51 Lakh More Employees to Come Under Social Security Net with New EPFO Wage Limit
The Union Cabinet has approved raising the wage limit for mandatory coverage under the Employees' Provident Fund Organisation (EPFO) from ₹15,000 to ₹25,000 per month. This move is expected to bring over 51 lakh additional employees under the ambit of mandatory social security coverage.
For employees earning between ₹15,000 and ₹25,000 per month, this change could mean access to provident fund savings, pension benefits, and insurance protection under applicable EPFO schemes. Previously, new employees earning more than ₹15,000 were not required to be mandatorily enrolled in the EPF system.
This decision is particularly significant for low- and middle-income employees, for whom long-term savings and pension security can ensure better financial stability post-retirement. The raised limit also means that social security coverage will better reflect current wage levels, which have risen over the past decade.
The wage limit was last revised in September 2014, when it was raised to ₹15,000. Since then, wages and formal employment have expanded across various sectors.
The government estimates that this measure will increase its annual expenditure on EPFO support from the current ₹10,250 crore to approximately ₹11,339 crore. The estimated expenditure over five years is around ₹56,696 crore.
The EPFO currently has approximately 7.98 crore contributing members across about 7.68 lakh establishments. Its pension scheme provides benefits to around 82 lakh pensioners.
The Ministry of Labour and the EPFO will now take the necessary administrative and legal steps to implement this decision.