevent the applicant from availing a benefit that was due to him. The EPFO Commissioner understood the problem and escalated it to his Head office for a resolution including putting in a request for addressing a change at the system level. In parallel, he sought an approval from the Head office to include the Article Number in the Approved CoC. To avoid further challenges, we requested the PF Office to add a counter signature and affix the seal of EPFO office to authenticate that these corrections were made manually. The Commissioner also obliged our legitimate request and issued the manually amended COC with his seal and signature. Finally the rectified CoC was accepted at the host country and the employee was able to complete his social security related formalities and avail the exemption benefits.
While there may be inherent limitations, it is important to understand the problem thoroughly and be able to present it to the authorities in the right manner, thus enabling a quick resolution to the issue. TTK GMS has time and again, solved complex issues for its clients on the strength of its liaising capabilities and through legitimate and lawful representation of the problems presented to it.