Labour welfare fund is a statutory contribution managed by individual state authorities. The state labour welfare board determines the amount and frequency of the contribution. The contribution and periodicity of remittance differs with every state. In some states the periodicity is annual (Andhra Pradesh, Haryana, Karnataka, Tamil Nadu etc) and in some states it is to be contributed during the month of June & December (Gujarat, Madhya Pradesh, Maharashtra etc).

What is Labour Welfare Fund?

Labour welfare is an aid in the form of money or necessities for those in need. It provides facilities to labourers in order to improve their working conditions, provide social security, and raise their standard of living.

To justify the above statement, various state legislatures have enacted an Act exclusively focusing on welfare of the workers, known as the Labour Welfare Fund Act. The Labour Welfare Fund Act incorporates various services, benefits and facilities offered to the employee by the employer. Such facilities are offered by the means of contribution from the employer and the employee. However, the rate of contribution may differ from one state to another.

Frequency of Contribution of Welfare Fund

The contribution in the Labour Welfare Fund may be made annually, half yearly or monthly. The frequency may differ depending upon the state specific Act. Further, if the frequency is half yearly the period of deduction shall be divided into two consecutive periods as per the date mentioned in the state specific Act. The employer needs to make the deduction from the salary of the employee and submit the same to the Labour Welfare Fund board in the prescribed form before the due date.

Labour Welfare Fund applicable states

In order to provide social security to workers, the government has introduced the Labour Welfare Fund Act. This act has been implemented only in 15 states out of 34 states including union territories.

The below table depicts the states in which the Act has been implemented and not implemented:

State Contribution Frequency Employee Contribution Employer Contribution Return Form
Andhra Pradesh Annual 30 70 Form F
Chandigarh Monthly 5 20 Nil
Chhattisgarh Half Yearly 15 45 Nil
Delhi Half Yearly 0.75 2.25 Form A
Goa Annual 120 360 Form B
Gujarat Half Yearly 6 12 Form A1
Haryana Monthly 10 20 Nil
Karnataka Annual 20 40 Form D
Kerala (Shops & Commerical Establishments) Monthly 20 20 Form A
Madhya Pradesh Half Yearly 10 30 Nil
Maharashtra Half Yearly 6/12 18/36 Form A1 cum Return
Odisha Half Yearly 20 40 Form F
Punjab Monthly 20 25 Nil
Tamil Nadu Annual 10 20 Form A
Telengana Not Applicable 20 40 Not Applicable
West Bengal Half Yearly 3 6 Form D
Kerala (firms under Factory Act) Half Yearly 4 8 Form A