top of page

By:

Sumit Ranjan Das

21 August 2024 at 4:08:59 pm

EPFO’s Big Wage-Band Reset

Twelve years is a long time for a wage ceiling to remain unchanged. The last revision came in September 2014, when the limit was raised from Rs.6,500 to Rs.15,000. Last week, the Union Cabinet approved another increase, taking the ceiling to Rs.25,000 a month with effect from 17 September 2026. The government’s estimate is that more than 51 lakh additional employees will come within mandatory EPFO coverage as a result of the change. For employers and payroll professionals, however, the...

EPFO’s Big Wage-Band Reset

Twelve years is a long time for a wage ceiling to remain unchanged. The last revision came in September 2014, when the limit was raised from Rs.6,500 to Rs.15,000. Last week, the Union Cabinet approved another increase, taking the ceiling to Rs.25,000 a month with effect from 17 September 2026. The government’s estimate is that more than 51 lakh additional employees will come within mandatory EPFO coverage as a result of the change. For employers and payroll professionals, however, the headline number is only the starting point. The more important questions are who will be covered, which wages will be taken into account and how the revised provisions will be implemented. Wage Ceiling The existing wage ceiling of Rs.15,000 a month is being raised by Rs.10,000, or 66.7 percent, to Rs.25,000. The change takes effect from 17 September 2026 and marks the first revision since September 2014. The government expects more than 51 lakh additional employees to be covered. Estimated expenditure is about Rs.56,696 crore over five years, while annual government outgo is expected to rise to approximately Rs.11,339 crore. The standard contribution remains 12 percent each from the employee and employer, subject to applicable provisions. The Cabinet said the decision will expand access to provident-fund savings, pension protection under the Employees’ Pension Scheme (EPS) and insurance protection under the Employees’ Deposit Linked Insurance Scheme (EDLI), in accordance with the applicable scheme provisions. The wage ceiling is not merely an administrative threshold. It determines the point at which mandatory EPF coverage applies under the existing framework. At present, a fresh employee joining employment at wages above Rs.15,000 a month is not automatically brought within mandatory EPF coverage and may remain outside mandatory provident-fund, pension and associated insurance protection, subject to applicable statutory provisions. The revised ceiling will bring a substantial section of employees earning between Rs.15,000 and Rs.25,000 within the mandatory coverage framework. The government has also quantified the fiscal impact. The estimated expenditure is about Rs.56,696 crore over five years, while annual government outgo is expected to rise to approximately Rs.11,339 crore, compared with existing annual budgetary support of about Rs.10,250 crore. The Labour Ministry has linked the revision to sustained wage growth, rising incomes and the continued expansion of formal employment since the previous revision in 2014. Payroll Illustration Consider an employee earning Rs.22,000 a month who becomes subject to mandatory coverage under the revised ceiling. At the standard 12 percent contribution rate, if the full eligible wage is used as the contribution base, the employee’s contribution would rise from Rs.1,800 to Rs.2,640 a month, while the employer’s contribution would similarly rise from Rs.1,800 to Rs.2,640. Total monthly contributions would therefore increase from Rs.3,600 to Rs.5,280 — a combined increase of Rs.1,680. However, this should not be treated simply as Rs.1,680 of additional employee savings. Contributions are allocated between EPF and EPS components as prescribed, with the EPF component accumulating in the employee’s account and the EPS component providing pension benefits subject to scheme conditions. The Rs.22,000 example is illustrative, not a universal payroll formula. The final treatment of wage components, existing employees in this band, EPS allocation and transitional matters will depend on the statutory notification and EPFO implementation instructions. For payroll professionals, the immediate task is to assess the operational impact. Key questions include the effective date for existing employees and new joiners, which wage components will count towards PF, whether the 10 percent concessional rate for notified establishments will continue, how the revised ceiling will interact with EPS pensionable wages, and what changes will be required in payroll systems. The Cabinet approval establishes the policy decision; the formal Gazette notification and EPFO instructions will determine how it is translated into payroll processes. The revised ceiling is the first increase since September 2014 and is expected to bring more than 51 lakh additional employees, particularly those in the Rs.15,000-Rs.25,000 wage band, under mandatory EPFO coverage. For them, the change can expand access to provident-fund savings, EPS pension and EDLI insurance, subject to scheme provisions. For employers, it means reviewing payroll costs, employee data, eligible wage components, contribution calculations and compliance systems. The government has described the move as part of efforts to extend statutory social security and strengthen formal employment. The policy has been announced. For payroll professionals, the next chapter is implementation. (The writer is a Cost and Management Accountant and founder of TaxoDas. Views personal

