The uploaded FAQ identifies Notification S.O. 5109(E), dated 17 September 2026, as revising the EPFO statutory wage ceiling from ₹15,000 to ₹25,000 per month. The Ministry of Labour and Employment’s announcement confirms the revised ceiling and effective date.
The change widens the wage threshold for mandatory coverage under the EPF, EPS and EDLI framework. The Government estimates that more than 51 lakh additional employees may come within mandatory coverage, subject to the applicable statutory and scheme conditions.
Who may be covered under the new ₹25,000 EPF ceiling?
Employees with applicable statutory wages above ₹15,000 and up to ₹25,000 may fall within the expanded coverage. The FAQ states that eligible employees already working on 17 September 2026 should be enrolled from that date. The employer is responsible for enrolment; the employee does not need to submit a separate application.
Coverage is determined with reference to the applicable definition of “wages” under section 2(88) of the Code on Social Security, 2020 and relevant scheme provisions. The ₹25,000 ceiling is not the same as gross salary.
For example, the FAQ distinguishes between an employee with gross salary of ₹50,000 and applicable wages of ₹25,000, and an employee with gross salary of ₹60,000 and applicable wages of ₹30,000. Employers should assess each employee using the relevant wage components and membership rules.
EPF contribution impact: ₹20,000 wage example
For applicable wages of ₹20,000 for a full month, the FAQ illustrates the following monthly contributions:
Contribution | Rate | Amount |
|---|---|---|
Employee’s EPF contribution | 12% | ₹2,400 |
Employer’s EPS contribution | 8.33% | ₹1,666 |
Employer’s EPF contribution | 3.67% | ₹734 |
EDLI contributions and EPF administrative charges are additional. The employer’s contribution is divided between EPF and EPS, subject to EPS eligibility and the applicable scheme provisions.
The increased ceiling does not mean every employee must contribute on ₹25,000. Contributions depend on the applicable wages, membership status and scheme rules. The FAQ also states that existing arrangements for contributions on higher wages are not automatically reduced to ₹25,000 solely because the ceiling has changed.
September 2026 payroll and ECR
As the revised ceiling took effect during September, employers should calculate contributions for the applicable periods separately:
1–16 September 2026: Earlier ceiling of ₹15,000.
17–30 September 2026: Revised ceiling of ₹25,000.
The FAQ states that September contributions should be reported in one ECR, calculated to reflect the applicable periods. The September ECR is ordinarily due by 15 October 2026.
If the additional employee share could not be deducted from September salary, the FAQ says recovery may be deferred to the next payroll cycle for take-home salary purposes without prior approval from the Inspector-cum-Facilitator. The ECR and full statutory remittance for September must still be completed by the due date.
EPS membership: check prior service separately
The FAQ addresses employees who are EPF members but were not EPS members. It says eligible affected employees may become EPS members from 17 September 2026, with EPS contributions starting from that date.
However, the FAQ does not expressly explain how service before 17 September 2026—when an employee was not an EPS member—is treated for pensionable service. It does not, by itself, confirm whether that earlier period counts toward qualifying EPS service or is excluded. Check the employee’s EPS membership and service record before drawing a conclusion about pension eligibility.
Other important points from the FAQ
A higher contribution wage may increase EPF accumulation and may affect EPS pensionable wages. The actual pension depends on pensionable wages, pensionable service and applicable EPS conditions; an increase is not automatic for every member.
The FAQ states that the maximum EDLI assurance benefit remains ₹7 lakh under the scheme described in the document.
It states that the Government’s EPS contribution remains limited to 1.16% of wages up to ₹15,000 per month, or ₹174 per member.
The employer’s statutory contribution is distinct from the employee’s contribution. It should not simply be treated as an employee deduction by describing it as part of CTC.
Employers should review contractor compliance where contract labour is engaged.
Employer compliance checklist
Employers should identify employees in the ₹15,000–₹25,000 wage band, check existing PF and EPS membership, verify statutory wage components, update payroll systems and calculate the September transition contributions. They should reconcile payroll data with the ECR, retain supporting calculations and monitor further EPFO directions or portal instructions.