EPFO WAGE CEILING REVISED TO INR 25,000: WHAT THE SEPTEMBER 17, 2026 NOTIFICATION MEANS FOR EMPLOYERS
EPFO WAGE CEILING REVISED TO INR 25,000: WHAT THE SEPTEMBER 17, 2026 NOTIFICATION MEANS FOR EMPLOYERS Notification: S.O. 5109(E), Ministry of Labour and EmploymentDated: 17 September 2026Effect: Immediate, from the date of publication in the Official Gazette The Central Government has notified a new wage ceiling of INR 25,000 per month for the purposes of Chapter III (Employees’ Provident Fund) of the Code on Social Security, 2020 — up from the INR 15,000 figure that had stood since the Code’s contribution framework first came into force. The notification, issued in exercise of powers under Section 2(89) of the Code, supersedes the earlier notification S.O. 2702(E) dated 29 May 2026, which had carried forward the legacy INR 15,000 ceiling from the repealed EPF & MP Act, 1952. For every payroll and compliance team, this is the single most consequential PF change in over a decade. Here is what it actually does, and how it changes your monthly contribution math. What Exactly Has Changed Metric Old Position (S.O. 2702(E)) 29 May 2026 New Position (S.O. 5109(E) 17 Sept 2026 Statutory wage ceiling under Chapter III INR 15,000/month INR 25,000/month Applies to EPF, EPS and EDLI mandatory coverage and contribution cap Same Legal basis Section 2(89), Code on Social Security, 2020 Section 2(89), Code on Social Security, 2020 The ceiling is the wage figure used to determine (a) who is compulsorily covered as an “employee” for EPF/EPS/EDLI purposes, and (b) the maximum wage on which the statutory EPF & EPS diversion is calculated, unless a joint employer-employee request for contribution on higher wages is already on record. Who Is Affected The Contribution Structure, Unchanged in Method Nothing about how PF is computed has changed — only the wage figure used as the pension cap. The applicable components remain: Component Rate Reckoned On Paid By EPF (Employee share) 12% Wages Employee EPF (Employer share) 3.67% Wages Employer EPS (Pension) 8.33% Wages, capped at the wage ceiling Employer EDLI 0.5% Wages, capped at the wage ceiling Employer EPF Administrative Charges * 0.5% Wages Employer * min INR 500/month; INR 75 if no contributory member The employer’s EPS share is always carved out of its 12% contribution — it is not an additional outlay on top of 12%. What changes is simply that a larger slice of Wages (up to INR 25,000 instead of INR 15,000) is now available for that 8.33% pension diversion. Sample Calculation — Employee Drawing INR 25,000 (Wages) Head Formula Amount Employee EPF (12%) 12% × 25,000 INR 3,000 Employer’s total contribution (12%) 12% × 25,000 INR 3,000 — of which, EPS (8.33%, capped at ceiling) 8.33% × 25,000 INR 2,083 — of which, EPF (balance) 3,000 − 2,083 INR 917 EDLI (0.5%) 0.5% × 25,000 INR 125 EPF Admin Charges (0.5%) 0.5% × 25,000 = 125 INR 125 EDLI Admin Charges Waived NIL Total monthly employer outflow (this employee): EPS INR 2,083 + EPF INR 917 + EDLI INR 125 + Admin INR 125 = INR 3,250 (against INR 3,000 employer PF contribution plus statutory charges), over and above the employee’s own INR 3,000 deducted from salary. Before-and-After: The EPS Impact The most visible shift is in the pension component, since EPS alone is capped at the ceiling: Ceiling EPS Diversion (8.33%) Balance to EPF (of employer’s 12%) INR 15,000 (old) INR 1,250 INR 550 INR 25,000 (new) INR 2,083 INR 917 For any employee earning INR 25,000 or more in Wages, the statutory pension contribution rises by roughly INR 833 per month per employee — a figure payroll teams will want to build into budget projections immediately, since the notification takes effect from the date of Gazette publication, not from a future date. Compliance Checklist for Employers Legal Effective Date vs. Practical Payroll Implementation Strictly read, the notification splits September 2026 into two statutory periods for every establishment: contributions for wages up to 16 September must still be computed on the INR 15,000 ceiling, and contributions from 17 September onward must be computed on the INR 25,000 ceiling. That is the legally correct position, and it is the position an auditor or EPFO inspecting officer will apply if the month is ever scrutinised. In practice, however, this creates a real operational problem. Most payroll and compliance software is built to run one wage ceiling for an entire wage period — it is not designed to bifurcate a single calendar month into a “first 16 days at INR 15,000” segment and a “last 14 days at INR 25,000” segment for EPS/EDLI purposes. Very few systems can do this cleanly without manual workarounds or off-cycle correction entries. For this reason, many organisations will find it more workable to implement the revised ceiling from 1 September 2026 for the current wage month, rather than attempting a mid-month split, provided this is a considered internal call rather than a strict legal requirement. This has two practical advantages beyond the payroll-system constraint: The key point for compliance teams to hold onto: this is a matter of practical implementation, not a change in the legal position. The law is clear that the INR 15,000 ceiling applies through 16 September and the INR 25,000 ceiling applies from 17 September. Choosing to apply the new ceiling from 1 September (or any other administratively convenient date within the month) is a business decision driven by system limitations and CTC-restructuring convenience — it should be documented internally as such, and should never be presented as the legally mandated effective date. If audited, the underlying legal position under S.O. 5109(E) remains 17 September 2026. This note is for general informational purposes and does not constitute legal advice. Employers should assess the notification against their specific payroll structures and, where in doubt, seek a formal compliance opinion. Click here to read the notification.
