Labour Welfare Fund (LWF)

How LWF works

• Only some states have an LWF statute — the levy does not exist everywhere.
• Both the employee and the employer contribute, with the employer share usually higher.
• Amounts are small and fixed per employee, not a percentage of wages.
• Collection is periodic — commonly half-yearly or annual, depending on the state.

Check the current rate and cycle notified by the state where the employees work; these are revised from time to time.

Payroll handling

• Deduct the employee share in the correct payroll month for the state's cycle.
• Add the employer share and deposit within the due date.
• Keep the challan and the employee-wise statement with payroll records.

Frequently asked questions

Is LWF applicable in every state?

No. Only states that have enacted a Labour Welfare Fund law levy it, and the rates and cycles differ.

Which employees are covered?

Typically employees below a designated managerial or supervisory threshold, as defined by the state law.

Sources & references

• India Code — Central Acts