The monthly wage limit for mandatory Employees’ Provident Fund Organisation () coverage was increased from ₹15,000 to ₹25,000, effective 17 September 2026.
According to the Ministry of Labour & Employment, the change is expected to extend statutory social security benefits to more than 51 lakh additional employees, particularly those earning between ₹15,000 and ₹25,000 a month who were previously outside mandatory coverage.
and are two distinct components of the retirement benefits framework. Now, EPFO has posted on X explaining the eligibility criteria for the Employees’ Pension Scheme (EPS).
According to EPFO’s post, “If your monthly salary is ₹25,000 or less, EPS membership is mandatory as per eligibility. If your monthly salary is more than ₹25,000, EPS membership is not mandatory.”
The post highlights how monthly wages and an employee’s previous EPS membership determine eligibility, as well as when contributions towards the pension scheme are required or may not be deducted.
What has EPFO clarified about EPS membership eligibility?
EPFO outlined two key conditions for determining EPS membership eligibility.
- If wages are ₹25,000 or less, EPS (Pension) membership is mandatory, and contributions shall be deducted.
- If wages are more than ₹25,000 and you were not an EPS member previously, you are not eligible for EPS membership, and contributions shall not be deducted.
This distinction means that salary alone does not determine eligibility in every case. An employee’s previous membership of EPS is also relevant when assessing whether they can become a member of the scheme.
How are employer contributions divided between EPF and EPS?
The Employees’ Provident Fund (EPF) and EPS are two components of the broader retirement savings framework. While EPF helps employees accumulate retirement savings, EPS provides pension benefits to eligible members.
Under the standard contribution structure, the employer contributes 12% of eligible wages towards EPF-related contributions. Of this amount, 8.33% of pensionable wages is allocated to EPS, subject to the applicable wage ceiling and scheme provisions. The balance is credited towards EPF.
For instance, if the applicable pensionable wage is ₹25,000 per month, the employer’s 12% contribution amounts to ₹3,000. The EPS allocation at 8.33% works out to ₹2,082.50, while the remaining ₹917.50 goes towards EPF.
However, these calculations illustrate the contribution split at the stated wage level. The actual allocation depends on the employee’s eligibility and the applicable EPF and EPS rules.
What should employees do if their EPS contributions are not deducted?
EPFO has advised employees to contact their employer first if EPS contributions are not deducted when wages are ₹25,000 or less, or are deducted despite their ineligibility for membership.
Employees should verify their membership history and applicable eligibility conditions before concluding that a contribution has been incorrectly withheld.
If the issue remains unresolved, employees can raise a grievance through the EPF i-Grievance Management System (EPFiGMS) portal.
Disclaimer: This is only for informational and educational purposes. Please consult a qualified expert for the latest laws and regulations.