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SUPREME COURT STRIKES DOWN THREE-MONTH AGE LIMIT ON MATERNITY BENEFITS FOR ADOPTIVE MOTHERS UNDER THE CODE ON SOCIAL SECURITY, 2020

In a recent and significant decision in Hamsaanandini Nanduri v. Union of India, [WRIT PETITION (C) NO. 960 of 2021] the Supreme Court of India has revisited the scope of maternity benefits available to adoptive mothers, bringing renewed attention to the constitutional values of equality, dignity, and child welfare within labour legislation.

The case concerned the validity of provisions under the Maternity Benefit Act, 1961, later incorporated under the Code on Social Security, 2020, which grant maternity leave to adoptive mothers only where the adopted child is below three months of age. The petitioner challenged this limitation, contending that such a restriction creates an arbitrary classification among adoptive mothers and fails to recognize the realities of the adoption process in India.

Significantly, the Supreme Court struck down the provision contained in Section 60(4) of the Code on Social Security, 2020, insofar as it imposes an age limit of three months on the adopted child for adoptive mothers to avail maternity benefits. The Court held that such a restriction is unconstitutional and violative of Article 14 of the Constitution of India and Article 21 of the Constitution of India.

While examining the issue, the Court acknowledged an important principle: motherhood cannot be confined solely to biological childbirth. The Court observed that adoptive mothers also require time to nurture, bond with, and integrate a child into the family environment. Emotional attachment, caregiving responsibilities, and the developmental needs of the child remain central considerations irrespective of biological ties.

EPFO WAGE CEILING REVISED TO INR 25,000: WHAT THE SEPTEMBER 17, 2026 NOTIFICATION MEANS FOR EMPLOYERS

Notification: S.O. 5109(E), Ministry of Labour and Employment
Dated: 17 September 2026
Effect: Immediate, from the date of publication in the Official Gazette

The Central Government has notified a new wage ceiling of INR 25,000 per month for the purposes of Chapter III (Employees' Provident Fund) of the Code on Social Security, 2020 — up from the INR 15,000 figure that had stood since the Code's contribution framework first came into force. The notification, issued in exercise of powers under Section 2(89) of the Code, supersedes the earlier notification S.O. 2702(E) dated 29 May 2026, which had carried forward the legacy INR 15,000 ceiling from the repealed EPF & MP Act, 1952.

For every payroll and compliance team, this is the single most consequential PF change in over a decade. Here is what it actually does, and how it changes your monthly contribution math.

What Exactly Has Changed

The ceiling is the wage figure used to determine

(a) who is compulsorily covered as an "employee" for EPF/EPS/EDLI purposes, and
(b) the maximum wage on which the statutory EPF & EPS diversion is calculated, unless a joint employer-employee request for contribution on higher wages is already on record.

Who Is Affected

• New joinees drawing wages up to INR 25,000/month must now be enrolled as EPF/EPS/EDLI members — a wider net than before, since anyone between INR 15,000 and INR 25,000 was previously an "excluded employee" unless they opted in voluntarily.
• Existing members continue as members regardless of current wages; only the statutory contribution cap shifts.
• Employees already contributing on wages above INR 25,000 under a Para 26(6) of EPF & MP Act joint request are unaffected in substance — their higher-wage contribution simply now sits above a higher statutory floor.
• Employers will see a small increase in the EPS-bound portion of their contribution for every employee whose wages fall between the old and new ceiling, and a corresponding rise in aggregate remittance obligations.

The Contribution Structure, Unchanged in Method

Nothing about how PF is computed has changed — only the wage figure used as the pension cap. The applicable components remain:

The employer's EPS share is always carved out of its 12% contribution — it is not an additional outlay on top of 12%. What changes is simply that a larger slice of Wages (up to INR 25,000 instead of INR 15,000) is now available for that 8.33% pension diversion.

