EPFO says pension scheme (EPS) membership is mandatory if monthly salary is Rs 25,000 or less, and not mandatory above that

The Employees’ Provident Fund Organisation (EPFO), which runs the provident fund and pension schemes for private-sector workers, has said that membership of the Employees’ Pension Scheme (EPS) is mandatory if your monthly salary is Rs 25,000 or less, and not mandatory if it is above Rs 25,000. Reports say this follows the wage ceiling being raised from Rs 15,000 to Rs 25,000, effective 17 September 2026. EPS is the pension part of provident fund cover. It is paid for from the employer’s contribution to the employee’s provident fund, not from a separate deduction from the employee’s pay.

What EPFO is reported to have said

Outlook Money quotes EPFO’s post on X: “If your monthly salary is Rs 25,000 or less, EPS membership is mandatory as per eligibility. If your monthly salary is more than Rs 25,000, EPS membership is not mandatory.” Outlook Money also quotes a post it dates 3 October 2026: “If your wages were more than Rs 25,000 at the time of joining your first job, you are not eligible for EPS membership.”

• Salary up to Rs 25,000. EPS membership is mandatory, subject to eligibility conditions, according to Angel One and Outlook Money. Angel One’s example is a new employee earning Rs 20,000.
• Salary above Rs 25,000. EPS is not mandatory. Angel One reports that people already in EPS can stay in it if their pay later goes above the ceiling, for example someone who joined under the Rs 15,000 ceiling and now earns Rs 30,000.
• First job above the ceiling. Outlook Money reports that a person whose wages were above Rs 25,000 when they joined their first job is not eligible for EPS. It says the rules do not clearly state whether such a person can join EPS later at a job paying less.

Which “salary” counts

Upstox reports EPFO’s published questions and answers (FAQs) saying the test is EPF wages, not gross salary: “The wage ceiling and gross salary are not synonymous.” Upstox says EPF wages are basic pay plus dearness allowance (a cost-of-living payment) plus retaining allowance, and that house rent allowance, special allowances, bonus and overtime are excluded. By that reading, an employee with Rs 50,000 gross salary and Rs 25,000 of EPF wages must be a member of EPF, EPS and the insurance scheme EDLI, while an employee with Rs 60,000 gross and Rs 30,000 of EPF wages is not required to be.

Contribution split

Outlook Money reports the employer’s 12% contribution splits into 8.33% to EPS and 3.67% to EPF, while the employee’s 12% goes entirely to EPF. Angel One reports that the maximum monthly employer contribution to EPS rises from Rs 1,250 to Rs 2,083. That is 8.33% of Rs 15,000 and of Rs 25,000, a calculation on the reported rate.

Basis of these figures

The primary source, EPFO’s posts on X, could not be opened, so everything above comes from reports by Outlook Money, Angel One and Upstox, and has not been checked against EPFO’s own text or the Employees’ Pension Scheme 1995. The reports do not give a circular number. This article reports what was said and does not say whether any individual qualifies.