NEW DELHI, SEPTEMBER 16, 2026 ; The Union Cabinet on Wednesday approved a significant expansion of mandatory social security coverage by raising the wage ceiling for Employees’ Provident Fund Organisation (EPFO) coverage from ₹15,000 to ₹25,000 per month.
The decision, approved by the Union Cabinet chaired by Prime Minister Narendra Modi, is expected to bring more than 51 lakh additional employees within the mandatory social security framework.
Union Minister Ashwini Vaishnaw announced the decision during a media briefing following the Cabinet meeting.
Employees Earning Up to ₹25,000 to Come Under Coverage
Under the existing threshold, employees joining an establishment with monthly wages exceeding ₹15,000 were not automatically covered by the EPF framework.
With the revised ceiling, employees earning between ₹15,000 and ₹25,000 per month will become eligible for mandatory coverage, subject to applicable statutory and scheme provisions.
The expanded coverage will provide access to key components of the EPFO social-security framework, including:
- Employees’ Provident Fund (EPF) for retirement savings
- Employees’ Pension Scheme (EPS) for pension benefits
- Employees’ Deposit Linked Insurance Scheme (EDLI) for insurance protection
The government said the measure is aimed at widening access to formal social security and strengthening long-term financial and retirement protection for workers.
Wage Ceiling Revised After 12 Years
The EPFO wage ceiling was last increased in September 2014, when it was raised to ₹15,000 per month.
The ceiling had remained unchanged between 2004 and 2014. The government said the latest revision takes into account sustained wage growth, increasing incomes and the expansion of formal employment over the past decade.
Government Estimates ₹56,696 Crore Expenditure Over Five Years
According to the government’s estimates, the annual government expenditure following the enhancement of the wage ceiling will be approximately ₹11,339 crore, compared with around ₹10,250 crore in existing annual budgetary support.
The estimated expenditure over a five-year period is approximately ₹56,696 crore.
The government expects the decision to further encourage the formalisation of employment and broaden workers’ access to portable statutory social-security benefits.
EPFO Covers Nearly 8 Crore Contributing Members
According to the latest EPFO figures cited by the government, the organisation currently has approximately 7.98 crore contributing members across around 7.68 lakh contributing establishments.
The Employees’ Pension Scheme provides pension benefits to approximately 82 lakh pensioners.
The latest decision is therefore expected to expand the reach of EPFO’s social-security architecture to a substantially larger section of India’s formal workforce.
Implementation to Follow Statutory Process
Following the Cabinet’s approval, the Ministry of Labour and Employment and EPFO will undertake the required statutory and administrative procedures to implement the revised wage ceiling.
The government said the measure is intended to strengthen social-security coverage, promote formal employment and provide greater long-term retirement security to workers whose monthly wages fall within the newly expanded coverage limit.
The Cabinet’s decision marks a major revision of the EPFO wage threshold after 12 years, potentially extending mandatory social-security protection to more than 51 lakh additional employees.