Employees’ Enrolment Campaign (EEC) 2026: A One-Time Opportunity to Regularise Past EPF Non-Compliance
Employees’ Enrolment Campaign (EEC) 2026: A One-Time Opportunity to Regularise Past EPF Non-Compliance The Employees’ Provident Fund Organisation (EPFO) has introduced the Employees’ Enrolment Campaign, 2026 (EEC 2026), providing employers with a special opportunity to voluntarily enrol eligible employees who were previously left out of EPF coverage and regularise certain historical compliance gaps. The Campaign has been notified under the Code on Social Security, 2020, and provides a time-bound compliance window for establishments to address past omissions relating to employees who were not enrolled under the EPF framework despite being eligible. With the Campaign available only up to 31 October 2026, employers should review their historical employee records and assess whether they can benefit from this special compliance opportunity. What is the Employees’ Enrolment Campaign, 2026?The EEC 2026 is a special one-time compliance window introduced by EPFO to facilitate the enrolment of employees who were left out of EPF coverage during the prescribed historical period.Under the Campaign, employers may declare eligible employees who: The objective is to expand social-security coverage while giving employers an opportunity to regularise historical omissions through a simplified and concessionary mechanism. Important TimelineThe Campaign is time-bound.Campaign Period: 1 July 2026 to 31 October 2026The EPFO’s implementation instructions provide for the Campaign to cease on 31 October 2026. Employers should therefore complete their review and declarations well before the closing date rather than waiting until the final days. Who Can Benefit from EEC 2026?The Campaign is particularly relevant for establishments that have discovered historical instances where eligible employees were not enrolled under EPF.Importantly, the Campaign is not restricted only to establishments that have never been covered under EPF. The implementation framework permits employers to participate even where the establishment is already covered, subject to the prescribed conditions.For example, an establishment may discover during an internal payroll or compliance audit that certain employees who joined several years ago were omitted from EPF membership. If those employees satisfy the eligibility conditions and are still working with the establishment on the declaration date, the employer may examine whether their enrolment can be regularised through EEC 2026. What Period Does the Campaign Cover?One of the most significant features of EEC 2026 is the historical period covered.The Campaign permits enrolment of eligible employees who joined the establishment between:1 April 2009 and 31 March 2026and who were not enrolled earlier despite being required or eligible to be covered.This substantially extends the historical period that employers can review and potentially regularise. What Financial Relief Does the Campaign Provide?One of the major attractions of EEC 2026 is the relief available in respect of past employee contributions and damages, subject to the conditions of the Campaign. 1. Employee’s share may be waivedWhere the employee’s share of contribution was not previously deducted from the employee’s wages, the employee’s share is not required to be deposited under the Campaign framework.This can substantially reduce the immediate financial burden on the employer compared with a conventional historical EPF assessment where both employer and employee contributions may become payable. However, employers should carefully verify their payroll records before making a declaration, particularly where employee contributions may have actually been deducted in the past. 2. Employer’s contribution remains payableThe employer is required to deposit the applicable employer’s contribution along with the other amounts prescribed under the Campaign. The implementation instructions specify that the employer is liable for the employer’s share along with applicable interest, administrative charges and the prescribed lump-sum damages. 3. Damages are restricted to a nominal amountA particularly important benefit is the provision for lump-sum damages of ?100, subject to the applicability and conditions of the Campaign. This is intended to provide significant relief compared with the ordinary consequences of historical EPF defaults. How Does an Employer Avail the Campaign?Employers should approach the process systematically. Step 1 – Identify eligible employeesThe employer should first conduct an internal review of employee records for the period 1 April 2009 to 31 March 2026.The review should ideally cover: Step 2 – Verify continuing employmentThe Campaign requires the declared employee to be alive and working with the establishment on the date of declaration.Therefore, former employees who have already exited the establishment should not simply be included in an EEC declaration. The employer should carefully verify the employee’s current employment status before proceeding. Step 3 – Generate Face Authentication-based UANFor eligible employees who require UAN generation, the employer is required to facilitate generation of a Face Authentication Technology-authenticated UAN through the UMANG application.This is an important procedural requirement and should be completed before proceeding with the contribution and declaration process. Step 4 – File