JSA Prism | Employment Law | July 2026

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Ministry of Labour and Employment notifies schemes under the Code on Social Security, 2020

On June 29, 2026, the Central Government, through the Ministry of Labour and Employment, notified 3 (three) social security schemes under Chapter III of the Code on Social Security, 2020 (“SS Code”), namely:

• the Employees’ Provident Funds Scheme, 2026 (“PF Scheme 2026”);
• the Employees’ Pension Scheme, 2026 (“Pension Scheme 2026”); and
• the Employees’ Deposit-Linked Insurance Scheme, 2026 (“EDLI Scheme 2026”) (collectively referred to as the “2026 PF Schemes”).

The 2026 PF Schemes replace and consolidate the framework previously governed by the Employees’ Provident Funds Scheme, 1952 (“PF Scheme 1952”), the Employees’ Family Pension Scheme, 1971, Employees’ Pension Scheme, 1995 (“EPS 1995”), and the Employees’ Deposit Linked Insurance Scheme, 1976 (“EDLI 1976”), respectively. Their notification introduces new compliance forms, reporting obligations, timelines, and enhanced accountability measures for both employers and authorities administering benefits under the afore-mentioned schemes.

As a general rule, the 2026 PF Schemes apply to establishments covered under Chapter III of the SS Code, including establishments employing 20 (twenty) or more employees (“Covered Establishments”), subject to the statutory thresholds, exclusions, exemptions, and wage ceilings prescribed under the SS Code. Further, their applicability must, be examined in conjunction with the provisions relating to ‘excluded employees’ and voluntary coverage, as provided under the SS Code.

Applicability and coverage

PF Scheme 2026

The PF Scheme 2026 applies to Covered Establishments, including establishments owned or controlled by the Central or State Governments, provided that their employees are not already entitled to contributory provident funds or old-age pension benefits under any other law.

Membership is mandatory for every employee employed in or in connection with a Covered Establishment from the date the scheme becomes applicable to the establishment or the date of joining, whichever is later. It also continues the membership of all persons covered under the erstwhile PF Scheme, 1952. The PF Scheme 2026 is expressly subject to Sections 20[1], 21[2], and 143 of the SS Code[3], which deal with statutory exclusions, the maintenance of separate provident fund arrangements by eligible establishments, and exemptions, respectively.

The employees whose wages exceed the ‘notified wage ceiling’ under Section 2(89) (i.e., INR 15,000[4] (Indian Rupees fifteen thousand) per month) of the SS Code are treated as ‘excluded or exempted employees’ and are generally outside the scope of mandatory coverage. However, similar to the PF Scheme 1952, such employees and their employers may jointly opt for coverage under Paragraph 9(4) of the PF Scheme 2026.

Pension Scheme 2026

In addition to the Covered Establishments, coverage may extend to establishments brought within the ambit of the SS Code through a voluntary agreement between the employer and a majority of employees or through a Central Government notification under Sections 1(5)[5] and 1(6)[6] of the SS Code respectively. Once covered, an establishment continues to remain subject to Chapter III of the SS Code notwithstanding any subsequent reduction in employee strength, in terms of Section 1(8) of the SS Code.[7]

The coverage of the Pension Scheme 2026 extends to employees who become a member of the PF Scheme 2026, or an establishment with an exempted provident fund under Section 143 of the SS Code, on or after the notification of the scheme, provided their wages do not exceed the notified wage ceiling (i.e., INR 15,000 (Indian Rupees fifteen thousand) per month) under the SS Code. The Pension Scheme 2026 also preserves the membership of individuals covered under the erstwhile EPS 1995 and the Employees’ Family Pension Scheme, 1971.

Its applicability is further limited by Section 20 of the SS Code.

EDLI Scheme 2026

The EDLI Scheme 2026 similarly applies to all the Covered Establishments.

A member has been defined to include all members of the PF Scheme 2026, including members of provident funds exempted under Section 143 of the SS Code, who is required to become a member of the EDLI Scheme 2026.

An establishment may be exempted from the EDLI Scheme 2026 where it provides a group insurance policy offering benefits that are superior to those available under the scheme. To secure such exemption, the employer must demonstrate majority employee consent, obtain an Insurance Regulatory and Development Authority of India (“IRDAI”) approved policy for all its employees, certify that the alternative arrangement is more beneficial, and ensure that employees are not required to contribute towards the premium.

The EDLI Scheme 2026, similar to the PF Scheme 2026 and Pension Scheme 2026, is subject to the exclusions under Section 20 of the SS Code and operates subject to the notified wage ceiling of INR 15,000 (Indian Rupees fifteen thousand) per month for the purposes of mandatory employer contributions.

