The Social Security Framework of 2026: New Compliance Obligations

India’s provident fund, pension and employee deposit-linked insurance framework is being recast under the Code on Social Security, 2020. The Ministry of Labour and Employment has notified three replacement schemes:

• the Employees’ Provident Funds Scheme, 2026 (“EPF, 2026”),
• the Employees’ Deposit-Linked Insurance Scheme, 2026 (“EDLI, 2026”) and
• the Employees’ Pension Scheme, 2026 (“EPS, 2026”)

These schemes replace the earlier framework under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, while broadly preserving the familiar contribution structure.

The significance of the 2026 schemes lies less in the contribution rates and more in the compliance architecture around them. Employers will now need to engage with a framework that is more digital, more disclosure-oriented and more closely aligned with portal-based administration. For businesses with employees in India, this means reviewing not only payroll treatment, but also employee records, contractor reporting, ownership and management disclosures, electronic filings, exemption status and transition-related opportunities such as enrolment, damages settlement and regularisation mechanisms.

Let us now navigate through the changes introduced under the said Schemes of 2026 which are more evolutionary than revolutionary-

EPF, 2026

The EPF Scheme of 1952 was largely dependent on Form-based manual processes. Under the 2026 Scheme, the existing framework is retained, but it brings in several procedural changes which will require the companies to realign their compliance processes. Here is a comparative chart for the procedural differences under the new regime:

Additionally, the government has also rolled out transition initiatives, such as:

• Employees’ Enrolment Campaign 2026- Employers may enrol eligible employees who were not previously covered under EPF. (Annexure A – Employees’ Enrolment Campaign, 2026)
• VISHWAS 2026- A dedicated settlement mechanism has been introduced for specified damages-related cases. (Annexure B – VISHWAS, 2026).

As reporting shifts from standard reports to detailed corporate disclosures involving promoters, directors and managers across multiple units, compliance tracking becomes an issue of board-level risk. This is where an enterprise-wide legal risk management platform becomes vital. Komrisk centralizes compliance tracking across all operating entities and departments, providing chief compliance officers and boards with real-time status visibility to manage executive liability under their Risk Frameworks.

EDLI, 2026

The EDLI 2026 Scheme is where the employer-facing changes are most concrete. It replaces the 1976 Scheme and applies to establishments covered under Chapter III of the Code, including members of exempted PF trusts.

However, the following core obligations of the employer remain the same as earlier:

• It is explicitly provided that the employees make no contribution.
• To ensure the employer’s contribution is never recovered from employees’ wages.
• To remain responsible for contributions of employees engaged through contractors, not just direct employees.

While the payout is settled by the authorities, it is to be noted that a few changes have been incorporated in the benefit structure which shapes employee expectations:

• While calculating the provident fund accumulation in case of death of an employee, the average monthly wages will now be subject to a maximum of the wage ceiling notified by the Central Government. Earlier, the average monthly wages used to be subject to a maximum of Rs. 15 thousand.
• In case of payment of assurance benefit without a nominee, the exclusion of certain family members has been omitted.
• Now, claims may be filed online or offline in the prescribed manner [Para 23(1)]. However, as earlier, complete claims must be settled within 20 days, with delay attracting 12% penal interest recoverable from the concerned Commissioner.

EPS, 2026

It is largely a consolidated and streamlined version of the existing pension framework and not really a policy overhaul. The core principles governing pension eligibility, contributions, pension calculation, family pension, disability benefits and withdrawal benefits have been retained under the EPS 2026, while updating the Scheme to operate under the Social Security Code and making it more adaptable to future wage ceiling revisions. The incidental modifications under the new EPS include the following:

• Dynamic Wage Ceiling (Para 3 of Old Scheme, Para 4 of New Scheme) – The most significant structural change is that EPS 2026 adopts a dynamic wage ceiling mechanism. Unlike EPS 1995, which repeatedly referred to fixed monetary ceilings of Rs. 6,500 and later Rs.15,000 for determining contributions and pensionable salary, the new Scheme replaces these with references to the wage ceiling notified by the Central Government from time to time. Consequently, any future revision of the wage ceiling will automatically apply without requiring amendments to the Scheme.

• Higher Pension Contribution Incorporated [Para 4(2) Proviso in EPS, 2026 vs Para 11(4) in EPS, 1995] – Another notable change is the incorporation of provisions introduced after judicial and legislative developments. EPS 2026 expressly carries forward the post-2014 higher pension (joint option) framework, including the enhanced employer contribution of 9.49% on wages exceeding the notified ceiling for eligible members, reflecting the changes made following the Supreme Court’s decision on higher pension contributions.

• Migration to the Code on Social Security, 2020 (Para 1 of both Schemes) – References to the EPF & MP Act, 1952 have been replaced with references to the Code on Social Security, 2020 and the EPF Scheme, 2026.

• Recognition of International Workers (Para 2(1)(g) of New Scheme) – The Scheme now expressly defines and covers International Workers, including treatment of workers under Social Security Agreements.

• Updated Recovery Mechanism (Par 6 of New Scheme vs Para 5 of Old Scheme) – Recovery of damages for delayed contributions is now linked to the EPF Scheme, 2026, instead of prescribing a separate rate within the EPS.

• Simplification of Transitional Provisions (Para 6-7 of Old Scheme vs Para 7 of New Scheme) – Obsolete provisions relating to migration from the Employees’ Family Pension Scheme, 1971 to EPS 1995 and several other provisions have been removed or consolidated, without materially altering members’ substantive pension entitlements.

Bottom Line:

The three Schemes of 2026 retains the same rates, same ceiling, same coverage, but move decisively toward digital, time-bound and better-documented compliance management. For employers, the shifts are mainly procedural, i.e., electronic deposits within tight windows, monthly portal reporting, electronic record-keeping and disclosure. Therefore, the companies need to revisit their internal processes to align these with the new framework.

The new 2026 social security schemes prove that Indian employment regulation is moving toward absolute transparency and strict electronic auditing. Managing this requires a systemic legal risk strategy, not a scattered checklist.

Our Compliance management software, Komrisk eliminates manual tracking by automatically capturing real-time statutory updates and notifications, translating regulatory shifts into compliance adjustments, so your broader risk management matrix stays current. Request a Compliance management tool demo.

Author: Alishan Hossain, Dwaipayan Das, Gaurav Chakrabarti

Researched by: Amiya Mukherjee

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