Employee Linked Incentive (ELI) Scheme – Benefits, Eligibility & Impact

Employee Linked Incentive (ELI) Scheme – Benefits, Eligibility & Impact

by with No Comment Labour ActNews & Updates
Introduction:

The Employee Linked Incentive (ELI) Scheme is a major initiative launched by the Union Government in the Union Budget 2024-25, to address the country’s growing unemployment challenges. India is currently facing high levels of unemployment among the youth, underemployment, and a mismatch between the skills and industry demand. The ELI scheme is proposed to stimulate the private sector to participate in job creation and workforce development. The scheme seeks to incentivize and motivate employers to hire more youth, especially freshers while encouraging skill development and enhancing job retention.

The ELI Scheme is a package of 5 schemes to create more job opportunities and improve the livelihood of people across the country. The scheme envisages providing employment, skilling, and other opportunities for 4.1 crore youth over five years with a total central outlay of ₹ 2 lakh crore. Out of this, 1.07 crore is allocated to implement Plan A, B, and C, ₹63,000 crore for Plan D to provide an Internship programme for skilling 1 crore youth in 5 years, and ₹30,000 crore for Plan E for upgrading of Industrial Training Institutes (ITI’s) across the country.

The package highlights the government’s strong commitment to tackling unemployment and boosting economic recovery, especially after the challenges posed by COVID – 19 pandemic.

The Objectives:

The ELI Scheme hopes to address the country’s growing unemployment by incentivizing the private sector for job creation, skill development, and retention.

The main objectives are:

  1. Promote the employment of youth: The scheme primarily aims to reduce unemployment among the youth by encouraging organizations to recruit youngsters especially those joining the workforce for the first time.
  2. Encourage job retention: The ELI scheme has features to encourage job retention by offering incentives to employers who maintain higher workforce levels over a period of time, especially those who recruit beyond a specified threshold.
  3. Encourage Skill Development: Skilling has been the Government’s objective, and this initiative aligns with this aim. This is achieved by encouraging skill development among the youth, by motivating employers to invest in training and skill development of their workforce.
  4. Enhance Formal Employment: Historically, industries have depended on informal labour. This scheme aims to formalize employment by incentivizing employers who transition workers into the formal economy by providing social security such as Provident Fund (PF) coverage.
  5. Boost employment in the Manufacturing Sector: The Scheme has features that target the Manufacturing Industry to boost job opportunities by promoting the recruitment of first-time-employees.
  6. Reduce Economic Disparity: the Scheme aims at reducing economic disparity and improve social mobility by prioritizing on job creation and skill enhancement for youth especially those from the underprivileged backgrounds.
  7. Assist Employers in recruitment: The programme aims to lower the expenses of employers and motivate them to increase their employment levels by providing financial assistance such as reimbursing employers for their PF contributions towards new hires.
The Schemes

The Employment Linked Incentive Schemes encompass 5 programs aimed at employment generation, retention, workforce formalization, skill development, and enhancing full compliance with all statutory rules and regulations.

The total outlay for the entire scheme is ₹2 lakh crores for 5 years. Out of this, ₹1.07 lakh crore is allocated for Scheme A, B, and C to generate employment for 3.1 crore new employees, ₹ 63,000 crore is allocated for Internship Programme for skilling 1 crore youth in 5 years, and ₹30,000 crore for upgrading of Industrial Training Institutes (ITI’s)

Scheme A: First-time Employees Support Scheme

This scheme is designed for youth who are entering the formal workforce for the very first time. All newly joined employees in the formal sector will receive one month’s salary up to ₹15,000 to be disbursed through direct transfer in 3 installments. The first-time employment scheme is expected to benefit around 210 lakh youth over 2 years. The Central outlay for the scheme is ₹23,000 crores. Enrolment is open for 2 years and the expenditure coverage extends to 3 years. The subsidy paid under this scheme supports employees and boosts the hiring of first-time employees by employers.

