The ambiguity arose because while some provisions in the notified scheme appeared to apply the statutory wage ceiling of ₹15,000 to international workers, others continued to refer to contributions on "total wages", creating uncertainty over whether the long-standing contribution framework had been altered.
Responding to emailed queries sent by Business Standard, the EPFO said there was no proposal to change the existing framework and attributed the confusion to "typographical and drafting inconsistencies" in the notified scheme.
"Some observations regarding the scheme have arisen due to certain typographical and drafting inconsistencies, which are already under examination and appropriate corrigenda are under consideration. These are intended only to remove any unintended ambiguity and do not reflect any change in policy. Accordingly, there is no proposal to alter the existing contribution framework or other substantive provisions applicable to international workers under the draft EPF Scheme, 2026," the EPFO said in its response.
The EPFO said the provisions relating to international workers had been carried forward "substantially in the same manner" from the Employees' Provident Fund Scheme, 1952, and would continue to operate in accordance with India's bilateral social security agreements (SSAs).
The ambiguity was also flagged in post-notification analyses by professional services firms, including EY and Grant Thornton Bharat, which noted that the wording of the new scheme had raised questions over whether the statutory wage ceiling would apply to international workers.
The issue is particularly significant for multinational companies employing expatriates in India, as applying the wage ceiling would have substantially reduced mandatory provident fund contributions for higher-paid international workers, with implications for payroll costs and compensation structures. The EPFO's clarification indicates that no such change is intended.
International workers include foreign nationals employed in India who are covered under the EPF framework, as well as Indian employees posted to countries with which India has signed bilateral social security agreements (SSAs), such as the UK, Germany, France, Belgium and Japan. An Indian employee does not become an international worker merely by taking up a job abroad. The category applies only where the employee is covered under a bilateral SSA, which governs social security obligations between the two countries.
The EPFO issues Certificates of Coverage (CoCs) to Indian employees posted to countries with which India has social security agreements, allowing them to remain covered under India's social security system instead of contributing to the host country's social security scheme. The number of CoCs issued rose to 30,713 in 2023-24 from 14,798 in the pandemic-hit 2020-21, according to the EPFO's latest annual report for 2023-24.
The EPFO no longer publishes the number of international workers covered under the provident fund system in its annual reports. The last publicly available figure showed 28,205 international workers enrolled under the EPF framework as of March 31, 2018.
Debjani Aich, partner at CMS INDUSLAW, said the language in the notified scheme had created uncertainty because it appeared to cap provident fund contributions for international workers at the statutory wage ceiling, departing from the earlier framework.
"I would like clarifications on the international worker contribution matter, as with global workforce mobility on the rise, especially with free trade agreements, this is an impact for MNCs to consider ahead of modifying workforce and pay structures," Aich added.
Pooja Ramchandani, partner at Shardul Amarchand Mangaldas & Co., said the statutory wage ceiling under the EPF Scheme, 2026 served separate purposes for determining eligibility and computing provident fund contributions. She said the wage ceiling applied only to Indian workers for determining eligibility, while international workers were linked to participation in a bilateral social security agreement.
 "EPFO, Employees' Provident Fund Organisation, Provident Fund")