New Delhi, May 27: Central government has notified that any public sector undertaking (PSU) employee dismissed or removed from service will forfeit retirement benefits, including those earned during prior government service.
This update comes via amendments made to the Central Civil Services (Pension) Rules, 2021, notified on May 22, 2025, by the Ministry of Personnel.
According to the Central Civil Services (Pension) Amendment Rules, 2025, dismissal or removal from a PSU due to subsequent misconduct will now lead to forfeiture of all retirement benefits, even for service rendered prior to PSU absorption.
The rule also provides a safeguard — such decisions will be subject to review by the administrative ministry concerned with the respective PSU.
Previously, such forfeiture was not allowed, meaning employees retained pension rights for government service even after being dismissed from a PSU.
Additionally, the amended rules extend provisions of “pension and family pension subject to future good conduct” and “compassionate allowance” to such employees, similar to norms applicable to dismissed central government servants.
The CCS (Pension) Rules, 2021 are applicable to government employees appointed on or before December 31, 2003, excluding railway personnel, casual workers, and officers from IAS, IPS, and IFoS.