Compliance themes for employers

PF Scheme 2026

• The employer is required to contribute 12% of the employee’s wages, except in the case of establishments notified by the Government, where the applicable contribution rate is 10%. The employee is generally required to make a matching contribution at the same rate.
• Where an employee’s monthly wages exceed the statutory wage ceiling of INR 15,000 (Indian Rupees fifteen thousand) per month, the employer’s and employee’s mandatory contributions can be limited to the amount payable on the wage ceiling. However, the employer and employee may jointly elect, in writing, to contribute on wages exceeding the statutory wage ceiling. In such cases, the employee may make voluntary contributions on the higher wages, and the employer may, at its discretion, make a corresponding contribution on the additional amount, or continue to contribute at 12% of the wage ceiling. The employer is not under any statutory obligation to match the employee’s voluntary contributions made in excess of the wage ceiling. Either the employer or the employee may, at any time, elect to reduce or discontinue such additional voluntary contributions.
• The employers must formally authorise up to 5 (five) employees of the establishment to sign returns and documents. These signatories’ actions are legally binding on both the employer, and the establishment and the details of this authorisation must be submitted in the prescribed form.
• The employers must also furnish details of all the branches and departments, including the names of people in ultimate control of those branches, in the prescribed form along with documentary proof for authenticating the identity of such people.
• The principal employers are mandated to register their establishment and declare all engaged contractors on the Employees’ Provident Fund Organization (“EPFO”) portal in the prescribed form.
• The contractors are jointly and severally liable with the principal employer for the payment of contributions and applicable charges in respect of contractual employees engaged by them and must ensure that such contributions and charges are remitted within the time prescribed under the PF Scheme 2026.
• A new 5 (five) year limitation period has been introduced to initiate proceedings regarding membership disputes.
• The employers are now liable to pay a late fee of INR 500 (Indian Rupees five hundred) per day for delays in filing any return required under the PF Scheme 2026.
• For defaults in paying contributions, the Central Provident Fund Commissioner may levy damages based on the duration of the delay:
  • 0.25% for delays of less than 2 (two) months;
  • 0.50% for delays between 2 (two) and 4 (four) months; and
  • 1% for delays exceeding 4 (four) months.
• Every employer must facilitate a Universal Account Number (“UAN”) generation in case an employee fails to do so on the portal and provide necessary digital facilities and technical support to download e-passbooks.
• The PF Scheme 2026 mandates that declarations and nominations be completed electronically through the designated portal.
• The employers must upload the details of employees leaving within the preceding month within 15 (fifteen) days of the close of every month.
• The PF Scheme 2026 also provides 3 (three) specific ‘campaigns’ to allow establishments to settle historical defaults:
  • the Employees’ Enrolment Campaign (“EEC”), 2026 (valid until October 31, 2026): Under this, employers can enroll employees who joined between April 1, 2009, and March 31, 2026, with nominal damages of only INR 100 (Indian Rupees one hundred).
  • VISHWAS, 2026: This is a 6 (six) month (beginning from the notification of this scheme i.e., June 29, 2026) settlement scheme for damages related to defaults in payment of contributions occurring prior to June 14, 2024.
  • Amnesty, 2026: This is a 6 (six) month (beginning from the notification of this scheme i.e., June 29, 2026) window for exempted establishments to regularise historical non-compliances.

Pension Scheme 2026

• Out of the contributions payable by the employer, a part of such contribution i.e., 8.33% of the employee’s wages (up to the notified wage ceiling i.e., INR 15,000 (Indian Rupees fifteen thousand) per month) is required to be remitted to the Pension Fund.
• These contributions, along with the cost of remittance, must be borne by the employer and paid within 15 (fifteen) days of the close of every month.
• The principal employer is responsible for paying contributions for every member, whether they are employed directly or through a contractor.
• For members who, with effect from September 1, 2014, exercised the joint option to contribute on actual wages exceeding the statutory ceiling under the erstwhile EPS, 1995, the employer’s contribution is fixed at 9.49% of actual salary. Every employer must send a consolidated return as specified in the PF Scheme 2026 containing details of all eligible employees and their wages within 15 (fifteen) days of the Pension Scheme 2026 becoming applicable to their establishment.
• Employers are required to make registers and books of accounts available electronically under due authentication for verification by the inspector-cum-facilitator during inspection of the establishment.
• Employers must furnish exhaustive details to the commissioner regarding the establishment’s branches, departments, and details of those who have ultimate control over the affairs of the establishment, including directors, partners, and managers.
• Establishments seeking to operate their own pension schemes under Section 143 of the SS Code must adhere to strict parity and reporting standards, as exemptions are only granted where the internal scheme provides benefits at par with or more favourable than the statutory Pension Scheme 2026.
• Employers of exempted establishments, along with their board of trustees, are required to submit a monthly return to the commissioner.

