he Employment-Linked Incentive (ELI) Scheme) is designed to encourage companies to create more jobs, especially in high-growth sectors.
Under this scheme, employers receive financial incentives and rebates when they hire additional workers, expand their workforce, or regularize contractual labour.
The ELI scheme aligns with India’s broader goals of boosting employment, supporting industries, and strengthening the post-pandemic labour market.
What Is the Employment-Linked Incentive (ELI) Scheme?
The ELI scheme is a government initiative that:
Rewards companies for generating new employment
Encourages formalization of the workforce
Supports industries facing high labour costs
Boosts skill-based hiring
In simple terms, the more jobs a company creates, the higher the incentives it receives.
🔎 Key Objectives of the ELI Scheme
✔ Promote large-scale job creation
Especially in labour-intensive sectors like textiles, manufacturing, logistics, and services.
✔ Encourage formalization
More workers become part of the formal economy through EPFO/ESIC registrations.
✔ Support MSMEs
Incentives help small and medium companies expand faster.
✔ Improve workforce participation
Especially for women, youth, and first-time job seekers.
💰 Benefits Under the ELI Scheme
Employers may receive:
1. Direct financial incentives
Based on the number of new employees added.
2. Reimbursement of EPFO/ESIC contributions
A major cost for companies.
3. Wage-linked incentives
Support for hiring workers within certain salary brackets.
4. Special incentives for hiring women & freshers
Encouraging diversity and first-time employment.
5. Incentives for contract-to-formal conversions
Companies may be rewarded for offering permanent roles.
📝 Eligibility Criteria
The exact eligibility depends on government notifications, but generally includes:
Must be a registered company, LLP, partnership, or MSME
Mandatory registration under EPFO/ESIC
Must show net addition to the workforce
Benefits apply only to employees within certain wage limits
Should comply with labour laws and tax filings
Some sectors may have minimum job-creation thresholds.
🏭 Industries That Benefit the Most
Manufacturing (auto, textiles, electronics)
Retail & e-commerce
Logistics & warehousing
Hospitality & tourism
IT & business services
MSMEs in labour-heavy sectors
These industries gain substantial cost savings when hiring at scale.
📈 Impact of the ELI Scheme
Economists say the ELI scheme:
Helps revive job growth
Strengthens the formal economy
Boosts consumption as more workers earn
Improves India’s global competitiveness
Supports “Make in India” and “Skill India” initiatives
Companies that participate benefit from reduced labour costs and increased productivity.
📌 How Companies Can Apply
Most ELI schemes follow a simple process:
Register on the government’s employment incentive portal
Submit labour records (EPFO/ESIC)
Upload monthly/quarterly workforce reports
Claim incentives based on verified workforce additions
Receive disbursement into linked corporate accounts
❓ FAQs
1. What is the ELI scheme?
It is an Employment-Linked Incentive Scheme that rewards companies for creating new jobs.
2. Who can apply?
Registered companies, MSMEs, and enterprises hiring new workers in eligible sectors.
3. What benefits do employers get?
Financial incentives, EPFO/ESIC reimbursements, and wage-linked subsidies.
4. Does the scheme benefit employees?
Yes — more job openings, formal roles, and social security coverage.
5. Which sectors qualify?
Manufacturing, retail, logistics, IT services, and any labour-intensive industries approved by the government.
Published on : 26th November
Published by : SMITA
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