The salient features of the scheme are briefed below:

  1. Applicable to all newly joined employees in the formal sector.
  2. Applicable to newly joined employees enrolled in EPFO and drawing a wage or salary of less than ₹ 1 lakh per month.
  3. Eligible employees will receive a subsidy of up to ₹ 15,000 directly in 3 installments.
  4. The eligible employee has to mandatorily undergo a financial literacy course to receive the second installment.
  5. The employer has to refund the subsidy to the employee if the employment ends within 12 months of recruitment.
  6. The scheme will be applicable for 2 years after enrolment with EPFO.
Scheme B: Incentives for Job creation in the Manufacturing Sector

This scheme is designed to enhance employment in the manufacturing sector. The scheme rewards both employers and first-time employees who contribute towards EPFO. The incentive will be paid at a specified scale to both the employee and employer directly based on the EPFO contributions made in the first 4 years of employment. The incentives will be paid partly to both the employees and employers for 4 years as detailed below:

Year Percentage
First year 24% shared equally between employee and employer
Second year 24% shared equally between employee and employer
Third year 16% shared equally between employee and employer
Fourth year 8% shared equally between employee and employer

This scheme is aimed at incentivizing employment in the manufacturing sector and is expected to benefit 30 lakh youth and their employers. ₹52,000 crore has been earmarked for this scheme. The program has a 2 year enrolment plan with the expenditure phase spanning 6 years. This will allow sustained support that will boost long term employment in the manufacturing sector.

The salient features of the scheme are briefed below:

  1. The scheme applies to first-time employees in the manufacturing sector.
  2. All corporate and non-corporate employers who have a 3-year track record with EPFO contributions will be eligible.
  3. Employees who contribute towards EPFO and who earn a wage or salary of up to ₹1 lakh per month will be eligible for this scheme.
  4. The employees must be directly employed by the organization that pays the salary.
  5. Where the salary of the employees exceeds ₹25,000 per month, the incentive will be calculated at the capped amount of ₹25,000 per month.
  6. If the employment ends within 12 months of recruitment, then the employer will refund the subsidy to the employee.
  7. The scheme requires the employer with a 3-year EPFO contribution to hire either 50 new employees or 25% of their workforce, whichever is lower to qualify for the incentive.
  8. Employers should maintain the enhanced level of employment throughout, failing which they will not receive the subsidy.
  9. The incentive will be paid over 4 years, shared equally between the employee and the employer as per the table given above.
  10. The scheme will apply to an employee for 2 years after enrolment with EPFO.
Scheme C: Support to Employers for EPFO contributions

The third scheme under the Employment Linked Incentive Scheme is to support employers who contribute towards EPFO. This is a fully employer focussed scheme that covers every additional employment within a salary of ₹1 lakh per month within all sectors.

The salient features of the scheme are briefed below:

  1. The scheme incentivizes employers who increase their workforce above the baseline (the previous year’s number of EPFO employees) by at least 2 employees for companies with less than 50 employees or 5 employees for companies with 50 or more employees and maintain this level.
  2. The scheme applies to employees earning up to ₹1 lakh per month.
  3. New employees need not be newly enrolled with EPFO.
  4. The EPFO will reimburse contributions paid by the applicable employer for the additional employees hired in the previous year up to ₹3,000 per month for 2 years.
  5. When the employer creates more than 1000 jobs, reimbursement will be done for every quarter.
  6. The subsidy will continue for the 3rd and 4th years on the same scale as employers benefit provided under job creation for manufacturing sector.
  7. The subsidy provided under this scheme is in addition to the subsidy provided under the first-time employment scheme.
  8. The scheme is applicable for 2 years after joining employment.

The Central outlay for this scheme is ₹32,000 crores and is expected to benefit 50 lakh youth. The program has 2 year enrolment duration and the expenditure duration is for 6 years.

Scheme D: Internship Scheme with Top Companies

The Internship Programme envisages skilling 1 crore youth aged between 21 to 24 years over 5 years in top 500 companies. The total outlay for the scheme is ₹63,000 crores.

The salient features of the scheme are briefed below:

  1. The duration of the Internship is 12 months with a monthly allowance of ₹5,000 and a one-time assistance of ₹6,000.
  2. Unemployed youth in the age group of 21-24 are eligible.
  3. The government will contribute significantly to the allowance costs, while the administrative and training expenses will be borne by the Company through CSR funding.
  4. Priority will be given to candidates with lower employability metrics.
  5. Actual skill training is mandatory with a focus on hands-on-work over classroom learning.
Scheme E: Skilling programme and upgradation of ITI’s

This is a scheme to skill youth with state and industry collaboration. This centrally sponsored scheme has a total outlay of ₹60,000 crores, where the Central Government spends ₹30,000 crores, the State Government spends ₹20,000 crores and the Industry ₹10,000 crores (this includes CSR funding).

