EPFO Set For Major Overhaul, PF & Pension Salary Limit May Increase After 11 Years
The Employees Provident Fund Organisation (EPFO) is preparing for a significant change that could benefit over 10 million workers across India. Reports indicate that the Central Board of Trustees is expected to meet in December 2025 or January 2026 to discuss raising the salary cap for EPF and EPS eligibility .
Currently, employees earning up to Rs 15,000 per month must contribute to the Employees Provident Fund (EPF) and Employees Pension Scheme (EPS). Those earning above this limit can opt out, reducing the number of workers receiving retirement benefits. The proposed revision would increase the eligibility ceiling to Rs 25,000 per month—the first change since 2014.
Once implemented, this reform would expand coverage to a larger portion of India’s workforce, providing more employees with retirement and pension security. Both employees and employers contribute 12 percent of the employee’s salary to the Provident Fund. The employer’s share is divided, with 3.67 percent going to EPF and 8.33 percent allocated to EPS. Raising the cap will bring more people back under the PF system, strengthening social security nets and increasing fund contributions.
EPFO currently manages a massive fund of Rs 26 lakh crore, serving 7.6 crore active members nationwide. Experts view this move as a positive step towards financial inclusion, offering greater stability to workers amid a changing economic landscape.
Labour Ministry officials emphasise that the update is long overdue. Rising salaries and persistent inflation have rendered the existing Rs 15,000 cap inadequate. The new limit aims to ensure more formal-sector workers have post-retirement protection and can benefit from pension schemes.
If approved, this will be the largest revision to EPFO rules in over a decade. The move reflects a broader effort to align the Provident Fund system with India’s evolving workforce and wage structures, making social security more accessible and inclusive.
Currently, employees earning up to Rs 15,000 per month must contribute to the Employees Provident Fund (EPF) and Employees Pension Scheme (EPS). Those earning above this limit can opt out, reducing the number of workers receiving retirement benefits. The proposed revision would increase the eligibility ceiling to Rs 25,000 per month—the first change since 2014.
Once implemented, this reform would expand coverage to a larger portion of India’s workforce, providing more employees with retirement and pension security. Both employees and employers contribute 12 percent of the employee’s salary to the Provident Fund. The employer’s share is divided, with 3.67 percent going to EPF and 8.33 percent allocated to EPS. Raising the cap will bring more people back under the PF system, strengthening social security nets and increasing fund contributions.
EPFO currently manages a massive fund of Rs 26 lakh crore, serving 7.6 crore active members nationwide. Experts view this move as a positive step towards financial inclusion, offering greater stability to workers amid a changing economic landscape.
Labour Ministry officials emphasise that the update is long overdue. Rising salaries and persistent inflation have rendered the existing Rs 15,000 cap inadequate. The new limit aims to ensure more formal-sector workers have post-retirement protection and can benefit from pension schemes.
If approved, this will be the largest revision to EPFO rules in over a decade. The move reflects a broader effort to align the Provident Fund system with India’s evolving workforce and wage structures, making social security more accessible and inclusive.
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