EPS 2026 pension scheme: Key changes EPF members should know
The Ministry of Labour and Employment has notified the Employees' Pension Scheme (EPS), 2026, which replaces earlier Employees' Pension Scheme, 1971, and Employees' Pension Scheme, 1995 (EPS-95). The new scheme has been brought under the Code on Social Security, 2020, and came into effect from the date of its publication in the gazette on June 29, 2026.
In the new EPS pension scheme, while some provisions such as pension formula, employee and employer contributions, minimum pension remain unchanged, provisions such as pension processing, pension fund investment and a 12% interest if a claim is delayed by the EPFO without sufficient reason have changed.
Who can join the EPS 2026 scheme?
As per the notification, the one who becomes a member of the Employees' Provident Funds Scheme, 2026, or the provident fund of the establishment on or after June 29, 2026, and whose wages on such a date is less than or equal to the wage ceiling notified by the central government.
An employee who has been a member of the erstwhile Employees’ Pension Scheme, 1995 or was entitled to become a member of the Employees’ Pension Scheme, 1995 or Employees' Family Pension Scheme, 1971, before the date of commencement of this scheme, are also eligible to join the new EPS pension scheme.
Here's a look at other key changes in the EPS 2026 scheme and what they mean for EPF subscribers.
Employees' Pension Scheme, 2026 replaces earlier EPS pension schemes
Employees' Pension Scheme, 2026 replaces Employees' Pension Scheme, 1995
and Employees' Family Pension Scheme, 1971. However, the government has clarified that pensions already sanctioned under the earlier schemes will continue without interruption. Existing pensioners will continue to receive their benefits.
Has the EPS pension formula changed?
There is no change in the method of calculating pension. Monthly pension will continue to be calculated using the same formula:
Monthly Pension = (Pensionable salary × pensionable service) ÷ 70
Pensionable salary will continue to be the average monthly salary drawn during the last 60 months before exiting the pension fund.
Has the EPS contribution structure changed under the new EPS-2026?
There is no change in the contribution process. Employers will continue to contribute 8.33% of the employee’s wages, subject to the notified wage ceiling. The government will also continue to contribute 1.16% of the employee’s wages, also subject to the wage ceiling.
For employees who opted for a higher pension following the Supreme Court judgment, the scheme is formally added in this provision. In such cases, the employer's contribution to the pension fund increases to 9.49% because of the additional contribution on salary exceeding Rs 15,000, as per the notification.
Who is eligible for a monthly pension under EPS 2026?
The eligibility rules remain unchanged. A member becomes eligible for a superannuation pension after completing at least 10 years of eligible service and attaining the prescribed retirement age. Members completing 10 years of service can also opt for an early pension from the age of 50.
Can you take an early pension under EPS-2026?
Members can start receiving an early pension from the age of 50 years after completing service of at least 10 years. However, the pension amount will be reduced by 4% for every year it is drawn before the normal retirement age.
What happens if you leave your job before completing 10 years?
Members with less than 10 years of eligible service will continue to have two options:
Receive a withdrawal benefit, or obtain a scheme certificate so that the service can be added if they join another EPF-covered establishment later.
Does EPS-2026 increase the minimum pension?
The notification does not announce any increase in the minimum EPS pension. The minimum member pension continues to remain Rs 1,000 per month, subject to the existing conditions.
Is there a clarity on pension claims settlement days?
As per the EPS-2026 notification, EPFO must either settle a complete pension claim within 20 days or inform the applicant about any deficiencies within the same period.
What is the interest for delayed EPS claims settlement?
If a complete pension claim is delayed without sufficient reason, interest at 12% per annum will be payable on the benefit amount. The amount will be recovered from the salary of the responsible EPF commissioner.
Higher pension provisions incorporated into EPS 2026 scheme
The higher pension option, which emerged after the Supreme Court's judgment, has now been formally included in the scheme itself, providing greater legal clarity.
Is there any change in family pension and disability pension under EPS-2026?