Sample Calculation — Employee Drawing INR 25,000 (Wages)

Total monthly employer outflow (this employee): EPS INR 2,083 + EPF INR 917 + EDLI INR 125 + Admin INR 125 = INR 3,250 (against INR 3,000 employer PF contribution plus statutory charges), over and above the employee's own INR 3,000 deducted from salary.

Before-and-After: The EPS Impact

The most visible shift is in the pension component, since EPS alone is capped at the ceiling:

For any employee earning INR 25,000 or more in Wages, the statutory pension contribution rises by roughly INR 833 per month per employee — a figure payroll teams will want to build into budget projections immediately, since the notification takes effect from the date of Gazette publication, not from a future date.

Compliance Checklist for Employers

1. Re-run coverage checks — identify existing employee & new joinees with wages between INR 15,000 and INR 25,000 who were previously excluded and now require mandatory enrolment.
2. Update payroll masters to reflect the INR 25,000 EPS/EDLI cap with effect from 17 September 2026 — or from a practically convenient date such as 1 September, if a mid-month split is not feasible in your payroll system (see note below on legal vs. practical dates).
3. Recompute ECR filings for the current wage period to ensure the EPS split reflects the new ceiling from the effective date.
4. Review existing Para 26(6) higher-wage arrangements — these remain valid but should be checked against the new statutory floor.
5. Communicate the change to employees whose net take-home may shift marginally due to the revised employer-side split (this does not change employee deduction, only the internal EPF/EPS allocation on the employer side).
6. Retain the notification on file — S.O. 5109(E) formally supersedes S.O. 2702(E), and inspection/audit trails should reference the correct instrument for the correct period.

Legal Effective Date vs. Practical Payroll Implementation

Strictly read, the notification splits September 2026 into two statutory periods for every establishment: contributions for wages up to 16 September must still be computed on the INR 15,000 ceiling, and contributions from 17 September onward must be computed on the INR 25,000 ceiling. That is the legally correct position, and it is the position an auditor or EPFO inspecting officer will apply if the month is ever scrutinised.

In practice, however, this creates a real operational problem. Most payroll and compliance software is built to run one wage ceiling for an entire wage period — it is not designed to bifurcate a single calendar month into a "first 16 days at INR 15,000" segment and a "last 14 days at INR 25,000" segment for EPS/EDLI purposes. Very few systems can do this cleanly without manual workarounds or off-cycle correction entries.

For this reason, many organisations will find it more workable to implement the revised ceiling from 1 September 2026 for the current wage month, rather than attempting a mid-month split, provided this is a considered internal call rather than a strict legal requirement. This has two practical advantages beyond the payroll-system constraint:

• CTC and appointment letter redesign. Where employers want to use this notification as an opportunity/ compulsion to restructure CTC (for instance, revising the PF-qualifying component or issuing addendum/supplementary letters to employment terms), it is far more workable to anchor that change to the start of a wage month — 1 September — than to an arbitrary mid-month date. Employees cannot practically be told that their CTC structure changes from the 17th of a month; a structural change communicated to a workforce needs a clean date, and the first of the month is the natural anchor.
• Consistency of ECR and reconciliation. Running the whole month on one ceiling avoids split-period ECR filings and keeps the reconciliation between payroll, finance and PF remittance straightforward.

The key point for compliance teams to hold onto: this is a matter of practical implementation, not a change in the legal position. The law is clear that the INR 15,000 ceiling applies through 16 September and the INR 25,000 ceiling applies from 17 September. Choosing to apply the new ceiling from 1 September (or any other administratively convenient date within the month) is a business decision driven by system limitations and CTC-restructuring convenience — it should be documented internally as such, and should never be presented as the legally mandated effective date. If audited, the underlying legal position under S.O. 5109(E) remains 17 September 2026.

This note is for general informational purposes and does not constitute legal advice. Employers should assess the notification against their specific payroll structures and, where in doubt, seek a formal compliance opinion.

Click here to view the PPT. 

Click here to read the notification.

