The Supreme Court on Friday upheld the Employees’ Pension Amendment (Scheme), 2014, and removed the Rs 15,000 cap on maximum pensionable salary, Live Law reported.

Earlier, employees who earned more than Rs 15,000 per month were made to contribute to the pension scheme at the rate of 1.16% of their salary.

On Friday, the court held that this requirement is beyond the powers of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.

This part of the judgement – about the salary threshold – however will come into force six months later as the court wants authorities to adjust to the scheme and generate additional contributions from legitimate sources.

The court passed the judgement after hearing the appeals of Employees’ Provident Fund Organisation and the Centre challenging the judgments of High Courts of Kerala, Rajasthan and Delhi, quashing the 2014 amendments, the Hindustan Times reported.

The organisation and the government have contested the amendments made to Clause 11 of the pension scheme, which raised the salary cap to Rs 15,000. They also contested the provision that employees, who were existing pension system members as on September 1, 2014, could continue to contribute to the pension fund in accordance with their actual salaries. They were given a window of six months to opt for the new pension regime.

On Friday, the Supreme Court read down the condition regarding the cut-off date. It allowed eligible employees who had not opted for enhanced pension coverage prior to the 2014 amendments, to do so with their employers within four months.

The court also held that the amendments to the pension scheme will apply to the employees of “exempted establishments” in the list of the Employees Provident Fund Organisation, The Hindu reported.