EPFO may hike wage ceiling to Rs. 25,000, says report

• 29 Oct 2025
• 249 Views

The Employees’ Provident Fund Organisation (EPFO) is reportedly considering raising the wage ceiling to Rs. 25,000 for the compulsory inclusion of workers in the Employees' Provident Fund (EPF) and the Employees' Pension Scheme (EPS), according to a report by Moneycontrol. 

The Central Board of Trustees of the EPFO is likely to discuss this matter in its upcoming meeting, scheduled for December this year or January next year, as mentioned by an official quoted by Moneycontrol. 

A final decision on the new EPFO rule could be made during this meeting. Currently, the EPFO wage ceiling stands at Rs. 15,000 per month. If approved, the new rule could potentially benefit an additional 10 million employees. 

Moneycontrol reported quoting the official, “As per an internal assessment of the labour ministry, the Rs. 10,000 per month increase in the wage ceiling would make social security benefits mandatory for over 10 million more individuals.” The official further mentioned that many employees in metro cities get more than Rs. 15,000 basic pay, which makes it optional for them to be an EPFO member.

The report said, citing the individual, “The labour unions have been seeking a raise (on wage limit) for a long time as monthly salaries of several low or mid-skilled workers in many metro cities are more than 15,000 per month. A higher ceiling would make them part of EPFO.”

EPFO Wage Ceiling Details

The EPFO wage ceiling refers to the highest monthly basic salary on which mandatory Provident Fund and Employees' Pension Scheme contributions are calculated under the authority of the retirement funds body. Employees who earn more than Rs. 15,000 in basic pay have the option to opt-out of the EPF and EPS schemes. 

As such, employers are not required to register these employees or make PF contributions on their behalf. If an employee's basic salary is Rs. 15,000 or less, enrollment in the EPF and EPS is mandatory. Both the employer and the employee must contribute 12% of the employee's salary to the Provident Fund.

EPFO New Rules

Earlier this month, the Employees' Provident Fund Organization (EPFO) approved new liberalized rules for partial withdrawals for its over seven crore subscribers. Under the new provisions, members are required to maintain a Minimum Balance of 25 percent of their contributions in their accounts at all times. Employees can withdraw the remaining 75 percent.

Additionally, the EPFO has changed the waiting period for availing of a premature final settlement of the Employees' Provident Fund from existing 2 months to 12 months and for final pension withdrawals, the waiting period has been extended from 2 months to 36 months.

Source: 

• Moneycontrol

• Livemint