The new Employees’ Provident Funds Scheme 2026 provides that “the contribution payable in respect of a member shall be subject to the wage ceiling limit, notified by the Central Government from time to time”. Photo: epfo.gov.in
The Labour and Employment Ministry has made all contributions in the Employees’ Provident Fund (EPF) above the monthly wage ceiling of ₹15,000, which is beyond ₹1,800, voluntary under the new Employees’ Provident Funds Scheme 2026 notified on June 29, 2026.
Earlier, under the old scheme, the Employees’ Provident Funds Scheme 1952, the wage ceiling, which is ₹15,000 per month at present, was relevant at the time of joining a firm for providing the employee with mandatory social security cover.
All employees whose basic wages were up to ₹15,000 were mandatorily covered under the scheme and others had the option to join the social security schemes run by the Employees’ Provident Fund Organisation (EPFO), voluntarily.
Once covered under the scheme, employees used to contribute on their actual basic wages and employers used to match that contribution, which were even higher than the wage ceiling notified by the government from time to time.
The present wage ceiling of ₹15,000 was notified in 2014.
The new Employees’ Provident Funds Scheme 2026 provides that “the contribution payable in respect of a member shall be subject to the wage ceiling limit, notified by the Central Government from time to time.
“…Subject to the provisions contained in sub-paragraph (4) of paragraph 9, where the monthly wage of such a member exceeds the wage ceiling, the employer’s and employee’s contributions shall be limited to the contribution payable on the ‘wage ceiling’.”
Provided further that an employer may make such contribution for wages beyond the wage ceiling to the Pension Fund in respect of such cases, which have been permitted for contribution on higher wages under the Employee’s Pension Scheme, 1995, it also says.
However, it states that the employer’s contribution under this Scheme shall be at the rate of 12% of the wages payable to the employee to whom this Scheme applies, and the employee’s contribution shall be equal to the employer’s contribution in respect of such employee.
After the amendment to the Employees’ Pension Scheme in 2014, the contribution of 8.33% of basic wage to the Employees’ Pension Scheme by employers was restricted to the wage ceiling of ₹15,000 only (i.e ₹1,250 per month).
The excess amount contributed by the employers used to go to the EPF accounts of the employees as the contributions were made on actual wages, which were higher than the wage ceiling.
This overhaul of the clause in the new scheme will allow employees as well as employers to opt for contribution as a wage ceiling or on a higher actual basic wage that they are getting.
The Labour Ministry has not commented on the issue so far.
Published – July 02, 2026 10:48 pm IST
