The Employees’ Provident Fund Organisation (EPFO) has increased the wage ceiling for mandatory coverage from ₹15,000 to ₹25,000 per month. The revised limit came into effect on September 17, 2026, expanding access to provident fund, pension and insurance benefits for employees earning between ₹15,000 and ₹25,000 a month. The government expects more than 51 lakh additional employees across the country to come under mandatory EPFO coverage.
The increase is the first revision of the EPFO wage ceiling since September 2014. Under the earlier limit, PF contributions for employees covered at the statutory ceiling were calculated on a maximum wage of ₹15,000. With the new ceiling, the contribution base has increased to ₹25,000.
For example, where contributions are restricted to the statutory ceiling, an employee contribution at 12% rises from ₹1,800 on ₹15,000 to ₹3,000 on ₹25,000. The employer’s contribution is also affected, including the portion allocated towards the Employees’ Pension Scheme (EPS).
More Employees to Come Under EPFO Coverage
The revised wage ceiling is expected to bring a large number of employees who were previously outside mandatory EPFO coverage into the social security system.
Employees joining a job with monthly wages between ₹15,000 and ₹25,000 were previously outside mandatory EPF coverage under the earlier ceiling, subject to the applicable rules. With the new limit, this salary group will now come within the statutory framework for EPF, EPS and EDLI coverage.
The change is also expected to increase retirement savings and strengthen pension and insurance coverage for eligible employees. However, employees who were already contributing on their actual higher wages may see little or no change in their total PF contribution because they were already contributing above the earlier statutory ceiling.
According to the information provided in the source article, more than 50,000 additional employees in the Lucknow division could benefit from the wider coverage. The division includes Lucknow, Rae Bareli, Sitapur, Hardoi and Barabanki districts.
How the EPS Pension Calculation Works
The increase in the wage ceiling can also affect the pensionable salary used for EPS calculations. The pension amount depends on pensionable service and pensionable salary, subject to the applicable EPS rules.
For example, if an employee has completed 10 years of service under a ₹6,500 salary ceiling and another 10 years under a ₹15,000 ceiling, the pension calculation would take the relevant pensionable service and salary limits for the respective periods into account.
The EPFO wage ceiling has changed several times over the years. It stood at ₹5,000 before 2000, increased to ₹6,500 between 2001 and 2014, and was raised to ₹15,000 from September 2014. From September 17, 2026, the ceiling has been increased to ₹25,000.
Employees who have contributed under different salary ceilings during different periods will therefore have their pension determined according to the applicable pensionable salary and service for those periods.
EDLI Insurance Benefit Also Linked to Higher Ceiling
The higher EPFO wage ceiling also affects the Employees’ Deposit Linked Insurance (EDLI) component. Where the statutory ceiling applies, the EDLI contribution at 0.50% increases from ₹75 on a ₹15,000 wage ceiling to ₹125 on the new ₹25,000 ceiling.
The EDLI scheme provides insurance protection to eligible EPFO members. In the event of an employee’s death while in service, the applicable insurance benefit is paid to the eligible nominee or family members according to the scheme’s rules.
The increase in the wage ceiling therefore changes more than just the PF contribution. For newly covered employees, it expands access to EPF, EPS and EDLI benefits while raising the statutory contribution base from ₹15,000 to ₹25,000.