The salient features of the scheme are briefed below:

  1. The objective is to skill 20 lakh youth so that industry standards can be met and employability enhanced.
  2. The programme envisages the upgradation and revamping of 1000 Industrial Training Institutes (ITIs), in a “hub and spoke” model with 200 hubs and 800 spokes nationwide with the cooperation of the industry.
  3. A complete Re-design and review of existing courses.
  4. Introduction of New courses with 1 and 2 year courses offered in all the 1000 ITI’s
  5. Offering specialized short-term courses in Hub ITI’s.
Key Takeaways of the Employment Linked Incentive Schemes

The ELI Scheme offers several key benefits and they are:

  1. Promoting Job Creation: the ELI scheme acts as stimulus to companies to hire more employees by offering incentives tied to EPFO Contributions. This will stimulate industrial growth and promote employment in various sectors.
  2. Supports fresh graduates and new entrants: The first-timers scheme helps to integrate fresh graduates and new entrants into the formal workplace. This scheme reduces the financial strain and ensures a smooth entry into the job market by providing a stable income at the start of a career.
  3. Strengthens financial security for employees: By incentivizing formal employment through EPFO contributions, the scheme ensures access to retirement benefits thus enhancing the long-term financial security of employees.
  4. Encourages workforce expansion for employe₹ The job creation in the Manufacturing sector scheme encourages employers to expand their workforce by linking incentives to EPFO contributions. This reduces the financial barrier for employers to hire more workers, helping the companies to meet the increasing demand and grow in the process.
  5. Reduces the financial burden of the employe₹ The Support to Employers scheme reimburses a portion of the EPFO contributions for newly hired employees. This specifically helps Small and Medium-sized Enterprises (SMEs) to reduce the cost of hiring, making it more viable for SMEs to expand their workforce.
  6. Boosts Economic growth: By creating more job opportunities and incentivizing businesses to hire, the ELI scheme ensures that the growth driven by other manufacturing incentives such as the PLI scheme, translates into actual long-term employment gains.
  7. Encourages the formalization of the workforce: Incentivizing the formal sector employment, this helps to transition workers from the informal sector to the formal sector, providing greater stability and access to social security benefits.
Conclusion

The Employment Linked Incentive (ELI) Scheme is a strategic approach by the Central Government to address the unemployment problem in the country and to drive economic growth. The incentives targeted at both employers and employees aim to create a more inclusive and dynamic job market. The initiatives under the ELI scheme will not only support workforce expansion and formalization but will also significantly enhance the financial relief to employers, especially SMEs, thus making it easier for them to grow and hire.

GetifyHR, with its vast experience in Payroll processing and HR Management, assures all stakeholders of our continued support in helping them to make use of these schemes to foster growth and job creation, and to ensure a thriving and sustainable business in the long term.

EPFO’s new flexible savings scheme

EPFO set for a Major Upgrade: Flexible Savings and Instant PF withdrawals through ATMs

by with No Comment Labour ActNews & Updates

The Employees’ Provident Fund Organization (EPFO) is poised to introduce ground-breaking upgrades through EPFO 3.0 slated for roll-out in June 2025. The upgrade will allow Provident Fund (PF) users to withdraw their savings using ATM cards thus bringing EPFO services closer to the banking experience. Other features include a revamped Mobile App, flexible pension options with enhanced digital security, faster claims, and better service. EPFO 3.0 represents a major leap that introduces a host of new features and reforms aimed at simplifying processes, reducing paperwork, and empowering employees to manage their PF accounts independently.

What is EPFO 3.0?

EPFO 3.0 is the upcoming phase of digital transformation introduced by the EPFO to make PF management more user-friendly, transparent, and efficient. Once these reforms are rolled out, employees can self-correct personal details such as name, date of birth, and marital status directly through the EPFO Portal. This will significantly reduce administrative time delays.

