The Ministry of Labour and Employment is revisiting a long-pending proposal to raise the salary ceiling for Provident Fund coverage. Recent wage hikes have raised concerns that a significant number of employees could fall outside the ambit of social security coverage. Under the Employees' Provident Fund Organisation (EPFO), the wage ceiling could be raised from the current ₹15,000 per month to between ₹25,000 and ₹30,000 per month. The need for this reconsideration arose following substantial wage increases for industrial workers in the National Capital Region (NCR). Consequently, many skilled workers risk being excluded from mandatory EPFO ​​coverage, potentially undermining the government's objective of 'Universal Social Security.'

**ESIC Also Considering Raising Limits**

Officials are also considering raising the wage ceiling under the Employees' State Insurance Corporation (ESIC) to align both schemes, thereby facilitating better compliance and improving the 'Ease of Doing Business.' The current wage ceiling under ESIC stands at ₹21,000 per month. A senior government official told *ET* that the Ministry has taken cognizance of recent wage hikes in certain states and is currently assessing the impact of these changes on social security coverage for the affected employees. The official added that internal discussions on the matter are underway, and the Ministry is expected to secure the necessary approvals shortly before initiating comprehensive consultations with all relevant stakeholders to finalize the new wage limits.

**Increased Pressure on Employers**

Raising the wage ceiling for mandatory contributions under the EPFO ​​would expand its coverage, bring more employees into the formal workforce, and boost their retirement savings. However, this move could place some financial strain on employers' balance sheets. An official stated that raising the salary limit would have a significant financial impact on employers; therefore, the government wishes to involve all concerned stakeholders in this process before formally presenting a proposal to the EPFO's Central Board of Trustees to seek its approval.

**Supreme Court Had Also Issued a Warning**
The government had previously considered raising the salary limit under the EPFO ​​to bring it on par with that of the ESIC. The last revision to the EPFO's salary limit was carried out in 2014, when it was increased from ₹6,500 per month to ₹15,000 per month. This initiative to revise the salary limit has now gained fresh momentum, as the Supreme Court recently emphasized the necessity of updating this threshold to keep pace with rising wage rates and inflation. The Court warned that, due to the existing limit, an increasingly large segment of the workforce is falling outside the ambit of social security coverage.

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