Retired employees lost EPS-95 pension case
On October 14, 2026, retired employees from the Employees’ Pension Scheme (EPS) 1995 lost their case at the Karnataka High Court. They challenged amendments to the scheme, arguing that the changes reduced their monthly pension. The court upheld the amendments, finding no grounds to strike them down.
The primary contention of the retired employees was that the 2007 amendments took away benefits they were entitled to under the EPS 1995 scheme. However, the Employees' Provident Fund Organisation (EPFO) argued that the 2007 notifications were clarificatory in nature, fixing anomalies in the existing scheme and not taking away any vested rights.
The Court examined the pension entitlements before and after the 2007 amendment. The analysis showed that the pension was reduced by Rs 62 in the case of a retired employee entitled to Rs 1100 per month who desired to draw a reduced pension at the age of 52. The Court found that the amendment was in line with the Central Government's power to amend the EPS scheme, even retroactively.
Vaibhav Bhardwaj, Partner at Khaitan & Co, explained that the case came down to the government's power to rewrite the pension scheme. The EPF Act allows the Central Government to amend the EPS, including with retrospective effect. Bhardwaj argued that the 2007 amendment replaced the old provision altogether, treating the new wording as if it had been there since 1995. Consequently, retirees could not claim a locked-in right under the old pre-amended law provision just because they retired before the 2007 amendment date.
The Court also accepted that the amendment largely clarified the scheme's intention. It upheld the interpretation that the Rs 800 minimum pension applied to the total pension, not just the past-service pension. The Court followed the Supreme Court's 2022 view that judges should be cautious in interfering with how a pension scheme is designed. Bhardwaj noted that simply showing some pensioners received less under the amended scheme was not enough to overturn the changes.
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