New mechanism to implement job-linked incentive scheme will be perfect: Centre

The Centre will form a “perfect mechanism” to implement the Employment Linked Incentive (ELI) Scheme approved by the Union Cabinet on Tuesday (July 2, 2025) to support employment generation.

Union Labour Minister Mansukh Mandaviya said the new mechanism would be implemented soon and added that the mechanism would be perfect and would function based on the payroll addition in the Employees’ Provident Fund Organisation (EPFO). He said all employers enrolled under the EPFO would be eligible for the scheme.

Mr. Mandaviya said the Centre would learn from the past and make corrections based on the experience in implementing the Production Linked Incentive Scheme in 2020. Under the new ELI scheme, first-time employees registered with the EPFO would get a one-month EPF wage up to ₹15,000 in two instalments.

“Employees with salaries up to ₹1 lakh will be eligible. The first instalment will be payable after six months of service, and the second instalment will be payable after 12 months of service and on completion of a financial literacy programme by the employee,” the Centre had said on Tuesday (July 2, 2025).

Social security net

Mr. Mandaviya said the Centre’s efforts to widen the social security net had paid off, and the International Labour Organisation had approved that more than 90 crore Indians had one or the other social security at present. He added that the Union Government was trying to sign social security agreements with more countries so that Indians working abroad could also avail themselves of the social security schemes in India. He said the country would include social security in the negotiations with bilateral and multilateral trade treaties.

Deceptive scheme: CPI(M)

Meanwhile, Left parties have questioned the ELI scheme. Demanding that the Centre scrap the scheme, the CPI(M) said it was another attempt by the Union government to benefit the corporates at the cost of workers. “It is yet another example of its cronyism. The ELI scheme is another deceptive scheme of transferring public funds to corporates, veiled in the promise of enhancing job creation, employability and social security to delude the youth.

This scheme promotes fragile and precarious jobs, subsidising investment cost, production costs, labour costs and statutory liabilities of both domestic and foreign employers from the public exchequer,” the statement said.

Pro government trade union Bharatiya Mazdoor Sangh welcomed the ELI Scheme and said it would help in employment generation. The BMS said quality of employment, job security, safe workplaces and access to social security were also equally important.