New Delhi: The government has approved raising the wage ceiling for mandatory Employees’ Provident Fund Organisation (EPFO) coverage to Rs 25,000 per month from Rs 15,000, bringing more workers under formal social security.
The Union Cabinet decision, announced on Wednesday, is expected to benefit more than 51 lakh additional employees. The revised ceiling will take effect from September 17, 2026, coinciding with Vishwakarma Day.
First Revision In 12 Years
The EPF wage ceiling is being revised after 12 years. It was last increased to Rs 15,000 in September 2014.
Information and Broadcasting Minister Ashwini Vaishnaw said Rs 25,000 per month will now be the wage ceiling for provident fund deduction.
The Labour Ministry said the revision reflects sustained wage growth, rising incomes and the expansion of formal employment since the previous increase.
Wider PF, Pension Coverage
Currently, a new employee joining at a monthly wage above Rs 15,000 is not automatically covered under the mandatory EPF framework.
Increasing the ceiling means a large number of workers earning between Rs 15,000 and Rs 25,000 will now enter the statutory social security system.
They will gain access to provident fund savings, pension protection under the Employees’ Pension Scheme (EPS) and insurance protection through the Employees’ Deposit Linked Insurance Scheme (EDLI), subject to applicable provisions.
Government Outgo To Rise
The annual government expenditure following the revision is estimated at about Rs 11,339 crore, compared with existing annual budgetary support of around Rs 10,250 crore.
The estimated expenditure over five years is approximately Rs 56,696 crore.
Also read: EPFO Delays PF Payout, Retired Employee To Get 6% Interest On ₹14 Lakh
Labour and Employment Minister Mansukh Mandaviya said the move would provide wider social security protection to workers while accelerating employment formalisation.
EPFO currently has about 7.98 crore contributing members across nearly 7.68 lakh establishments. The EPS also provides pension benefits to around 82 lakh pensioners, while EDLI offers insurance protection linked to EPF membership.
