The central government announced a major EPF decision during Vishwakarma Jayanti. The government increased the salary ceiling for EPF coverage. Earlier, employees with salaries up to ₹15,000 came under this limit. Now, the new monthly ceiling has increased to ₹25,000. Union Minister Ashwini Vaishnaw said the previous PF salary limit was fixed in 2014. The government changed this limit in September 2014.
Now, the revised limit will include more employees under provident fund rules. This decision aims to expand social security coverage.
51 Lakh Employees Will Receive Benefits
According to the government, around 51 lakh employees will benefit from the updated EPF limit. These workers fall within the ₹15,000 to ₹25,000 salary range.
Therefore, these employees will now enter the new PF coverage system. The government expects an annual expenditure of around ₹11,339 crore. The government had received this demand for a long time. Prime Minister Narendra Modi approved the proposal on September 16. Moreover, different ministries discussed the proposal in detail. The Expenditure Finance Committee recommended it during its meeting on June 16, 2026.
The estimated five-year expenditure under this decision will reach around ₹56,696 crore.
Employees Will Receive Three Major Advantages
The increased wage limit will provide employees with organised social security benefits. Workers will receive three major advantages under the updated system. First, employees will get regular savings through the Employees’ Provident Fund. Second, they will receive pension security through the Employees’ Pension Scheme.
Third, workers will get insurance protection through the Employees Deposit Linked Insurance Scheme. Additionally, pensionable salary and statutory contribution systems will become more aligned with current salary levels. The government said formal employment should include guaranteed and portable social security. The new system strengthens this approach.
Furthermore, the decision can benefit employers too. Wider social security coverage can improve employee confidence and help companies retain skilled workers.
EPFO Coverage Will Expand Further
The Labour Ministry believes this move will strengthen trust between companies and employees. The annual government spending will increase to around ₹11,339 crore. Currently, budgetary support stands near ₹10,250 crore. EPFO operates one of the world’s largest social security systems. According to recent figures, EPFO has around 7.98 crore contributing members. More than 7.68 lakh establishments are connected with the organisation.
Meanwhile, nearly 82 lakh pensioners receive benefits under the Employees’ Pension Scheme. The government stated that India’s workforce remains central to national growth. Therefore, expanding social security becomes necessary with rising incomes and formal employment.
The decision to raise the EPFO wage ceiling to ₹25,000 marks another step towards broader employee protection.
