Robust monitoring mechanism of ELI schemes in works to create new jobs

The government is readying to put in place an inter-ministerial mechanism for robust monitoring of employment-linked incentive schemes which will focus on creation of new jobs across labour intensive sectors, said a senior government official.


"A robust monitoring mechanism will be put in place to ensure there are no leakages in the system and all stakeholders benefit from the scheme well in time," the official told ET . The plan, being drawn up by the labour and employment ministry for the implementation of the three schemes announced in the budget, focuses on identifying employers across industrial clusters for textiles, leather, plastics, footwear, auto components, sports goods, and agri and food processing to nudge them to add more workforce under these schemes.


"The three schemes are being designed in such a manner that they are lucrative for both employers and job seekers, and are easy to implement with no additional regulatory compliances on the employers," the official said, adding that the schemes will be launched by December.

More than 90% of India's nearly 500 million workforce is in the informal sector and the government is keen to facilitate a shift from informal to formal to ensure minimum wages and social security benefits for all.

The budget proposed creation of three employment-linked incentive schemes, to be administered by the Employees' Provident Fund Organisation ( EPFO), as part of Prime Minister's package of five schemes and initiatives to facilitate employment, skilling and other opportunities for 41 million youth over a five-year period with a central outlay of ₹ 2 lakh crore.

Under Scheme A, the government will reimburse one month's wage, up to ₹15,000 in three instalments, as a subsidy to people entering the workforce for the first time.


Scheme B, which focuses on bulk hiring of first-timers in the manufacturing sector, provides for the government to reimburse 24%, 24%, 16% and 8% of the wage, to be equally shared between the employee and the employer, provided the employer hires 50 or 25% of the baseline of its employee strength under the EPFO and retains them for at least 12 months.

Under Scheme C, the government will reimburse the employers' share of the EPFO, up to Rs 3,000 per month for two years. This will be applicable to establishments that hire additional two employees (if their headcount is less than 50) and five employees (if the headcount is more than 50).