In addition to this, Provident Fund account transfers will no longer require verification by the employer due to the introduction of Aadhaar–based OTP authentication. Another rather interesting upgrade is the introduction of an EPFO ATM card that enables instant PF withdrawal through ATMs. The upcoming EPFO 3.0 Mobile app provides on-the-go account management, faster claim processing, and seamless access to retirement savings. Once rolled out, the system is expected to benefit millions of salaried employees who contribute to the EPF scheme.

Salient features of EPFO 3.0

EPFO 3.0 introduces a range of innovative features to streamline processes, enhance user convenience, and reduce administrative delays, thus empowering employees to manage their PF accounts.  This Employee Provident Fund Update is poised to change the way the funds are used and managed by the members.

  • User-Friendly Interface: The proposed revamp of the EPFO website will offer a robust, interactive, and user-friendly interface for seamless navigation and easier management of Accounts.

 

  • Self-correction of Personal Data: EPF members can now independently correct discrepancies or make changes in personal information like name, date of birth, gender, nationality, etc., directly through the EPFO Portal. This eliminates the need for employer approval or supporting documents in most cases.

 

  • ATM cards for instant EPF withdrawals: EPFO members will issue ATM Cards to members that function as debit cards. Members can directly withdraw their EPF savings from ATMs, offering Instant P.F withdrawal process in India, a first of its kind in the country. This will provide instant access to funds thus reducing the hassle of waiting for approval.

 

  • EPFO Mobile App: A new Mobile App is to be launched that will streamline the management of EPF Accounts. Through this Mobile App, members can check account balances, file claims, and access a wide variety of services. This is a one-stop solution for all EPFO-related tasks.

 

  • Reduction in PF Transfer time: Members can now file their PF transfer claims directly with EPFO using Aadhaar-based OTPs without employer intervention. This will significantly reduce the delays in transferring PF accounts when switching jobs.

 

  • Self Attestation features: EPFO proposes to introduce a self-attestation feature that will allow members to complete the Know Your Customer (KYC) process without the approval of the employer.

 

  • More Efficient Pension System: Employees are allowed to choose higher voluntary contribution towards Pension. The system also proposes support to the pension system that will make it more efficient with focus on addressing the delays in issuing pension payment orders.

 

  • Seamless User Experience: EPFO 3.0 aims to make all the processes starting from Account Management to filing of claims and transferring funds, more efficient, user-friendly and faster.

 

How do the EPFO 3.0 ATM Cards work?

EPFO ATM card is a revolutionary update being introduced in EPFO 3.0 that enables withdrawals from EPF accounts. As of now, members have to wait anywhere between 7 to 10 days for withdrawals from the EPF account. The process required either online or offline requests and employee attestation.

With the new features, members can access their PF accounts directly from designated ATMs for instant access of their funds without waiting for approval from employers. EPFO ATM withdrawal thus eliminates lengthy waiting time, and offers the much-needed convenience and instant access to their savings.

The EPFO ATM card functions like a regular Bank ATM card and allows members to withdraw up to 50% of their total savings in the PF accounts without lengthy approval processes. Similar to Bank ATM transactions, EPFO ATM transactions will require authentication via OTP, PIN, or Biometric verification for added security.

EPFO Mobile App

The proposed launch of the EPFO Mobile App through EPFO 3.0 is set to be a game-changer. The EPFO Mobile App will make it easier to manage your EPF account. It will allow you to quickly check your account balance, track contributions, and file claims from the convenience of your living room or when on the move through your Smartphone. The user-friendly interface is designed to save both time and effort, making it easier to have full control of your retirement savings and manage your account on the go. Regardless of whether you are at home or on the move, everything you need will be at your fingertips.

Flexibility in Pension Contributions

EPFO 3.0 proposes changes in Pension contributions by making it more flexible. Currently, EPF contributions are fixed at 12% of the Basic salary plus Dearness Allowance, split equally between the employee and employer. One part of the contribution goes into the Employees’ Pension Scheme (EPS). Under EPFO 3.0 the following changes are proposed.

  1. Employees are allowed to choose higher voluntary contributions towards Pension.
  2. They are given the flexibility to opt for different pension schemes.
  3. Enhancing benefits under EPS based on contribution levels.

This is EPFO’s new flexible savings scheme that aims to enhance retirement savings and provide employees with greater financial control and independence.

