The Employees’ Pension Scheme (EPS), 2026, notified under the Code on Social Security, 2020, broadly retains the withdrawal benefit framework that existed under the earlier EPS, 1995. The most important distinction is whether a member completes 10 years of eligible pensionable service.
While members with less than 10 years of eligible service can still claim a withdrawal benefit instead of a monthly pension, they can now do so only after a prescribed waiting period in most cases. Moreover, the amount payable is not based on your accumulated amount in the EPS account but is calculated using a formula.
So, if you’re planning to change jobs, take a career break, or leave the workforce before completing 10 years under EPS, it’s worth understanding exactly how your withdrawal benefit is calculated, when you can claim it, and what options you have.
Scenario 1: Employee works continuously with the same employer for 10 years
If an employee completes 10 years or more of eligible pensionable service without interruption, they cannot withdraw the EPS corpus as a lump sum. Instead, they become eligible for a monthly pension under the Employees’ Pension Scheme upon attaining the prescribed pensionable age (currently 58 years, with provisions for early or deferred pension as per scheme rules).
For example, if an employee joins an organisation at age 25 and remains employed with the same establishment for 10 continuous years while EPS contributions are made regularly, the accumulated service qualifies them for pension benefits rather than a withdrawal benefit. At the time of leaving employment after completing 10 years, they receive a Scheme Certificate, which preserves their pensionable service until they become eligible to draw a pension.
Scenario 2: Employee changes jobs or takes career breaks but accumulates 10 years of service
Changing employers does not by itself affect EPS eligibility. Pensionable service is linked to the member’s Universal Account Number (UAN) and service records, not to a specific employer.
“If an employee works for multiple organisations and the cumulative eligible EPS service reaches 10 years or more, they remain eligible for pension provided the EPS service is properly transferred and linked across employers. Short career breaks do not necessarily break pensionable service, but failure to transfer previous EPS records can create gaps in the service history and complicate claim settlement,” said Balasubramanian A, Senior Vice President, TeamLease Services.
For instance, an employee may work four years with one employer, three years with another, take a one-year career break, and then work another three years. If all eligible EPS service is correctly transferred and consolidated, the total pensionable service becomes 10 years, making the member eligible for pension rather than withdrawal.
The most important point to note here is that under the new provisions of the Employees’ Pension Scheme, 2026, members who leave their jobs before reaching the retirement age can claim the withdrawal benefit only after 36 months from the date their last EPS contribution became due, unless they reach the retirement age earlier.
What is the Table D factor?
Members who leave employment before completing 10 years of eligible pensionable service are generally eligible to apply for a withdrawal benefit, provided they are not immediately taking up another EPS-covered job.
The withdrawal amount is not equal to the total contributions made to EPS. Instead, it is calculated using the formula:
Withdrawal Benefit = Pensionable Salary × Table D Factor
The pensionable salary is currently subject to the statutory wage ceiling applicable under the scheme (Rs 15,000 per month unless higher pension provisions apply).
Table D is a predefined factor specified under the EPS Scheme that corresponds to the completed years of pensionable service. As the length of service increases, the multiplication factor also increases.
For example, assume an employee has:
● Pensionable salary: Rs 15,000
● Eligible service: 7 completed years
● Table D factor for 7 years: 7.13
Withdrawal benefit = Rs 15,000 × 7.13 = Rs 1,06,950
“The exact factor depends on the completed years of eligible service prescribed under Table D of the Scheme. Service is generally counted in completed years, with applicable rounding provisions under the scheme,” said Balasubramanian A.
What if EPS service is not transferred after changing jobs?
This is one of the most common issues faced by employees. If EPS service from the previous employer is not transferred, the service records remain fragmented. As a result:
● cumulative service may appear to be below 10 years;
● withdrawal or pension eligibility may be incorrectly determined;
● additional documentation may be required; and
● claim processing can be delayed.
Employees should always transfer both EPF and EPS service when changing jobs to preserve continuity of pensionable service.
International workers and exempted establishments
International Workers are generally governed by separate provisions under the Employees’ Pension Scheme and applicable Social Security Agreements (SSAs), wherever notified. Their eligibility, contribution requirements and withdrawal conditions may differ depending on nationality, SSA coverage and applicable exemptions.
“Similarly, employees of exempted establishments continue to be covered by EPS unless specifically exempted under the relevant statutory provisions. While their PF may be managed through an exempted trust, EPS benefits remain subject to EPFO rules unless a valid exemption exists,” stated Balasubramanian A.
Common reasons for delays or rejection of EPS claims
The most frequent reasons include:
● Non-transfer of EPS service after changing employers.
● Mismatch in Aadhaar, PAN, bank account or personal details.
● Incomplete KYC or UAN not being fully seeded.
● Incorrect exit date or service details submitted by the employer.
● Applying for withdrawal despite having completed 10 years of eligible service.
● Missing Scheme Certificate where required.
● Discrepancies in employment history or contribution records.
Employees should verify that their UAN service history accurately reflects all previous employment before submitting any EPS withdrawal or pension claim.
Key withdrawal rules
● Less than 6 months of eligible EPS service: Generally, no withdrawal benefit is payable.
● 6 months to less than 10 years of eligible service: Eligible for withdrawal benefit calculated using the Table D factor.
● 10 years or more of eligible service: Lump-sum withdrawal is not permitted. The member becomes eligible for pension benefits and receives a Scheme Certificate upon exit, which preserves pensionable service until pension commencement.
Disclaimer: This article is for informational purposes only and should not be construed as investment advice. Investors should assess their financial goals, risk appetite and consult a qualified financial advisor before making investment decisions.
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