PF Wage Ceiling is now Rs 25,000: What employers must do for the September 2026 ECR

For twelve years, Rs 15,000 was the number every payroll team knew by heart. From 17 September 2026, it is Rs 25,000. The Ministry of Labour and Employment notified the revised wage ceiling under the Code on Social Security, 2020 (S.O. 5109(E), dated 17 September 2026), a day after the Union Cabinet approved it.

The change sounds simple, but it lands in the middle of a wage month, and that is where most of the questions are coming from. Here is what changes, and what to do before the September ECR is filed on 15 October.

What exactly changed

• Mandatory coverage. Employees earning up to Rs 25,000 a month (basic plus DA, as "wages" is now defined) must be covered by EPF. Earlier the limit was Rs 15,000. The government expects over 51 lakh more employees to come under PF, pension and EDLI.
• Pension (EPS). The employer's 8.33% share to EPS is now calculated on wages up to Rs 25,000, so the maximum EPS contribution rises from Rs 1,250 to about Rs 2,083 a month. The rest of the employer's 12% continues to go to EPF.
• EDLI and administration charges are calculated on the revised ceiling as well.
• ESI is unchanged: the Rs 21,000 threshold and the 0.75% / 3.25% rates stay as they are.

Who is affected

1. Employees earning between Rs 15,000 and Rs 25,000 who were outside PF. They now fall under mandatory coverage from 17 September. They need a UAN and should be included in the September ECR from that date.
2. Existing members whose employer restricted contributions to Rs 15,000. The restricted base moves up to Rs 25,000, which raises both the employee and employer contributions for anyone earning above Rs 15,000.
3. EPF members earning Rs 15,000 - 25,000 who were not in EPS. Since pension eligibility followed the old ceiling, some members in this band were contributing only to EPF. Check each case and enrol them in EPS where the rules now require it.
4. Employers already contributing on full wages. EPF is unaffected, but the EPS share still moves to the new cap, so the EPS/EPF split changes.

The September split: one ECR, two ceilings

September 2026 has two periods:

• 1 - 16 September: contribution on the old Rs 15,000 ceiling
• 17 - 30 September: contribution on the new Rs 25,000 ceiling

Both go in a single September ECR , due 15 October. Many payroll teams are working it out in proportion to the days in each period. For example, for an employee with a basic plus DA of Rs 30,000 whose PF is restricted to the ceiling:

Employee PF at 12% is about Rs 2,360. EPS at 8.33% is about Rs 1,638, and the employer's balance of Rs 722 goes to EPF.

Before you file, confirm the calculation method against EPFO's own circular and FAQs for the revised ceiling, and keep a working note for each employee. If an inspector asks later, the working matters as much as the number.

A checklist for the September payroll

1. List every employee with wages between Rs 15,000 and Rs 25,000 and check their PF and EPS status.
2. Generate UANs for newly covered employees and collect their KYC.
3. Update the PF ceiling in your payroll software and decide how September is handled. Some employers choose to apply Rs 25,000 for the whole month, which is fine for EPF as a higher contribution, but check that the EPS (pension) share for 1 - 16 September stays within the Rs 15,000 ceiling.
4. Revise the salary structures of affected employees. Take-home pay drops for anyone newly covered or whose restricted base rises, so tell them before payday.
5. Re-check CTC costing: the employer's cost goes up by 12% of the extra PF wage (plus EDLI and admin charges).
6. File the single September ECR by 15 October 2026, and from October use Rs 25,000 for the whole month.

The part clients will ask you about

Employees usually ask why their take-home fell. The honest answer is that more of their salary is now being saved for them, in EPF and a larger pension, and the employer is contributing more too. It's worth putting that in writing before the September payslip goes out.

The author is the founder of HivePayroll, payroll software for Indian companies that calculates PF, ESI, PT, LWF and TDS. He writes about payroll compliance for employers and practitioners.