Self-Correction of Member Personal Details:

Currently, members have to depend on employers to correct discrepancies in the personal information on the EPFO Portal, resulting in undue delays and added Administrative pressure. However, with the EPFO’s new features, members can access their personal details and correct discrepancies without the requirement of supporting documents. The high volume of grievances is primarily related to member profiles and Know Your Customer (KYC) issues. This is nearly 27% of total complaints. These proposed changes aim to drastically reduce these grievances. For example, errors in details like father’s name, spouse name, etc., or nationality that hitherto required online requests and supporting documents, can now be quickly and efficiently updated, thus streamlining the entire process.

Eliminating delays in PF Transfers

For long, there has been a demand to reduce the delays in transferring PF Accounts when members switch jobs. Currently, employer verification is a key step often resulting in significant delay. On an average, the employers took 12 to 13 days to submit transfer claims to the EPFO. As per records, over the past 9 months nearly 20 lakh claims were held up with employers for more than 15 days.

EPFO 3.0 allows employees with fully compliant e-KYC EPF accounts to file transfer claims directly with the EPFO using Aadhaar-based OTPs, without requiring employer intervention. The proposed change is expected to significantly reduce transfer claim processing time by doing away with the bottleneck of employer verification.

EPFO 3.0 – Launch Timeline

Initial announcements revealing formal details about EPFO 3.0 began circulating in early 2023 highlighting the process of digitization and self-service enhancements. As a pilot phase which is still ongoing, certain features like online PF transfer and partial self-correction are already available like under EPFO 2.0.

According to official timelines, EPFO 3.0 is scheduled to be fully operational by June 2025 and will culminate in the complete roll-out of the new infrastructure that includes the EPFO ATM Card system, a revamped Mobile App, and flexible pension contributions.

Conclusion

EPFO 3.0 symbolizes an important step towards modernizing India’s Provident Fund Infrastructure. The aim is to deliver a hassle-free experience that benefits employees across the country, and this is emphasized in user autonomy, instant access to funds, digital security, and streamlining the entire workflow. Even though a few challenges remain, especially in implementing robust security measures and ensuring widespread digital literacy, the long-term prospects suggest a more robust, transparent, and member-friendly system.

In simple terms, EPFO 3.0, the latest updates on EPFO Reforms, is a comprehensive digital overhaul of the EPFO platform, that is designed to provide members greater control over their accounts, introduces ATM-enabled withdrawals and streamlines PF transfer with reduced paperwork.

GetifyHR is a highly reputed Payroll and Statutory Compliance Service Provider with years of experience in handling matters relating to Payroll and Statutory Compliance that includes Employees Provident Fund.  We are fully geared to handle all the proposed changes and will be able to fully support all our valued clients and the employees once these changes are notified. We are there to lend a shoulder to all these changes and all forthcoming changes in all aspects of Payroll Processing, HR Management and Statutory Compliance requirements.

Budget 2025 and the Effect on Salaried Employees

Budget 2025 and the Effect on Salaried Employees

by with No Comment News & Updates

The Hon. Finance Minister Smt. Nirmala Sitharaman presented her 8th Union Budget in Parliament on 1st  February 2025. This Budget has been widely welcomed by all sections of society and hailed for its forward-looking and growth-oriented proposals. A special highlight is the tax reliefs for Middle-class taxpayers, especially salaried employees.

In this article, we will analyze the benefits that salaried employees will get through the proposed changes.

Budget 2025 has increased the nil-tax threshold to ₹ 12.75 lakhs for salaried employees and individuals with a higher standard deduction of ₹ 75,000 in the New Regime made in Budget 2024 from the earlier ₹ 50,000.  However, for those who opt for the Old Regime the standard deduction remains at ₹ 50,000. The tax exemptions from the previous ₹ 7 lakhs to ₹ 12.75 lakhs is a major jump and has been hailed as the biggest jump in the past 4 decades. The budget also provides TDS relief to senior citizens and other depositors making fixed deposits more attractive.

Major changes in Income Tax slabs and rates in Budget 2025

Considering the Old Tax Regime and the New Tax Regime, no changes have been proposed in the latest budget proposal. Instead, the Finance Ministry has adjusted the slabs, rates, and rebates in the New Regime (25-26) to make income up to ₹ 12 lakhs tax-free, which was ₹ 7 lakhs in the FY 24-25.

