The Union Cabinet has raised the mandatory EPFO wage ceiling after more than a decade, bringing millions of additional salaried workers under provident fund, pension and insurance coverage.
Highlights:
- EPF wage ceiling increased from ₹15,000 to ₹25,000 per month.
- More than 51 lakh additional employees expected to come under mandatory EPFO coverage.
- The wage ceiling was last revised in September 2014.
- Employees earning ₹15,000–₹25,000 per month are expected to benefit.
- Annual government expenditure is estimated at ₹11,339 crore.
- Five-year expenditure is estimated at around ₹56,696 crore.
The Union Cabinet has approved an increase in the wage ceiling for mandatory coverage under the Employees’ Provident Fund Organisation (EPFO) from ₹15,000 to ₹25,000 per month. The decision is expected to bring more than 51 lakh additional employees under the social security framework.
The EPFO wage ceiling was last increased to ₹15,000 in September 2014. Under the existing framework, a fresh employee joining employment at a wage above ₹15,000 per month is not automatically covered under mandatory EPF provisions. With the ceiling now raised to ₹25,000, employees earning between ₹15,000 and ₹25,000 per month are expected to come under mandatory coverage.
Eligible employees will get access to savings under the Employees’ Provident Fund (EPF), pension protection through the Employees’ Pension Scheme (EPS) and insurance protection under the Employees’ Deposit Linked Insurance Scheme (EDLI), subject to applicable scheme provisions.
The government estimates annual expenditure of around ₹11,339 crore due to the measure, while the estimated expenditure over five years is approximately ₹56,696 crore.
EPFO currently has around 7.98 crore contributing members across nearly 7.68 lakh contributing establishments. The Ministry of Labour and Employment and EPFO will now undertake the necessary statutory and administrative steps to implement the revised wage ceiling.
