Complete Guide To Telangana Labour Welfare Fund (LWF), Its Applicability, Registration, Due Dates, Contribution Rate & Penal Interest
Overview : This blog is about the Telangana Labour Welfare Fund, which provides detailed information about the applicability of The Telangana Labour Welfare Act on the establishment and its exception, contribution periods, contribution rates in respect of employees and employers, due date for LWF payment/return filing under the Telangana Labour Welfare Fund, The blog also deals with the late payment interest and penalty for non-compliance.
Introduction of Telangana LWF
The Telangana Labour Welfare Board was established under the Telangana Labour Welfare Fund Act, 1987, to improve the welfare of employees and their dependents in the organized sector. The Board formulates and implements welfare schemes through the Labour Department. These schemes cover workers in various establishments, including Factories, Shops, Motor Transport Undertakings, Societies, and Trusts. The Board is funded by contributions of ₹7 per worker per year (₹2 from employees, ₹5 from employers), unclaimed wages, rent income, government grants and advances. While the Welfare Commissioner is the Chief Executive Officer of the Board, claims for unpaid accumulations are adjudicated by the authority appointed under the Payment of Wages Act. This board is composed of representatives from employers, employees, and independent members. Late payment of contributions attracts penalties
Key Highlights of the Telangana Labour Welfare Fund (LWF)
| S.No | Particulars | Key Information |
|---|---|---|
| 1. | Governing Act | The Telangana Labour Welfare Fund Act 1987. |
| 2. | Effective Date | 14 August 1987 |
| 3. | Applicability | Establishments employing twenty or more employees (Employees of all branches, all over India shall be counted for this purpose) |
| 4. | Registration | No separate registration is required when already registered under the Telangana Shops & Establishment Act. |
| 5. | Contribution Rate | Section 10(1)
|
| 6. | Contribution Period | Yearly |
| 7. | Due Date | Yearly (1st Jan to 31st Dec): 31 January |
Applicability of Telangana Welfare Fund Act, 1987
This act may be called as Telangana Labour Welfare Fund Act, 1987 (Hereinafter referred to as The Act). This act covers or extends to the whole state of Telangana. This act applies to all establishments or employers where Twenty or more employees are working or employed.
Meaning of Establishment
Under Section 4 of The Act Establishment means a factory as defined in Section 2(m) of the Factories Act, 1948, or a motor transport undertaking as defined in the Motor Transport Workers Act, 1961, or any other establishment as defined in Section 2 (10) of the Andhra Pradesh Shops And Establishments Act, 1966, and includes a society registered under any law in force in the State relating to registration of societies and charitable or other trusts and which employs or on any working day during the preceding twelve months employed twenty or more persons. But does not include an establishment, not being a factory, belonging to or under the control of the Central or any State Government.
Meaning of Employee
Under Section 2(i) of The Act Employee means Any person who is employed for hire or reward to do any work, skilled or unskilled, manual, supervisory, clerical, or technical, in an establishment for a period of thirty days during the period of twelve months, whether the terms of employment be express or implied. But does not include any person:
- Who is employed mainly in a managerial capacity.
- Who, being employed in a supervisory capacity, draws wages exceeding Rs. 1,600 (Rupees sixteen hundred) per month or exercises either by the nature of the duties attached to the office or because of the powers vested in him, functions mainly of a managerial nature
Meaning of Employer
Under Section 3, Employer means any person who employs either directly or through another person, either on behalf of himself or any other person, in an establishment and includes; In a factory, any person named under Section 7(1) (f) of the Factories Act, 1948 as the manager, In any establishment, any person is responsible to the owner for the supervision and control of the employees or the payment of wages.
Registration Under Telangana LWF
Once workers reach twenty or more on any working day during the preceding twelve months, the employer must pay contributions to the Telangana Labour Welfare Board. They must go to the Official Site of the Telangana Labour Department. Use the User ID and Password created during shop, establishment registration, and log-in. Go to the Payment Bar and Enter the details regarding Employer and Establishment Details, Total amount of Contribution, Year of Contribution, Employees Details, etc. And pay the contribution amount.
However, If the establishment has been registered under the Telangana Shop and Establishment Act, they do not need to register under the Telangana Labour Welfare Board. They can pay the LWF Contribution with the details of the registration obtained under the Shops & Establishment Act.
Contribution made by the employees and employer
Every establishment or employer where Twenty or more employees are employed and covered under this act needs to contribute to the Telangana Labour Welfare Fund under the act. Every establishment or employer needs to pay a contribution towards LWF once a year on the 31st of December, in respect of every employee and an employer for each such employee.
| Payer | Rate of contribution as of 31st December |
|---|---|
| Employee | Rs 2/- |
| Employer for each such employee | Rs 5/- |
Last Date of Payment of Contribution
Every employer has to pay to the Board both the employer’s contribution and the employee’s contribution by the provisions by the 31st of January succeeding year.
Interest on nonpayment or late payment of LWF
If the employer does not pay the whole or any part of the contribution amount or any other amount that he had to pay by the act. The Welfare commissioner may serve a notice regarding payment of the due by the employer. Even if the employer continues not paying the due amounts, then the employer shall be charged by the simple interest according to the amount payable by him as on the last date prescribed in the notice. The period and rate of interest are mentioned below:
| Period | Rate of Interest |
|---|---|
| For the First 3 Months | 1% of the total amount (For each passing month) payable by the employer as of the last date prescribed in the notice sent by the Commissioner. |
| After 3 Months passed mentioned above | 1.5 % of the total amount (For each passing month) payable by the employer when he continues to default on the payment of that amount. |
Conclusion
The Telangana Labour Welfare Board was formed to improve the conditions of employees working in the organized sector and their legal dependents. An attempt is made to present the legal position concerning the Telangana Labour Welfare Fund Act 1987 in simple and easy-to-understand language. The blog on Telangana LWF is about the employer's responsibility to follow all the rules and regulations regarding the contribution payments and other dues mentioned in the act in the interest of their employees to the fund.