Old Income tax regime: (Existing and applicable for FY 22-23)
Old Income tax slab Income tax rates
Income slab of 2.5 lakh Nil
Income slab of 2.5 to 5.0 lakh 5%
Income slab of 5.0 to 10.0 lakh 20%
Income slab of 10.0 lakh and above 30%

 

New Income tax regime (Existing and applicable for FY 22-23)
New Income tax slab ( Previous) Income tax rates
Income slab of 2.5 lakhs Nil
Income slab of 2.5 to 5.0 lakhs 5%
Income slab of 5.0 to 7.5 lakhs 10%
Income slab of 7.5 to 10.0 lakhs 15%
Income slab of 10.0 to 12.5 lakhs 20%
Income slab of 12.5 to 15.0 lakhs 25%
Income slab of 15.0 lakhs and above 30%

 

New Income tax regime (Revised in Budget 2023)(For FY 23-24)
New Income tax slab (Revised) Income tax rates
Income slab of 3.0 lakhs Nil
Income slab of 3.0 to 6.0 lakhs 5%
Income slab of 6.0 to 9.0 lakhs 10%
Income slab of 9.0 to 12.0 lakhs 15%
Income slab of 12.0 to 15.0 lakhs 20%
Income slab of 15.0 lakhs and above 30%

 

The IT slab under the New Regime (24-25) are detailed below:
New Income Tax Slabs Income Tax rates
Income slab of 3.0 lakhs Nil
Income slab of 3.0 to 7.0 lakhs 5%
Income slab of 7.0 to 10.0 lakhs 10%
Income slab of 10.0 to 12.0 lakhs 15%
Income slab of 12.0 to 15.0 lakhs 20%
Income slab of 15.0 lakhs and above 30%

 

The Revised slabs under the New Regime (25-26) are detailed below:
Total Income Income tax Rates
Up to ₹ 4,00,000 Nil
4,00,001 to 8,00,000 5%
8,00,001 to 12,00,000 10%
12,00,001 to 16,00,000 15%
16,00,001 to 20,00,000 20%
20,00,001 to 24,00,000 25%
Above 24,00,000 30%

The Income slabs proposed under the New Tax Regime in Budget 2025 are a great boon to salaried employees as it helps them to save Income tax up to a maximum of ₹1,14,000. These savings are based on the premise that an individual claims only the standard rebate of ₹ 75,000 under the new tax regime. However, a salaried employee can save more tax if he claims a deduction on his employer’s contribution towards the National Pension Scheme (NPS).

The savings under the proposed New Income tax regime are detailed below:
Total

Taxable

 Income

 Tax Payable

as per the current

Tax rates 2024-25

 Tax payable as per

the

New Tax rates

2025-26

 Income tax saved through

Budget 2025
12,75,000 83,200 0 83,200
15,00,000 1,30,000 97,500 32,500
16,00,000 1,54,000 1,13,100 40,300
20,00,000 2,78,200 1,92,400 85,800
24,75,000 4,26,400 3,12,000 1,14,000
25,00,000 4,34,200 3,19,800 1,14,000

 

Comparison of tax payable (New Regime) for the FY 24-25 (AY 25-26) and FY 25-26 (AY 26-27)
Tax  Payable FY 24-25 (AY 25-26) Tax Payable FY 25-26 (AY 26-27)
Total Taxable Income Tax Rates Tax Payable Total Taxable Income Tax Rates Tax Payable
Up to 3,00,000 0% ₹ 0 Up to 4,00,000 0 % ₹ 0
3,00,001 to 7,00,000 5% ₹ 20,000 4,00,001 to 8,00,000 5% ₹ 20,000
7,00,01 to 10,00,000 10% ₹ 30,000 8,00,001 to 12,00,000 10% ₹ 20,000
10,00,001 to 12,00,000 15% ₹ 30,000 12,00,001 to 16,00,000 15% ₹ 60,000
12,00,001 to 15,00,000 20% ₹ 60,000 16,00,001 to 20,00,000 20% ₹ 80,000
15,00,001 to 25,00,000 30% ₹ 1,50,000

 

The proposed amendments in Budget 2025 may significantly boost the number of taxpayers who opt for the new tax regime. The middle-class income groups stand to gain the most, with the tax-free limit now raised up to ₹ 12.75 lakhs for salaried individuals and individuals, and the revised slabs reducing the overall taxable liability. Statistics show that 72% of taxpayers had opted for the New Tax Regime (23-24) up from 66% in the previous year. This trend is likely to continue due to the benefits the proposed amendments provide. However, taxpayers who benefit from deductions such as HRA, Home loans, and investments may still prefer the Old Tax Regime.

