EPFO: There’s good news for millions of employed people in the country whose salaries exceed Rs 15,000. They will soon begin receiving PF benefits. The issue of raising the salary limit under the Employees’ Provident Fund Organization (EPFO) has once again become a hot topic. This proposal has been pending for a long time. Currently, the salary limit is Rs 15,000, which the government is considering raising to the Rs 25,000-30,000 range.

What does it mean for working people?

If the government does this, millions of additional workers will be covered by PF, especially middle-class workers earning between Rs 15,000 and Rs 30,000 per month. More people will save for retirement, leading to better pensions and financial security.

Wage ceiling refers to the salary limit up to which employees working in companies covered by EPFO ​​are required to contribute money to the retirement fund (PF). Currently, this limit is Rs 15,000 per month. This means that if your basic salary + DA is more than Rs 15,000, then contributing to PF is not mandatory. You can do it if you wish or not. However, if your monthly basic salary + DA is Rs 15,000 or less, then PF contribution is mandatory.

Indeed, if the EPF salary limit is raised, millions of new employees could be covered by the provident fund. PF contributions will be made from their monthly salaries. Although their in-hand salary will decrease, a strong fund will be created for retirement. Furthermore, they will also receive financial security after changing jobs or retiring. Along with EPF, employees will also receive the benefits of EPS pension and EDLI insurance. This decision will be very beneficial for employees who work for very low salaries; they will be able to build a substantial fund for the future.

This limit was set in September 2014 and has remained unchanged for over 11 years, despite rising salaries across sectors. Labor unions have long demanded that this limit be raised, as inflation and rising salaries have excluded millions of workers from social security. Significant changes have occurred in the salary structure since 2014. In many states, the minimum monthly wage for unskilled laborers has now exceeded Rs 15,000. This means that millions of low-paid and minimum-wage workers are excluded from mandatory PF coverage. Labor unions have long argued that this old limit weakens social security. Therefore, it should be raised.