Cabinet Raises EPFO Wage Ceiling to ₹25,000 From ₹15,000

The Union Cabinet has approved raising the monthly wage ceiling for mandatory Employees’ Provident Fund Organisation (EPFO) coverage from ₹15,000 to ₹25,000, the government announced on September 16, 2026.

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The change is expected to bring more than 51 lakh additional employees under mandatory EPFO coverage.

The decision was taken by the Cabinet chaired by Prime Minister Narendra Modi on a proposal from the Ministry of Labour and Employment. The wage ceiling was last revised in September 2014, when it was increased to ₹15,000.

What the New EPFO Wage Ceiling Means

The government said the revised ceiling will bring a substantial number of employees earning between ₹15,000 and ₹25,000 a month within the mandatory social security framework, subject to applicable scheme provisions.

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The approval will expand access to the Employees’ Provident Fund (EPF), Employees’ Pension Scheme (EPS) and Employees’ Deposit Linked Insurance Scheme (EDLI), as applicable.

Also Read: New EPF Rule: PF Contributions Can Be Cut for 3 Months

The change is intended to bring the statutory coverage framework closer to current wage levels. For employees and employers, the key points are:

• The mandatory EPFO wage ceiling will increase from ₹15,000 to ₹25,000 per month.
• More than 51 lakh additional employees are expected to come under mandatory EPFO coverage.
• The revised ceiling will expand access to EPF, EPS and EDLI benefits, subject to the respective scheme rules.
• The government estimates an annual outgo of about ₹11,339 crore for the measure.

The government said wage growth, rising incomes and the expansion of formal employment since the previous revision were among the factors behind the increase.

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It also noted that minimum wages in several states and occupations have moved closer to the existing ₹15,000 ceiling.

Impact on HR and Employers

The revision will be relevant for HR and payroll teams with employees in the newly covered wage range. Companies will need to review employee coverage and related payroll processes once the revised ceiling becomes operational.

The proposal underwent inter-ministerial consultations and was recommended by the Expenditure Finance Committee at its meeting on June 16, 2026. The government estimates the expenditure at about ₹11,339 crore annually, compared with existing annual budgetary support of around ₹10,250 crore.

The estimated expenditure over five years is ₹56,696 crore.

The official release said EPFO currently has around 7.98 crore contributing members across about 7.68 lakh contributing establishments. The Employees’ Pension Scheme provides pension benefits to around 82 lakh pensioners.

The Cabinet announcement does not specify an effective date for the revised ceiling. The Ministry of Labour and Employment and EPFO will undertake the required statutory and administrative steps for implementation.