The Employees’ Provident Fund Organisation (EPFO) has introduced significant changes that will provide major relief to employees’ families and nominees. In a recent circular, the retirement fund body clarified that weekends, public holidays, and certain job-change gaps will now be treated as part of continuous service, while the minimum payout under the Employees’ Deposit Linked Insurance (EDLI) scheme has been increased to ₹50,000.
This move aims to address long-standing issues where EDLI death claims were either rejected or settled for lower amounts due to minor gaps in service that were earlier treated as breaks.
According to EPFO, it was observed that several EDLI death claims were denied or reduced because authorities considered short gaps—such as Saturdays, Sundays, or holidays between two jobs—as a break in service. In many cases, officials failed to properly assess the continuity of service before the member’s death, resulting in hardship for dependents and legal heirs.
To ensure fairness and uniformity, EPFO has now issued clear guidelines defining what qualifies as “continuous service” under the EDLI scheme.
Under the new clarification, weekends and holidays falling between two jobs will not be considered a break in service, provided the gap only includes such non-working days.
This includes:
Saturdays and Sundays
Weekly holidays declared by the establishment
National holidays
Gazetted holidays
State holidays
Restricted holidays
If an employee leaves one organisation and joins another covered under the EPF & MP Act, 1952, and the gap between exit and joining consists only of the above holidays, the service will be treated as continuous.
EPFO explained the issue with a practical example. Earlier, if an employee completed more than 12 months of service, resigned on a Friday, and joined a new company on the following Monday, the intervening Saturday and Sunday were treated as a break in service. This technical interpretation often led to denial of EDLI benefits.
With the new rule, such gaps will now be ignored, and the employee’s service will remain continuous for EDLI eligibility.
In another important relaxation, EPFO stated that a gap of up to 60 days between two employments will also be treated as continuous service for EDLI purposes. This provision is expected to benefit employees who take a short break while switching jobs, a common practice in today’s workforce.
Alongside the service continuity clarification, EPFO has enhanced the minimum EDLI payout benefit to ₹50,000 for nominees and legal heirs.
This minimum payout will now apply even if:
The member did not complete 12 months of continuous service
The average PF balance of the member was less than ₹50,000
Additionally, the minimum EDLI benefit will also be payable if the member’s death occurs within six months of the last PF contribution, provided the employee was still on the company’s payroll at the time.
The Employees’ Deposit Linked Insurance (EDLI) scheme provides financial support to the family of an EPF member in case of the member’s death during service. Since EDLI benefits are crucial for dependents during difficult times, rejection of claims on technical grounds had been a major concern.
By redefining continuous service and enhancing the minimum payout, EPFO aims to ensure that families are not deprived of financial assistance due to procedural or technical issues.
Experts believe these changes will significantly reduce disputes and delays in EDLI claim settlements. Treating weekends, holidays, and short job-change gaps as continuous service reflects modern employment realities and strengthens social security coverage.
Overall, the latest EPFO decision marks a pro-employee reform, offering greater financial protection and peace of mind to millions of salaried workers and their families across India.