EPFO Launches "VISHWAS, 2026": A One-Time Opportunity for Employers to Settle EPF Damages at Reduced Rates

The Employees' Provident Fund Organisation (EPFO), vide Circular No. Compliance/E-1203096/2025 dated 09 July 2026, has operationalized "VISHWAS, 2026", a special dispute resolution scheme notified by the Central Government on 29 June 2026.
The scheme aims to provide employers with a unique opportunity to amicably settle disputes relating to damages levied under Section 14B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (or Section 128 of the Code on Social Security, 2020) by offering substantially reduced rates of damages.

What is VISHWAS, 2026?
VISHWAS, 2026 is a one-time settlement scheme designed to reduce prolonged litigation and facilitate faster recovery of EPF dues while providing financial relief to employers.The scheme became effective from 29 June 2026 and will remain open for six months, making it available until 28 December 2026.

Who Can Avail the Scheme?
The scheme covers almost every stage of proceedings relating to damages under Section 14B, including:

• Cases pending before any judicial or appellate authority, where the damages order is under challenge.
• Final orders where the damages remain unpaid or partially paid, including Revenue Recovery Certificate (RRC) cases.
• Cases where a show cause notice has been issued but the final order has not yet been passed.
• Cases where proceedings are yet to be initiated and no notice has been issued.

This broad applicability makes the scheme beneficial for a large number of establishments facing EPF damage proceedings.

Reduced Rate of Damages
One of the most significant benefits of VISHWAS, 2026 is the drastic reduction in damages for defaults that occurred prior to 14 June 2024.

The revised rates are:

These rates are considerably lower than the damages generally imposed under the existing provisions, thereby offering substantial financial relief.

Important Conditions
Employers intending to opt for the scheme should note the following mandatory conditions:

• Entire interest under Section 7Q (or Section 127 of the Code) must be paid in full before submitting an application under the scheme.
• The employer must furnish an undertaking confirming that no further appeal will be filed after settlement under VISHWAS, 2026.
• Once the dispute is settled, it shall attain finality in accordance with the provisions of the scheme.

Treatment of Part Payments
The Circular also clarifies the treatment of cases where damages have already been paid partially.

• If the amount already paid exceeds the revised damages under VISHWAS, no refund or adjustment will be allowed.
• If the amount already paid is less than the revised damages, the employer will be required to pay only the balance amount.

Appeals and Pre-Deposit
The scheme also provides clarity regarding appeals where mandatory pre-deposits have already been made.
Any amount deposited while filing an appeal will be adjusted against the liability computed under VISHWAS, 2026. If additional payment is required, the employer must deposit the balance amount. Excess deposits, however, are not refundable.

Why Employers Should Consider VISHWAS, 2026
For many establishments, EPF damage proceedings remain pending for years before the EPF Appellate Tribunal or various High Courts. During this period, litigation costs continue to increase and uncertainty remains.
The VISHWAS Scheme provides several advantages:

• Significant reduction in damages.
• Faster closure of long-pending litigation.
• Elimination of future legal costs.
• Opportunity to regularize EPF compliance.
• Greater certainty regarding financial liabilities.

For employers who have pending Section 14B proceedings, the scheme presents an excellent opportunity to resolve disputes at a substantially lower financial burden.

Action Points for Employers
Before applying under the scheme, employers should:

• Review all pending Section 14B proceedings.
• Calculate the revised damages under VISHWAS, 2026.
• Ensure complete payment of Section 7Q interest.
• Assess whether pending litigation can be amicably settled.
• Submit the application well before the expiry of the six-month window.

Conclusion
The introduction of VISHWAS, 2026 marks one of the most employer-friendly initiatives by the EPFO in recent years. By substantially reducing damages and encouraging voluntary settlement, the scheme seeks to balance compliance enforcement with ease of doing business.

Employers with pending EPF damage matters should carefully evaluate the financial implications of the scheme and consider availing this limited-time opportunity before the scheme expires.

Click here to read the notification.