Employment-Linked Incentive Scheme (ELIS): In the Union Budget 2024, Finance Minister Nirmala Sitharaman unveiled a range of initiatives aimed at boosting employment and skill development in India. One of the key highlights includes financial aid of up to Rs 15,000 for freshers entering the workforce. Additionally, changes in tax slabs, funds for states like Bihar and Andhra Pradesh, as well as incentives for education, skilling, and gold custom duty were also announced during the presentation.
The FM further introduced three employment-linked incentive schemes to support job seekers, with a special focus on providing a one-month provident fund payment for 30 lakh new entrants to the job market. This move is expected to benefit around 2.1 crore youth voters. Moreover, the budget places a strong emphasis on job creation in the industrial sector, with financial support being allocated to the private sector and experts in various domains to develop climate-resilient seeds. Another significant aspect of the Budget is the establishment of new working women hostels across the country to facilitate more women entering the workforce.
Eligibility: Who qualifies for the Employment-Linked Incentive Scheme 2024?
Especially this Employment-Linked Incentive program is to feel the independence or the financial freedom to new-comers. This is designed to assist new employees in their achievement journey of efficiency and growth by benefiting both the employees and employers. It is applicable to individuals in all official sectors, provided that their monthly income does not surpass Rs. 1 Lakh.
Newcomers in various industries are eligible for the wage subsidy scheme, as long as their monthly income does not surpass Rs. 1 lakh. “First-timers have a learning curve before they become fully productive,” she mentioned, emphasizing the benefits for both employees and employers when hiring freshers.
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This means, Employees must be enrolled with the EPFO, which manages a retirement benefit program for salaried workers in India. Sitharaman mentioned that the wage subsidy will be given to employees in three parts. Following the initial payment, new recruits must complete an online Financial Literacy course to qualify for the second subsidy installment.
Here are the main points
- Over the next 5 years, 20 lakh young people will receive training.
- 1000 ITIs will be improved in Hub and Spoke arrangements with a focus on results.
- The Model Skill Loan scheme will be updated to allow for loans up to Rs 7.5 lakh with government-backed guarantees.
- The government will work with states and industry as part of the Prime Minister’s skilling program package.
How much they will get and how?
Newcomers will be granted a one-month salary grant of up to Rs 15,000 as a component of the government’s job-related incentive scheme. The subsidy will be given in three installments, with the second installment being contingent on completion of a mandatory online Financial Literacy course.
Sitharaman revealed that the government will implement a program to provide paid internship opportunities to students at India’s top 500 companies in the next five years. The initiative aims to benefit 10 million youth. Under this Employment-Linked Incentive plan, interns will receive a monthly stipend of Rs 5,000 and a one-time assistance of Rs 6,000 to kick-start their careers. The companies will be responsible for training the interns and covering 10% of the internship cost using their Corporate Social Responsibility funds.
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What are the consequences of being let go within a year of employment?
In case an employee’s contract is terminated within the first year, the employer will have to repay the subsidy in accordance with the program guidelines. The government intends to support approximately one crore new hires annually through this plan, which is set to last for two years. The total budget for this initiative is Rs 23,000 crore, as stated by Sitharaman.