Labor Welfare Fund: Is It Mandatory for Every Employee in Your Organization?

Is the labor welfare fund mandatory for all the organization's employees?

If not, who are the employees not governed by the act?

Understanding Labour Welfare Fund Acts

Labour Welfare Fund Acts are not Central Acts but are State Acts. The coverage will depend upon the state enactment only. Therefore, you may go through the definition of worker/employee under your relevant Labour Welfare Act. Please note that there may be different such Acts for different industries. Therefore, you should see the Act which pertains to your industry in the state.

In most states, LWF Exclusions and Inclusions

LWF excludes managers and includes everyone else. Some states provide a limit of 5% of total strength for managers, and everyone else is considered a worker for LWF.

Please read the relevant rules and make a decision. Mostly, due to the small amount involved, companies just pay for everyone rather than risk a notice under the act.