When Will New EPS Rules Under The Code On Social Security Take Effect?

The Employee Pension Scheme (EPS), 1995, is to change under the Code on Social Security (CoSS), 2020. The government has implemented the new labour codes, effective November 21, 2025, which are likely to be operational from April 1, 2026. When, on March 23, 2026, in the Lok Sabha, parliamentarian Appalanaidu Kalisetti asked whether the government proposes to introduce any new labour law regarding the pension benefits on completion of 10 years of service and the implementation date, the Minister of Labour and Employment, Mansukh Mandaviya, replied in writing.

Implementation Of EPS Under CoSS

Mandaviya said, “Under the provisions of the Employees' Pension Scheme, 1995 (EPS), members of the scheme are already eligible for member pension on completion of 10 years of contributory service.”

On the question of implementation, the minister replied that “Under the Code on Social Security, 2020 (CoSS), the existing Employees' Pension Scheme, 1995 continues to be in force for a maximum period of one year or until it is replaced by a revised Employees' Pension Scheme formulated under the Code.” It means that the existing structure of EPS can continue for one year from the date of implementation, that is, November 21, 2025.

Notably, on November 21, 2025, the government replaced 29 different labour laws with four labour codes. These are: Code on Wages, 2019, Industrial Relations Code, 2020, Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions Code, 2020.

EPS Pension

EPS related changes are covered under the CoSS. According to which, an EPS member is eligible to receive a pension under EPS only after a minimum of 10 years of contributory service and after the age of 58 years. Although there is an early pension clause also, in which one can start receiving a pension after turning 50 years of age. But in that case, the pension amount is reduced by 4 per cent for years short of 58 years.

The scheme also provides a pension to the family in case of a subscriber’s death. The minimum pension remains Rs 1,000 for member pension, and widow, widower, nominee, or dependent parent pension. For a child's pension, the pension amount is Rs 250, and for an orphan's pension, it is Rs 750 per month.

The scheme is mandatory for organised sector workers whose salary is not more than Rs 15,000 and the organisation employs 20 or more workers. Under EPS, employers contribute 8.33 per cent of the employee’s wages (basic plus dearness allowance).

The Pension Fund corpus is made up of this contribution and an additional 1.16 per cent contribution from the central government on wages up to Rs 15,000 per month. The subscribers are guaranteed a minimum of Rs 1,000 pension after retirement. The corpus fund is annually valued, and the pension under EPS is paid from this corpus only.