The proposed changes in Income Tax rates and rebates would put more spendable income in the hands of taxpayers which would hopefully encourage tax filing compliance. The flip side is that it could possibly discourage investment in savings schemes.

Conclusion

The proposed amendments in the Union Budget 2025 will greatly benefit the middle-class taxpayer, especially the salaried employee, and leave more disposable income in the hands of individuals thus enabling higher spending and investments.

Experts believe that the much-needed tax relief was necessary for boosting consumer demand, especially as it allows more disposable income in the hands of middle-class taxpayers. The proposed changes are bound to empower the taxpayer and promote greater financial inclusivity. GetifyHR has been at the forefront of supporting the needs of our clients in fulfilling their Income Tax needs and is fully equipped to handle the proposed changes. We are there to assist all our clients in seamlessly handling the statutory compliance requirements and keep the company fully compliant.

Notice Period

Comprehensive Guide to Understanding Notice Period

by with No Comment News & Updates

In the ever-changing world of work, the notice period is essential to facilitating seamless job changes. It facilitates the transition from an employee’s leaving to their replacement’s onboarding, assisting in the preservation of operational continuity. This thorough study explores the technical aspects of notice periods, with special attention to regulations, employee transitions, and notice period significance in India.

Understanding Notice Periods

A notice period is a set amount of time that an employee has to work out before leaving an organization. It’s a contractual requirement meant to provide the employer enough time to find a successor and maintain uninterrupted business operations.

An employee must serve out a notice period following their resignation from their position in order to formally quit the company. It is a common provision in employment contracts and differs among businesses, sectors, and nations. Notice periods are intended to give both the employer and the employee the time to make the necessary preparations for a seamless transfer.

Notice Period in India

In India, labor laws, corporate policy, and employment contracts all regulate notice periods. Depending on the industry norms and the seniority of the role, the notice period in India may last anywhere from a few days to several months. Junior employees usually have a notice term of thirty days, whereas senior executives typically have a notice period of sixty to ninety days.

Legal Framework:

Notice periods are somewhat regulated by the Indian labor law system, which includes the Industrial Disputes Act, 1947, and the Shops and Establishments Act. For example, a workman (non-managerial employee) who has been hired by the recruiter for a minimum of one year is entitled to one month’s notice before termination under the Industrial Disputes Act, or pay in lieu of notice. Notice periods in India, however, are mostly dictated by the terms specified in the employment contract for managerial and executive responsibilities.

Notice Period Policies
Duration and Structure:
  • Fixed Notice Periods: The majority of Indian businesses have a set notice time, which is typically outlined in the employment contract. This could be the same at every level or different depending on jobs and seniority.
  • Probationary Periods: Since this stage is seen as a trial term, the notice time is often shorter during probation, ranging from immediate to one week.
  • Tailored Notice Periods: Organizations may occasionally bargain for a notice period that is determined by certain agreements with employees.
Buyout Option:

The buyout option pays the company for the portion of the notice period that is not used by employees who leave before it finishes. Usually, the compensation sum is equal to the wage for the unsettled notice period. With this option, workers can move on to new possibilities with flexibility and know that their employer will be paid for their abrupt resignation.

Garden Leave:

Some businesses offer “garden leave,” which allows workers to serve their notice term away from the office. This keeps outgoing staff members from gaining access to private data or stealing clients and coworkers. As per the notice period policies, employees continue to get their pay and benefits throughout this time.

Immediate Termination:

Employers are entitled to instantly terminate an employee’s employment without any notice in circumstances of gross misconduct or contract violations. To prevent legal issues, these acts must be justified and documented.

Employee Transitions
Handover Process:

To guarantee a seamless employee transition, a clearly established handover procedure is essential. It entails the leaving employee giving their expertise, duties, and continuing tasks to a new hiring or a selected coworker. Sessions for exchanging expertise and thorough documentation are crucial parts of this process.

