Union Cabinet on 16.9.2026 approved increasing EPF threshold wages from existing Rs.15000 per month for an employee to fall within the ambit of EPF to Rs.25000 per month. The effctive date will be announced by EPFO.
-Employees with Wages upto Rs.25000 per month will be under coverage of EPF schemes.
-Employees drawing Wages above Rs.25000 and not member of EPFO would be eligible as excluded employees.
-Monthly contribution where employee is contributing on EPF threshold wages will go up from Rs.1800 to Rs.3000 for employer and employee contribution. If you are still working on your revised compensation structure, please factor his change.
-Similar increase in ESI threshold which is Rs.21000 per month presently is expected to bring parity in threshold between EPF and ESI and bring uniform compliance regime in future. This is likely as guidance only.
Ministry of Labour & Employment vide Notification dated 17th Sep 2026 appended below has revised the EPF threshold wages from 15,000 to Rs.25,000 effective 17.9.2026. What has changed is given below
Parameter
Up to 16 Sept 2026
From 17 Sept 2026
Statutory wage ceiling (EPF)
₹15,000 per month
₹25,000 per month
Mandatory coverage
Wages up to ₹15,000
Wages up to ₹25,000
Max. employee share (12%)*
₹1,800
₹3,000
Max. employer share to EPS (8.33%)
₹1,250
₹2,083
Max. employer share to EPF (3.67%)
₹550
₹917
EDLI (0.50%, capped at ceiling)
₹75
₹125
Admin charges @ 0.50%
₹75
₹125
EPF registered entities need to comply with above for contributions in September 2026.
Thanks for sharing your inputs on this. This is really helpful. Has the ministry or the EPFO communicated a tentative timeline when this would be effective?
Some queries and replies on revision in EPF threshold:
If organization’s policy is on contribution based on EPF threshold, what is the change and when should it be applied i.e. entire month of Sep 2026 or split?
Ans. Where employee and employer contribution is on Rs.1800 each PM i.e. 12% on Rs.15k, the contribution effective 17th Sep 2026 gets revised to Rs.3000 each PM i.e. 12% on Rs.25k. Legally the effective date is 17th Sep 2026 i.e.prorate upto 16.9.26 @1800 and from 17th Sep 2026 onward @3000. However, if operationally this is considered as a challenge, then the contribution for the month of Sep 2026 maybe made @3000 for ee and er contribution.
What if an organization is providing contribution on actual basic/basic plus DA?
Ans. The contribution after coming into force of Code on Social Security in Nov 2025 has to be based on Wages and not basic/basic plus DA unless that is the definition of Wages in the organization. Here contribution would be 12% each on Wages but now mandatorily covering all employees drawing Wages upto Rs.25k. If an employee was eligible as excluded employee due to Rs.15k threshold, such excluded employees upto Wages of Rs.25k will now be included.