The Supreme Court has asked the Central Government to review and revise the Employees’ Provident Fund (EPF) wage ceiling, unchanged for over 11 years, ensuring broader coverage and social security for millions of workers.
Thank you for reading this post, don't forget to subscribe!
NEW DELHI: The Supreme Court of India has directed the Central Government to decide within four months regarding the revision of the wage ceiling for the Employees’ Provident Fund Scheme (EPF), which has remained unchanged for over 11 years. This comes after a plea by social activist Naveen Prakash Nautiyal, highlighting that employees earning more than ₹15,000 per month are currently excluded from EPF coverage.
The Employees’ Provident Fund Organisation (EPFO) administers social security schemes for employees in the organized sector. One of its key schemes, the Employees’ Provident Fund (EPF), is designed to provide retirement benefits and financial security to workers.
However, the wage ceiling for EPF contributions has remained at ₹15,000 per month despite significant inflation and increases in minimum wages across India. As a result, employees earning above this limit are excluded from availing the benefits of the scheme, reducing its effectiveness as a social security measure.
“The failure to revise the wage ceiling has deprived large sections of the workforce of essential social security benefits,”
said the petitioner’s lawyers, Pranav Sachdeva and Neha Rathi.
Nautiyal’s plea seeks enforcement of Articles 14 and 21 of the Constitution, which guarantee equality and the right to life, citing the arbitrary and inconsistent revision of the wage ceiling under the Employees’ Provident Fund Scheme, 1952.
The plea also highlighted that the wage ceiling has historically been revised inconsistently, sometimes after 13-14 years, without any linkage to economic indicators such as:
- Inflation rates
- Minimum wages
- Per capita income
- Consumer price index
This irregular approach, according to the petitioner, has contradicted the social security objectives of the EPF Act.
The petition submitted a detailed statistical analysis showing that the EPF wage ceiling revisions over the past 70 years have been inconsistent with economic metrics such as:
- Minimum pay of central government employees
- Income tax exemption limits
- Annual growth rate in per capita net national income
- Minimum wages and annual inflation rates
“While the wage ceiling remains at ₹15,000, minimum wages in several parts of India are much higher, leading to reduced coverage of the scheme,”
the petition noted.
The analysis also highlighted a shift from inclusivity to exclusion over the last three decades. Initially, the EPF scheme covered a large proportion of workers, but today, the number of eligible employees has significantly decreased due to the outdated wage ceiling.
The EPFO’s Sub-Committee on Enhancing Coverage and Managing Related Litigation submitted a report in 2022 recommending:
- Enhancing the wage ceiling
- Reducing coverage thresholds
- Enrolling all employees as EPF members up to the wage ceiling
The recommendations were approved by the Central Board (EPF) in July 2022 but are still pending consideration by the Central Government.
ALSO READ: Employees Can’t Be Denied Promotion Due to Administrative Delay: Delhi High Court
The Supreme Court bench, comprising Justices J K Maheshwari and A S Chandurkar, directed the petitioner to submit a representation to the Central Government within two weeks. The government is now expected to decide on the wage ceiling revision within four months.
