Many salaried employees contribute to the Employees’ Provident Fund (EPF) every month, but many are unaware that they may also qualify for a lifelong pension under the Employees’ Pension Scheme (EPS). If you have worked in the organised private sector and completed at least 10 years of service, you could be eligible to receive a monthly pension after retirement. 

The Employees’ Pension Scheme (EPS), launched in 1995 and administered by the Employees’ Provident Fund Organisation (EPFO), is designed to provide financial security to workers after retirement. The scheme covers employees who are enrolled in EPF, with a portion of the employer’s contribution directed towards the pension fund.

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Who Is Eligible?

To qualify for a monthly pension under EPS, an employee must complete at least 10 years of eligible service and reach the age of 58 years. Once these conditions are met, the employee can apply for pension benefits through EPFO. Employees also have the option to start receiving a reduced pension at the age of 50.

How Is EPS Pension Calculated?

EPS Pension Formula: Monthly Pension = (Pensionable Salary × Pensionable Service) ÷ 70

Pensionable salary generally refers to the average monthly salary drawn during the specified period before retirement, while pensionable service refers to the total years of eligible service under the scheme.

Average salary of the last 60 months (capped at ₹15,000); pensionable service: total duration of service for which contributions were made to the EPS. For example, if an employee's pensionable salary is ₹15,000 and they serve for 10 years, their monthly pension would be: Monthly Pension = (15,000 × 10) / 70 = ₹2,143.

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More Than Just Retirement Benefits

The EPS scheme is not limited to retirement pensions. It also provides benefits to family members in case of the subscriber’s death. Eligible dependents, including spouses and children, may receive family pension benefits. The scheme also offers disability pension provisions for members who become permanently disabled during service. 

What Is the Minimum Pension?

At present, the minimum monthly pension under EPS remains ₹1,000. While discussions on increasing the minimum pension are ongoing, EPFO has clarified that no official decision has yet been taken to raise it to ₹7,500, despite claims circulating on social media.

Published on: Jun 23, 2026 12:09 PM IST