Indecision Kills Personal Branding

Writer: Divyaa Advaani 
Divyaa Advaani 
Jan 17, 2025
3 min read

Updated: Jan 20, 2025

Indecision Kills

In a world that celebrates clarity and confidence, hesitancy is a silent yet powerful force that can diminish your personal brand. When people dwell in the realms of “I’m not sure” or “maybe,” they unknowingly project uncertainty and unreliability—traits that can undermine the foundation of a strong personal brand. Your ability to make decisions and stand firm on them is not just a reflection of your leadership but also a testament to your personal brand’s strength.


Every interaction we have leaves an impression. Be it a professional email, a networking event, or a casual conversation, these moments contribute to how others perceive us. When you continuously oscillate between indecision and vague responses, it sends a message that you lack confidence or direction. In business, where trust and reliability are paramount, this can become a significant roadblock.


Imagine a scenario where a client approaches two service providers with the same inquiry. The first one confidently outlines a plan, clearly stating the next steps, while the second hesitates, replying with, “I’m not sure; let me think about it.” Even if both have the same expertise, the client is more likely to gravitate toward the first provider. Confidence fosters trust, and trust is the bedrock of all successful relationships—professional or personal.


Indecision can often stem from the fear of making mistakes or being judged. While this is natural, it’s important to remember that perfection is an illusion. The act of making a decision, even if it turns out to be less than ideal, demonstrates courage, responsibility, and accountability. These are the traits that elevate a personal brand, distinguishing you in a crowded and competitive world.


Being decisive doesn’t mean being impulsive or reckless. It means gathering information, weighing options, and then committing to a choice with confidence. In personal branding, this is particularly crucial because every decision you make—how you respond to challenges, present yourself, or communicate with others—forms part of the narrative others associate with you.


Hesitation and indecision don’t only affect how others perceive you; they also impact how you view yourself. Constantly second-guessing yourself leads to self-doubt, which becomes a self-fulfilling prophecy. The more uncertain you are, the more others will mirror that uncertainty, creating a cycle that can be hard to break.


One way to counter this is by setting clear priorities and aligning your decisions with them. For instance, if your personal brand is centred around being a thought leader in your industry, your choices should reflect expertise and foresight. Even in moments of ambiguity, acknowledging the uncertainty while showing a proactive approach—such as saying, “I’ll find out and get back to you”—conveys both honesty and determination.


During my recent trip to Australia, I was reminded of how decisiveness shapes impressions. Whether interacting with global clients or navigating unfamiliar professional terrains, I realized that certainty in communication was key to building trust and rapport. This was particularly evident when representing my personal brand on international platforms. A clear, confident tone opened doors and strengthened relationships that would have otherwise remained distant.


The next time you find yourself leaning on phrases like “I’m not sure” or “maybe,” pause and ask yourself: Is this hesitation necessary? Sometimes, it’s about silencing the inner critic and choosing to act decisively. Even if the outcome isn’t perfect, the act of making a choice positions you as someone who is reliable, proactive, and worth trusting.


Your personal brand isn’t defined by the absence of mistakes but by how you handle them and move forward. Decisiveness isn’t just about making choices—it’s about owning them. And in a world that often feels uncertain, those who lead with clarity and conviction stand out.


Make your decisions a reflection of your confidence, and watch as your personal brand strengthens, opening doors you never imagined.

You could be a part of my network by following me on my social media handles:


(The author is a personal branding expert. She has clients from 14+countries. Views personal.)

Comments

bottom of page