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EPFO Pension: The Ministry of Labour and Employment notified the Employees' Pension Scheme (EPS) 2026 on June 29. With this, the new EPS-2026 has replaced the EPS-1995 and the 1971 Family Pension Scheme. Consequently, around 6 crore EPFO ​​members are wondering: Have the pension rules changed? Will the pension amount increase? Do retirement plans need adjustment?

The reassuring news is that the formula for calculating the monthly pension and the rule requiring a minimum of 10 years of service remain unchanged.

**Completion of 10 Years of Service is Mandatory**

To receive a monthly pension under the EPS, you must complete at least 10 years of 'pensionable service.' You will begin receiving the monthly pension upon attaining the age of 58. Alternatively, you may opt for an early pension—albeit at a reduced rate—after turning 50.

However, if you do not complete 10 years of service, you will not be eligible for a monthly pension. In such a scenario, you have two options: either withdraw the EPS funds or obtain a 'Scheme Certificate' to carry forward and merge your service period with future employment.

**How ​​is the Pension Calculated?**

EPFO determines the pension amount based on a specific formula:

Monthly Pension = (Pensionable Salary × Pensionable Service) ÷ 70

Here, 'pensionable salary' refers to the average of your basic salary and Dearness Allowance (DA) over the final 60 months of service. However, for most employees, this is capped at ₹15,000.

**What Pension Will You Receive on a Salary of ₹15,000?**

If your pensionable salary is ₹15,000, completing 10 years of service would entitle you to a monthly pension of approximately ₹2,143. While this amount may not seem substantial, it represents a guaranteed pension payable for life.

Meanwhile, upon completing 20 years of service, this amount would increase to approximately ₹4,286. Meanwhile, upon completing the maximum pensionable service of 35 years, you could receive a pension of ₹7,500 per month. The longer your service tenure, the higher the pension you will receive.

**Minimum pension remains ₹1,000**

Currently, the minimum pension under the EPS remains ₹1,000 per month. This means that if your calculated pension after 10 years of service amounts to less than ₹1,000, the government will make up the difference. For instance, if your calculated pension is ₹500, the government will provide the remaining ₹500.

There have been long-standing demands to raise the minimum pension to between ₹5,000 and ₹7,500. Pensioners argue that with the significant rise in the cost of living, a minimum pension of ₹1,000 is wholly inadequate. However, the government has not yet taken an official decision on this matter.

**Avoid this mistake when changing jobs**

If you are changing jobs, it is essential to transfer your EPF and EPS accounts to your new employer. Withdrawing the EPS amount before completing 10 years of service can break the continuity of your "pensionable service," which could impact the monthly pension you receive in the future.

Transferring your EPF account via your UAN to the new job ensures continuity of service. This makes it easier to meet the 10-year eligibility requirement, thereby enabling you to avail the benefit of a monthly pension after retirement.

Disclaimer: This content has been sourced and edited from Money Control. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.