On 16 September 2026, the Union Cabinet, chaired by Prime Minister Narendra Modi, approved the Ministry of Labour and Employment’s proposal to increase the wage ceiling for mandatory coverage under the Employees’ Provident Fund Organisation (EPFO) from ₹15,000 to ₹25,000 per month.
The proposal was recommended by the Expenditure Finance Committee during its meeting held on 16 June 2026 following inter-ministerial consultations.
The decision is expected to bring more than 51 lakh additional employees within the ambit of mandatory EPFO coverage, expanding access to provident fund savings, pension benefits and insurance protection under India’s statutory social security framework.
Key Highlights
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The Union Cabinet has approved an increase in the EPFO wage ceiling from ₹15,000 to ₹25,000 per month.
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The existing wage ceiling of ₹15,000 was introduced in September 2014.
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Earlier, employees drawing wages above ₹15,000 per month were not automatically brought under the EPF framework and remained outside mandatory provident fund, pension and insurance coverage.
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The revised ceiling will bring a significant number of employees earning between ₹15,000 and ₹25,000 per month within the statutory social security system.
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Eligible employees will gain access to:
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Provident Fund (EPF) benefits;
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Pension protection under the Employees’ Pension Scheme (EPS); and
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Insurance coverage under the Employees’ Deposit Linked Insurance Scheme (EDLI).
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The enhancement aligns the EPFO framework with rising wages, higher incomes and the continued expansion of formal employment across the country.
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The Government stated that, in several States and occupations, minimum wages have moved closer to the existing ₹15,000 threshold, necessitating an update to the coverage limit.
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The decision is expected to strengthen retirement security, improve workforce stability and employee retention, and expand social security coverage across the formal employment sector.
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The annual Government outgo is estimated at ₹11,339 crore, with total expenditure over the next five years projected at approximately ₹56,696 crore.
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EPFO currently has around 7.98 crore contributing members across about 7.68 lakh contributing establishments.
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EPS presently provides pension benefits to around 82 lakh pensioners.
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Following the Cabinet’s approval, the Ministry of Labour and Employment and EPFO will undertake the necessary statutory and administrative steps to implement the revised wage ceiling.
Also Read: EPF Coverage under the ₹15,000 Wage Ceiling: Membership and Contribution Rules Explained
Also Read: Labour Ministry Notifies Contribution Rates Under EPF, EPS and EDLI Schemes, 2026