Labour Ministry: PF Contributions Over ₹15,000 Wage Are Voluntary, No Take-Home Pay Cut
December 12, 2025
The Union Labour and Employment Ministry on Wednesday cleared the air on Provident Fund rules under new social security laws. It said contributions by employers and employees above the ₹15,000 monthly wage ceiling are voluntary. The Code on Social Security, effective from November 21, replaces several old laws including the Employees’ Provident Funds Act, 1952.
The Ministry posted on social media platform X that "there is no legal requirement" for contributions exceeding ₹15,000. Both employer and employee can agree to contribute voluntarily on wages beyond this limit. This means no automatic deduction or pay cut due to the new Codes.
Since September 2014, the ₹15,000 wage ceiling has been the norm. Recently, MPs from Kerala asked if this ceiling would increase to ₹30,000. Union Labour Minister Mansukh Mandaviya replied, "raising the wage ceiling for coverage under EPFO is done based on extensive stakeholders’ consultations, including trade unions and industry associations, as the same will have impact on the take-home salary of employees and on the hiring cost for employers."
Separately, pensioners under the Employees’ Pension Scheme have raised concerns. Despite a minimum pension set in 2014, many still get less than ₹1,000 monthly. Five organizations met in New Delhi demanding pension hikes.
The EPFO’s 2023-24 report shows 36.6 lakh pensioners receive pensions of ₹1,000 or less. The Employees’ Pension (1995) Coordination Committee recently urged Prime Minister Narendra Modi to include all eligible pensioners in higher pension slabs. They argued the EPFO has not enforced this since 2004.
The Ministry’s clear message: PF contributions above the wage limit are voluntary, and no one should fear cuts in take-home pay as the new social security laws take effect.
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Tags:
Provident Fund
Wage Ceiling
Epfo
Labour Ministry
Pension
Social Security Code
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