Employment Linked Incentive (ELI) Scheme

Here is a comprehensive summary of the Employment Linked Incentive (ELI) Scheme, approved by the Union Cabinet on 1st July 2025:

Overview of the ELI Scheme

• Approval: By the Union Cabinet chaired by Prime Minister Narendra Modi.
• Launch Basis: Announced in the Union Budget 2024–25.
• Objective: Promote employment generation, improve employability and expand social security.
• Duration: Benefits for jobs created between 01 August 2025 to 31 July 2027.
• Total Outlay: ₹99,446 Crore under this scheme (as part of ₹2 Lakh Crore umbrella allocation).
• Target: Over 3.5 Crore jobs in 2 years.

Part A – Incentives to First-Time Employees

• Eligibility: EPFO-registered employees with salary up to ₹1 lakh/month.
• Benefit: One month's EPF wage up to ₹15,000, in two installments:
• First installment: After 6 months of continuous service.
• Second installment: After 12 months of service and completion of a financial literacy programme.
• Savings Provision: A portion of the incentive will be deposited in a fixed savings instrument.
• Estimated Beneficiaries: Around 1.92 crore first-time employees.

Part B – Incentives to Employers

• Scope: All sectors, with special emphasis on manufacturing.
• Eligibility Criteria: Establishments must be registered with EPFO.
• Must hire: At least 2 new employees (if <50 workers), At least 5 new employees (if ≥50 workers),
• New employment must be sustained for at least 6 months.**

Employer Incentive Structure: EPF Wage Slab---------------Monthly Incentive per Employee Up to ₹10,000---------------Up to ₹1,000 (proportional) ₹10,001 – ₹20,000-----------₹2,000 ₹20,001 – ₹1,00,000---------₹3,000

Duration: 2 years for all sectors. Extended to 3rd and 4th year for manufacturing. Estimated Job Creation: ~2.60 crore jobs.

Payment Mechanism

• Employees (Part A): Payments via Direct Benefit Transfer (DBT) using Aadhaar Bridge Payment System (ABPS).
• Employers (Part B): Payments to PAN-linked accounts.