Despite demands from labour unions and employees’ representative bodies, the government has retained Rs 15,000 per month as the wage ceiling for the Employees’ Provident Fund Organisation (EPFO) under the Code on Social Security, 2020. The Ministry of Labour and Employment issued a notification on May 29, 2026, declaring Rs 15,000 per month as the wage ceiling for the purposes of Chapter III of Employees’ Provident Fund under the Code on Social Security, 2020.
This notification has been issued under Section 2(89) of the Code which defines ‘wage ceiling’, empowering the government to notify a salary threshold to determine the eligibility for membership under EPF and related schemes.
Chapter III of the Code governs the Employees’ Provident Fund (EPF), Employees’ Pension Scheme (EPS) and Employees’ Deposit Linked Insurance Scheme (EDLI).
Is there revision of wage ceiling?
The notification has not revised or enhanced the wage ceiling. It has only provided statutory recognition to the current threshold under the SS Code. By retaining the wage ceiling at Rs 15,000 per month, the government has maintained the status quo. This decision continues the statutory mandate where only employees earning up to Rs 15,000 are required to join the EPF and make mandatory contributions.
What is EPFO’s wage ceiling?
The pay ceiling is the statutory maximum limit for mandatory contributions to EPF, EPS and EDLI. The current EPF wage ceiling is Rs 15,000. EPF and EDLI contributions are not mandatory for employees earning more than Rs 15,000. However, they can join EPF and ELDI schemes if the employer approves.
Why were employee unions demanding increase in wage ceiling?
Various labour unions and employees’ representative bodies have been demanding the revision of the existing basic salary ceiling from Rs 15,000 to Rs 25,000 which would help bring more employees under the EPF umbrella.
Employee unions have been demanding an increase in wage ceiling citing rising inflation and inadequate pension amounts. As regards Rs 15,000 wage ceiling under the EPFO, the employee unions argue that the EPFO which administers social security schemes for employees, currently excludes from coverage those whose wages exceed Rs 15,000 per month. These employees are automatically excluded from the scheme even though their income levels may still qualify for social security coverage.
The EPFO currently excludes from coverage those whose salaries exceed Rs 15,000 per month. All employees with basic pay up to Rs 15,000 are required to contribute to the Employees’ Provident Fund. However, beyond this limit, EPF contributions are optional for those who joined after September 1, 2014.
In January this year, the Supreme Court directed the government to consider taking a decision on the issue of revision of the existing basic salary ceiling.