The scheme continues pension benefits for eligible family members, including:
Spouse
Children
Orphans
Disabled children
Nominee (in specified cases)
Dependent parents, where applicable
If a deceased member is not survived by any widow, but is survived by children and where the widow pension is not payable, such children will get a monthly orphan pension equal to 75% of the monthly widow pension.
A member who becomes permanently and totally disabled during service will continue to be eligible for disability pension even without completing the normal qualifying service, provided at least one month's contribution has been credited to the pension fund.
In the new EPS pension scheme, while some provisions such as pension formula, employee and employer contributions, minimum pension remain unchanged, provisions such as pension processing, pension fund investment and a 12% interest if a claim is delayed by the EPFO without sufficient reason have changed.
Who can join the EPS 2026 scheme?
As per the notification, the one who becomes a member of the Employees' Provident Funds Scheme, 2026, or the provident fund of the establishment on or after June 29, 2026, and whose wages on such a date is less than or equal to the wage ceiling notified by the central government.
An employee who has been a member of the erstwhile Employees’ Pension Scheme, 1995 or was entitled to become a member of the Employees’ Pension Scheme, 1995 or Employees' Family Pension Scheme, 1971, before the date of commencement of this scheme, are also eligible to join the new EPS pension scheme.
Here's a look at other key changes in the EPS 2026 scheme and what they mean for EPF subscribers.
Employees' Pension Scheme, 2026 replaces earlier EPS pension schemes
Employees' Pension Scheme, 2026 replaces Employees' Pension Scheme, 1995
and Employees' Family Pension Scheme, 1971. However, the government has clarified that pensions already sanctioned under the earlier schemes will continue without interruption. Existing pensioners will continue to receive their benefits.
Has the EPS pension formula changed?
There is no change in the method of calculating pension. Monthly pension will continue to be calculated using the same formula:
Monthly Pension = (Pensionable salary × pensionable service) ÷ 70
Pensionable salary will continue to be the average monthly salary drawn during the last 60 months before exiting the pension fund.
Has the EPS contribution structure changed under the new EPS-2026?
There is no change in the contribution process. Employers will continue to contribute 8.33% of the employee’s wages, subject to the notified wage ceiling. The government will also continue to contribute 1.16% of the employee’s wages, also subject to the wage ceiling.
For employees who opted for a higher pension following the Supreme Court judgment, the scheme is formally added in this provision. In such cases, the employer's contribution to the pension fund increases to 9.49% because of the additional contribution on salary exceeding Rs 15,000, as per the notification.
Who is eligible for a monthly pension under EPS 2026?
The eligibility rules remain unchanged. A member becomes eligible for a superannuation pension after completing at least 10 years of eligible service and attaining the prescribed retirement age. Members completing 10 years of service can also opt for an early pension from the age of 50.
Can you take an early pension under EPS-2026?
What happens if you leave your job before completing 10 years?
Members with less than 10 years of eligible service will continue to have two options:
Does EPS-2026 increase the minimum pension?
The notification does not announce any increase in the minimum EPS pension. The minimum member pension continues to remain Rs 1,000 per month, subject to the existing conditions.
Is there a clarity on pension claims settlement days?
As per the EPS-2026 notification, EPFO must either settle a complete pension claim within 20 days or inform the applicant about any deficiencies within the same period.
What is the interest for delayed EPS claims settlement?
If a complete pension claim is delayed without sufficient reason, interest at 12% per annum will be payable on the benefit amount. The amount will be recovered from the salary of the responsible EPF commissioner.
Higher pension provisions incorporated into EPS 2026 scheme
The higher pension option, which emerged after the Supreme Court's judgment, has now been formally included in the scheme itself, providing greater legal clarity.
Is there any change in family pension and disability pension under EPS-2026?
The scheme continues pension benefits for eligible family members, including:
Children
Orphans
Disabled children
Nominee (in specified cases)
Dependent parents, where applicable
If a deceased member is not survived by any widow, but is survived by children and where the widow pension is not payable, such children will get a monthly orphan pension equal to 75% of the monthly widow pension.
A member who becomes permanently and totally disabled during service will continue to be eligible for disability pension even without completing the normal qualifying service, provided at least one month's contribution has been credited to the pension fund.
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