Union Cabinet approves EPFO wage ceiling hike to Rs 25,000

The Union Cabinet on Wednesday approved the enhancement of the wage ceiling for mandatory coverage under the Employees’ Provident Fund Organisation (EPFO) from Rs 15,000 to Rs 25,000 per month. At present, employees joining a job with a monthly wage above Rs 15,000 are not automatically covered under the Employees’ Provident Fund (EPF) framework. The revised ceiling will bring workers earning between Rs 15,000 and Rs 25,000 per month under the statutory social security system. Addressing the media after the cabinet meeting in New Delhi, Information and Broadcasting Minister Ashwini Vaishnaw said that the decision is expected to bring more than 51 lakh additional employees within the ambit of mandatory EPFO coverage, significantly widening social security protection for workers. The annual Government outgo is estimated at about 11 thousand 339 crore rupees. The move will extend benefits under the Employees’ Provident Fund Scheme, Employees’ Pension Scheme (EPS) and Employees’ Deposit Linked Insurance Scheme (EDLI), in accordance with applicable provisions.

VIDEO | When asked what the basis for the cap was, Union Minister Ashwini Vaishnaw said, "The basis for this cap is that the earlier salary ceiling of Rs 15,000 per month was established in September 2014. Since then, the average salary has increased significantly, and the cost… pic.twitter.com/ijqgMIfnGA

— Press Trust of India (@PTI_News) September 16, 2026

The proposal was recommended by the Expenditure Finance Committee on June 16, 2026, following inter-ministerial consultations. The annual government outgo is estimated at around Rs 11,339 crore, with the expenditure over five years projected at approximately Rs 56,696 crore. EPFO administers the EPF, EPS and EDLI schemes. It currently has around 7.98 crore contributing members across about 7.68 lakh contributing establishments. The EPS provides pension benefits to around 82 lakh pensioners.