EPS 2026 replaces EPS-71, EPS-95: What has changed in new EPFO pension scheme and what remains the same

The Ministry of Labour and Employment has notified the Employees' Pension Scheme (EPS), 2026, which takes the place of the earlier Employees' Pension Scheme, 1971, and Employees' Pension Scheme, 1995 (EPS-95). This new scheme is now part of the Code on Social Security, 2020, and came into effect from June 29, 2026, the date of its publication in the gazette.

In the new EPS pension scheme, some provisions like pension formula, employee and employer contributions, and minimum pension remain unchanged. However, changes have been made to areas like pension processing, how the pension fund is invested and a new rule that offers 12% interest if a claim is delayed by the EPFO without a valid reason.

Who can join the EPS 2026 scheme?

According to the notification, anyone who joins the Employees' Provident Funds Scheme, 2026, or the provident fund of the establishment on or after June 29, 2026, and whose wages on that date are at or below the wage ceiling notified by the central government is eligible.

Also read: EPF Scheme 2026 replaces EPF Scheme 1952: Have EPF interest rate, contribution and wage ceiling changed?

An employee who has been a member of the erstwhile Employees' Pension Scheme, 1995 or was eligible to become a member of the Employees' Pension Scheme, 1995 or Employees' Family Pension Scheme, 1971, before this new scheme starts, are also eligible to join the new EPS pension scheme.


Here's a look at the other key changes in the EPS 2026 scheme and what they mean for EPF subscribers.

Employees' Pension Scheme, 2026 replaces earlier EPS pension schemes

Employees' Pension Scheme, 2026 replaces Employees' Pension Scheme, 1995 and Employees' Family Pension Scheme, 1971. However, the government has clarified that pensions already sanctioned under the earlier schemes will continue without interruption. Existing pensioners will continue to receive their benefits.

Has the EPS pension formula changed?

There is no change in the method of calculating pension. Monthly pension will continue to be calculated using the same formula:
Monthly Pension = (Pensionable salary × pensionable service) ÷ 70
Pensionable salary will continue to be the average monthly salary drawn during the last 60 months before exiting the pension fund.

Has the EPS contribution structure changed under the new EPS-2026?

There is no change in the contribution process. Employers will continue to contribute 8.33% of the employee's wages, subject to the notified wage ceiling. The government will also continue to contribute 1.16% of the employee's wages, also subject to the wage ceiling.


For employees who opted for a higher pension following the Supreme Court judgment, the scheme is formally added in this provision. In such cases, the employer's contribution to the pension fund increases to 9.49% because of the additional contribution on salary exceeding Rs 15,000, as per the notification.

Who is eligible for a monthly pension under EPS 2026?

The eligibility rules remain unchanged. A member becomes eligible for a superannuation pension after completing at least 10 years of eligible service and attaining the prescribed retirement age. Members completing 10 years of service can also opt for an early pension from the age of 50.

Can you take an early pension under EPS-2026?

Members can start receiving an early pension from the age of 50 years after completing service of at least 10 years. However, the pension amount will be reduced by 4% for every year it is drawn before the normal retirement age.

What happens if you leave your job before completing 10 years?

Members with less than 10 years of eligible service will continue to have two options:
Receive a withdrawal benefit, or obtain a scheme certificate so that the service can be added if they join another EPF-covered establishment later.

Does EPS-2026 increase the minimum pension?

The notification does not announce any increase in the minimum EPS pension. The minimum member pension continues to remain Rs 1,000 per month, subject to the existing conditions.

Is there a clarity on pension claims settlement days?

According to the EPS-2026 notification, EPFO must either settle a complete pension claim within 20 days or inform the applicant about any deficiencies within the same period.

What is the interest for delayed EPS claims settlement?

If a complete pension claim is delayed without sufficient reason, interest at 12% per annum will be payable on the benefit amount. The amount will be recovered from the salary of the responsible EPF commissioner.


Higher pension provisions incorporated into EPS 2026 scheme
The higher pension option, which emerged after the Supreme Court's judgment, has now been formally included in the scheme itself, providing greater legal clarity.

Is there any change in family pension and disability pension under EPS-2026?

The scheme continues pension benefits for eligible family members, including:
Spouse
Children
Orphans
Disabled children
Nominee (in specified cases)
Dependent parents, where applicable


If a deceased member is not survived by any widow, but is survived by children and where the widow pension is not payable, such children will get a monthly orphan pension equal to 75% of the monthly widow pension.


A member who becomes permanently and totally disabled during service will continue to be eligible for disability pension even without completing the normal qualifying service, provided at least one month's contribution has been credited to the pension fund.

Investment of Pension Fund

As per the notification, the assets of the pension fund already invested in the public account of the central government will remain invested.


The future contributions of the central government accruing to the pension fund from April 1, 2026, onwards shall be invested in the public account, and the central government will pay interest at a rate not less than 8.5%.

Key changes in EPS-2026

Pension claims to be settled within 20 days
12% interest for delayed claims
Higher pension provisions incorporated into the scheme
Minimum return on government contribution
Digital compliance for employers
Scheme name is changed to Employees' Pension Scheme, 2026 from Employees' Pension Scheme, 1995

Comparison between EPS 2026

Topic	EPS-95	EPS-2026	What changed?
Legal framework	Under EPF & MP Act, 1952	Under Social Security Code, 2020	Major legal change
Scheme name	Employees' Pension Scheme, 1995	Employees' Pension Scheme, 2026	Renamed
Pension formula	Pensionable Salary × Service ÷ 70	Same formula	No change
Employer contribution	8.33%	8.33%	No change
Government contribution	1.16%	1.16%	No change
Higher pension	Added after Supreme Court judgment	Incorporated into the scheme	Clarified
Pension processing	No fixed timeline	Claim disposal within 20 days	New service standard
Delay by EPFO	No explicit penalty	12% interest if claim is delayed without sufficient reason	New safeguard
Investment of Pension Fund	Existing provisions	Minimum 8.5% return guaranteed on Government contribution invested in Public Account	New provision