Employment Linked Incentive Scheme: The ELI Scheme was announced in the Union Budget 2024-25 to facilitate employment, skilling and other opportunities. The scheme is launched to benefit both the employee and the employer. The benefit is for the first-time employee. They will get one month’s wage (up to ₹15,000) and the employer will be given incentives for a period of two years. The ELI Scheme is more focused on the manufacturing sector with the employers benefits being additional two years. The incentives will be provided for the jobs created between 01 August 2025 and 31 July, 2027.
Employment Linked Incentive Scheme Overview
The Employment Linked Incentive (ELI) Scheme is mainly focused on generation of employment in the manufacturing sector while including other sectors too. The scheme was announced in the Union Budget 2024-25. The scheme consists of two parts. Part A is related to the first-time employees and Part B is related to the employers. This scheme will come into effect from August 01, 2025.
What are the Key Components of the Employment Linked Incentive Scheme
The ELI Scheme has two components as Part A and Part B which are related to the first-time employees and the employers.
Key Components
-
Part A: Incentives for First-time Employees
-
First-time employees registered under Employees’ Provident Fund Organization (EPFO). The Part A will benefit around 1.92 crore first time employees.
-
They will get one month EPF up to ₹15,000 in two installments (after 6 and 12 months of service).
-
Those employees whose salaries are up to ₹1 lakh are eligible.
-
This scheme is also focused on increasing the saving habits of the employees by keeping a portion of the incentive that will be kept in a fixed deposit and can be withdrawn by the employee at a later date.
-
Part B: Incentives for the Employers
-
The employers will get an incentive of ₹3,000 per month for two years for generating additional employment.
-
The incentive will be provided for employees whose salaries are ≤ ₹1 lakh.
-
For the manufacturing sectors, the incentive will be stretched for 3rd and 4th year as well.
-
The firms registered with EPFO must hire 2 additional employees (for firms with less than 50 employees) and 5 additional employees (for firms with more than 50 employees) with minimum sustainability of 6 months.
Incentive Payment Mechanism of ELI Scheme
The payments will be made through Direct Benefit Transfer under Part A of the scheme to the First Time employees. Payments to the Employers under Part B will be made directly into their PAN-linked Accounts.
Comments
All Comments (0)
Join the conversation