To improve the living conditions of workers in the unorganized sector, the Government of India introduced the Labour Welfare Fund Act in 1953. The act applies to any company that employs 5 or more people. It incorporates various services and benefits offered to the employee by the employer through mutual contributions. The employer needs to deduct the amount of contribution from the employee's salary and submit the same to the LWF Board. The rate of contribution to the LWF, however, differs from state to state.
Currently the LWF Act is implemented only in the states of Andhra Pradesh, Chandigarh, Chhattisgarh, Delhi, Goa, Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Odisha, Punjab, Tamil Nadu, Telangana and West Bengal.
How to enable/disable LWF for a pay group
To enable/disable LWF for a pay group, click on Payroll (1) and then navigate to Settings (2) and to Pay Group (3).
Find the relevant pay group if you have multiple groups set up. Then, click on the configure icon (4).
On the window that opens next, click on Contributions (1). Click on the 3 dots and choose Update LWF Setting (2) from the options that appear.
On the Labour Welfare Settings overlay window, toggle the button to enable Labour Welfare Fund (LWF) and click on Update.
You have now enabled LWF for a pay group. To disable, turn Labour Welfare Fund (LWF) off and click on Update.
Once the LWF (Labor Welfare Fund) has been added to the salary structure, it cannot be disabled.
If you need any more assistance, please refer to the other articles or contact us!
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