the ECR and make paymentThe employer is required to prepare and submit the applicable Electronic Challan-cum-Return (ECR) and make the prescribed payment.The EEC declaration is subsequently linked with the relevant Temporary Return Reference Number (TRRN) generated in connection with the ECR/payment process. Step 5 – Submit the EEC declarationThe employer must submit the declaration through the online EPFO facility in accordance with the prescribed procedure.The employer should retain supporting records, calculations, employee-wise details, ECRs, payment challans and declaration acknowledgements for future reference and compliance documentation. Multiple Declarations Are PermittedAnother useful feature of EEC 2026 is that multiple declarations are permitted.Therefore, employers do not necessarily have to identify and declare every eligible employee in one single exercise. However, employers should adopt a structured review process to ensure that eligible employees are not inadvertently omitted. What About Employees Who Have Already Left?This is an important limitation.The Campaign is intended for employees who are alive and continuing to work with the establishment on the date of declaration.The EPFO implementation instructions also clarify that no suo-motu action is to be initiated under the Campaign in respect of employees who had exited before the declaration.Accordingly, employers should not treat EEC 2026 as a general mechanism for regularising every historical employee who was omitted from EPF. What Should Employers Do Before Filing a Declaration?An EEC declaration should not be filed merely on the basis of an employee list.Employers should undertake a proper employee-wise and month-wise reconciliation wherever historical records are available.A practical review should include: This exercise can help reduce the risk of incorrect or inconsistent declarations. EEC 2026
EPFO Launches “VISHWAS, 2026”: A One-Time Opportunity for Employers to Settle EPF Damages at Reduced Rates
Circular on Launch of VISWAS, 2026 for amicable settlements of disputes relating to damages under Code on Social Security, 2020 EPFO Launches “VISHWAS, 2026”: A One-Time Opportunity for Employers to Settle EPF Damages at Reduced Rates What is VISHWAS, 2026?VISHWAS, 2026 is a one-time settlement scheme designed to reduce prolonged litigation and facilitate faster recovery of EPF dues while providing financial relief to employers.The scheme became effective from 29 June 2026 and will remain open for six months, making it available until 28 December 2026. The Employees’ Provident Fund Organisation (EPFO), vide Circular No. Compliance/E-1203096/2025 dated 09 July 2026, has operationalized “VISHWAS, 2026”, a special dispute resolution scheme notified by the Central Government on 29 June 2026.The scheme aims to provide employers with a unique opportunity to amicably settle disputes relating to damages levied under Section 14B of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (or Section 128 of the Code on Social Security, 2020) by offering substantially reduced rates of damages. Who Can Avail the Scheme?The scheme covers almost every stage of proceedings relating to damages under Section 14B, including: This broad applicability makes the scheme beneficial for a large number of establishments facing EPF damage proceedings. Reduced Rate of DamagesOne of the most significant benefits of VISHWAS, 2026 is the drastic reduction in damages for defaults that occurred prior to 14 June 2024. The revised rates are: Period of Default Rate of Damages Up to 2 months 0.25% per month More than 2 months but less than 4 months 0.50% per month More than 4 months 1.00% per month These rates are considerably lower than the damages generally imposed under the existing provisions, thereby offering substantial financial relief. Important ConditionsEmployers intending to opt for the scheme should note the following mandatory conditions: Treatment of Part PaymentsThe Circular also clarifies the treatment of cases where damages have already been paid partially. Appeals and Pre-DepositThe scheme also provides clarity regarding appeals where mandatory pre-deposits have already been made.Any amount deposited while filing an appeal will be adjusted against the liability computed under VISHWAS, 2026. If additional payment is required, the employer must deposit the balance amount. Excess deposits, however, are not refundable. Why Employers Should Consider VISHWAS, 2026For many establishments, EPF damage proceedings remain pending for years before the EPF Appellate Tribunal or various High Courts. During this period, litigation costs continue to increase and uncertainty remains.The VISHWAS Scheme provides several advantages: For employers who have pending Section 14B proceedings, the scheme presents an excellent opportunity to resolve disputes at a substantially lower financial burden. Action Points for EmployersBefore applying under the scheme, employers should: ConclusionThe introduction of VISHWAS, 2026 marks one of the most employer-friendly initiatives by the EPFO in recent years. By substantially reducing damages and encouraging voluntary settlement, the scheme seeks to balance compliance enforcement with ease of doing business. Employers with pending EPF damage matters should carefully evaluate the financial implications of the scheme and consider availing this limited-time opportunity before the scheme expires. Click here to read the notification.
