The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the enhancement of the wage ceiling for mandatory coverage under the Employees’ Provident Fund Organisation (EPFO) from Rs 15,000 to Rs 25,000 per month.
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.
At present, employees joining a job with a monthly wage above Rs 15,000 are not automatically covered under the Employees’ Provident Fund (EPF) framework. The revised ceiling will bring workers earning between Rs 15,000 and Rs 25,000 per month under the statutory social security system.
The move will extend benefits under the Employees’ Provident Fund Scheme, Employees’ Pension Scheme (EPS) and Employees’ Deposit Linked Insurance Scheme (EDLI), in accordance with applicable provisions.
The wage ceiling was last revised in September 2014, when it was raised from Rs 6,500 to Rs 15,000 per month. The government said the latest revision reflects sustained wage growth, rising incomes and the expansion of formal employment over the past decade.
The measure is also expected to support employment formalisation, worker retention and long-term retirement security. It will help ensure that a larger section of the formal workforce receives portable and assured social security protection, the government said.
The proposal was recommended by the Expenditure Finance Committee on June 16, 2026, following inter-ministerial consultations. The annual government outgo is estimated at around Rs 11,339 crore, with the expenditure over five years projected at approximately Rs 56,696 crore.
EPFO administers the EPF, EPS and EDLI schemes. It currently has around 7.98 crore contributing members across about 7.68 lakh contributing establishments. The EPS provides pension benefits to around 82 lakh pensioners.
The Ministry of Labour and Employment and EPFO will take the necessary statutory and administrative steps to implement the decision.
