New Delhi, September 16: The Union Cabinet, chaired by prime minister Narendra Modi, on Wednesday approved raising the wage ceiling for mandatory coverage under the Employees’ Provident Fund Organisation from Rs 15,000 to Rs 25,000 a month, a move expected to bring more than 51 lakh additional employees under mandatory EPFO coverage.
The wage ceiling had remained unchanged from 2004 to 2014, before being raised to Rs 15,000 in September 2014. The labour and employment ministry said the latest increase reflects sustained wage growth and the expansion of formal employment since then, with minimum wages in several states and occupations having moved closer to the earlier threshold.
Employees earning between Rs 15,000 and Rs 25,000 a month, who were previously not automatically covered, will now gain access to provident fund savings, pension protection under the Employees’ Pension Scheme and insurance cover under the Employees’ Deposit Linked Insurance Scheme.
The proposal was recommended by the Expenditure Finance Committee at a meeting on 16 June 2026. The government’s annual outgo on the scheme is estimated at about Rs 11,339 crore, against existing annual support of about Rs 10,250 crore, taking the five-year cost to approximately Rs 56,696 crore.
EPFO currently has around 7.98 crore contributing members across about 7.68 lakh establishments, with the Employees’ Pension Scheme covering around 82 lakh pensioners, according to government data.