EPS Scheme 2026 vs EPS 1995: What changes for employees under new pension framework?

The Employees' Pension Scheme (EPS) 2026 has replaced the Employees' Pension Scheme (EPS) 1995, aligning the pension framework with the Code on Social Security, 2020. The new scheme came into effect on 29 June.

While the core objective of providing pension benefits to employees remains unchanged, the new scheme introduces several administrative and structural improvements, including digital compliance and faster claim settlements.

Key differences between EPS 2026 and EPS 1995

Here is the list of differences between the new and old pension schemes.

Applicability and membership

Existing members will automatically continue under the new scheme, with no fresh enrolment required. Coverage will be aligned with establishments governed by the Code on Social Security, 2020.

However, EPS 1995 covers employees in establishments governed by the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, who automatically become members upon joining an eligible establishment.

Employer contribution

Under EPS 2026, the employer's contribution will continue at 8.33% of pensionable salary, but the new scheme also provides for an enhanced contribution of 9.49% for eligible members earning above ₹15,000 per month from 1 September 2014.

Under EPS 1995, the employer's contribution was also 8.33% of pensionable salary. However, the scheme did not include the provision for the enhanced higher pension contribution from the start.

Government contribution

The government will continue to contribute 1.16% of pensionable salary, so there is no change under the new scheme.

Minimum pension

All existing pension benefits, including superannuation, early pension, disability pension and widow pension, will continue under the new scheme. The minimum monthly pension amount remains unchanged at ₹1,000.

Claim settlement timeline

The new framework introduces digital record-keeping, electronic compliance, online filing and claim tracking, with pension claims to be settled within 20 days.

However, EPS 1995 relies largely on physical records and does not prescribe a specific timeline for claim settlement.

Delay in claims

The new EPS 2026 introduces a penalty for delays in processing pension claims. If a claim is not settled within the prescribed timeline without sufficient reason, 12% annual interest will be payable on the delayed amount.

However, EPS 1995 did not contain any explicit provision for penal interest in case of delayed claim settlement.

Several key provisions remain unchanged in EPS 2026

• Automatic enrolment of eligible employees under the pension scheme.
• Availability of existing pension benefits, including superannuation, disability and survivor pensions.
• Continued contributions from both the employers and the Central Government.
• Protection of members' past service, accumulated benefits and pension eligibility during the transition to the new scheme.

Disclaimer: This is for informational purposes only. Please visit the official website for the latest laws and regulations, or consult a qualified expert.