EDLI Scheme 2026

• Employers are required to electronically pay the contribution and administrative charges to the insurance fund within 15 (fifteen) days of the close of every month.
• The EDLI Scheme 2026 explicitly prohibits employers from deducting the insurance contribution from the wages of employees or recovering it in any other manner. This reinforces Section 16(1)(c) of the SS Code, which mandates that the employer bears the liability for the insurance fund.
• The employer is responsible for paying contributions to employees directly employed as well as those employed by or through a contractor.
• Every employer must send a consolidated return of all eligible employees to the commissioner within 15 (fifteen) days of the EDLI Scheme 2026 commencement.
• Employers are required to electronically upload details of new members and employees leaving service on the designated portal within 15 (fifteen) days of the close of each month.
• Under Paragraph 24 of the EDLI Scheme 2026 and Section 123 of the SS Code,[8] establishments must maintain records and registers (including muster rolls and wage details) electronically or otherwise as specified by the appropriate Government. These must be produced before a commissioner or inspector-cum-facilitator, upon demand.
• Employers with a valid EDLI exemption under the erstwhile EDLI 1976 can continue under the exemption and seek renewal. All other establishments must transition to un-exempted status and begin depositing EDLI contributions from the applicable effective date.
• Exemptions under the EDLI Scheme 2026 require the consent of a majority of employees and the purchase of an IRDAI-approved group insurance policy. The employer must certify that the private benefit is ‘more beneficial’ than the statutory scheme and that employees pay no premium. These exemptions are valid for 3 (three) years. The applications for renewal must be submitted to the specified portal at least 6 (six) months before the existing exemption expires. If the insurance provider fails to pay the assurance benefit, the employer of the exempted establishment is bound to pay the benefit themselves.
• The exempted establishments must submit monthly online returns, which include tracking grievances and claim settlement percentages.

Conclusion

Given the emphasis on digital governance and stricter enforcement under the 2026 PF Schemes, the employers should promptly review their social security processes, payroll structures, contractor arrangements, exempted fund structures, and record-keeping mechanisms.

The PF Scheme 2026 also gives the employers a one-time opportunity to regularise historical defaults through the EEC, VISHWAS, and Amnesty campaigns before the new enforcement framework takes full effect. Therefore, employers with legacy provident fund gaps should assess their eligibility and act within the prescribed timelines.

This Prism is prepared by:

Preetha Soman Partner

Madhur Khandelwal Principal Associate

Rebecca Thomas Senior Associate

Nandini Singh Associate

For more details, please contact km@jsalaw.com.

[1]Section 20 of the SS Code excludes certain establishments (e.g., small cooperative societies, and government establishments whose employees already have contributory PF/pension benefits) and employees already receiving PF benefits under other Central or State enactments, from Chapter III, and allows the Central Government to grant further exemptions.

[2]Section 21 of the SS Code allows the Central Government to authorise an employer, on joint application with a majority of employees of an establishment with 100 (one hundred) or more persons, to maintain its own provident fund account, subject to prescribed conditions, with authorisation barred in cases of recent defaults or offences and liable to cancellation for non-compliance.

[3]Section 143 of the SS Code empowers the appropriate Government to grant, renew, or cancel exemptions from the SS Code or its schemes, subject to prescribed conditions, prior consultation with the central board or corporation, and parity of employee benefits; exempted establishments must constitute a board of trustees and comply with prescribed accounting, reporting, and inspection requirements.

[4] By way of notification dated May 29, 2026, the ‘wage ceiling’ notified under Section 2(89) of the SS Code is INR 15,000 (Indian Rupees fifteen thousand).

[5]Section 1(5) of the SS Code allows the Central Provident Fund Commissioner to extend Chapter III to an establishment by notification where the employer and a majority of employees agree, and to similarly withdraw such applicability on a subsequent joint request.

[6]Section 1(6) of the SS Code empowers the Central Government to extend the SS Code to any establishment by notification, after 2 (two) months’ prior notice.

[7]Section 1(8) of the SS Code provides that an establishment to which Chapter III applies continues to be covered even if its employee strength later falls below the prescribed threshold.

[8]Section 123 of the SS Code requires employers to maintain prescribed records and registers (including muster rolls, wages, and workforce details), display prescribed notices, issue wage slips, and file returns within prescribed timelines.