Knowledge Transfer:

Transferring knowledge effectively is essential to reducing interruptions. Employees who are leaving should record their work procedures, important contacts, and any unresolved matters. Frequent encounters with the successor can help to impart implicit knowledge that might not be recorded..

Exit Interviews:

Exit interviews offers insightful information about the factors that led to an employee’s leaving. Organizations can use this input to pinpoint areas for development and make adjustments to promote staff retention.

Successor Training:

In the event that a successor has been chosen, giving them sufficient training during the notice period guarantees that they are equipped to assume the position. Both organizational culture and technical factors should be included in this training.

Effects of Notice Periods on Workers

Notice period in India has a big influence on a worker’s career change and job hunt. An employee’s capacity to quickly investigate other options may be hampered by a prolonged notice period. In the event that the departing employee cannot find employment quickly after quitting, it could potentially result in financial difficulties. Conversely, a shortened notice period could make it more difficult for the employer to maintain business continuity.

Instigation on Morale and Productivity of Employees

Reduced Morale: Workers who are keen to explore new prospects may experience a decline in morale as a result of prolonged notice period policies. Job satisfaction and productivity may suffer as a result.

Decreased Engagement: Workers with extended notice periods may become disengaged from their jobs and concentrate more on looking for new employment than on their existing duties.

Higher Turnover: Employees who feel trapped by lengthy notice periods are more inclined to quit suddenly and before using up the entire notice period, which raises the turnover rate.

Sway on Business Operations and Employers:

Trouble Finding New Employees: Extended notice periods may complicate the process for businesses in finding qualified replacements promptly, which could cause disruptions to business operations.

Increased Costs: During the notice period, employers may have to pay more for overtime, temporary workers, or outsourcing in order to fill open positions.

Intellectual Property Loss: Prolonged notice periods in India raise the possibility that departing employees will take important information or knowledge with them, which might be detrimental to the company.

Effect on the Job Market:

Whole Talent Acquisition Difficulties: Prolonged notice periods can impede the free flow of talent in the employment market, making it more challenging for businesses to quickly fill open positions.

Decreased Employee Mobility: Strict notice period regulations/ requirements may restrict an employee’s ability to move about, which may hinder their capacity to learn new skills and pursue new career prospects.

Economic Impact: By impeding the effective use of human resources, extended notice periods may be a factor in the economic downturn.

Conclusion

Understanding the intricacies of notice periods is essential for recruiters to manage employee transitions effectively. In India, notice periods are influenced by a combination of contractual agreements and labor laws. The best Compliance and Payroll Service Provider, GetifyHR, will provide the help you need if you require any clarification understanding notice periods. Our services provide error-free payroll processing, maintain compliance, and enhance employee satisfaction. By implementing well-defined notice period policies, facilitating smooth handovers, and maintaining clear communication, recruiters can ensure seamless transitions that benefit both the organization and the employees. As the employment landscape continues to evolve, GetifyHR ensures that its clients always stay informed about best practices and legal requirements surrounding the notice periods in India.

Budget Blog

Budget 2024: New Employment-linked Incentives for Employees and Employers in new Budget

by with No Comment News & Updates

In the Union Budget presented on July 23, 2024 Ms. Nirmala Sitharaman stated, “As part of the Prime Minister’s package, our government will implement the following three schemes for employment-linked incentive: enrollment in the EPF, focus on recognition of first-time employees, and support to employees and employers’ scheme.”

First-time employees who enroll in the EPFO are expected to profit from these three employee-linked incentive schemes:

  • Scheme A (one month’s salary for freshers)
  • Scheme B (job creation in manufacturing)
  • Scheme C (assistance to employers)

Bird’s Eye View:

Scheme A: one month’s salary for freshers

Those who are First-time Employment will receive a subsidy of up to ₹15,000, or one month’s salaries, under this policy. It pertains to all industries and individuals who are just starting their career with organization registered under EPFO and make less than ₹1 lakh a month. Hon’ble FM Ms.Nirmala Sitharaman declared that the employee will receive the subsidy in three installments (Direct Benefit Transfer).

Before collecting the second installment, the employee must complete a required online course in financial literacy in order to be eligible for this. Employer reimbursement of the subsidy is required if the first-time employee’s job ends within a year of hiring. The duration of this program is two years.

Here is a detailed analysis of each scheme, including its main features and advantages.

Phenomenal Advantages:

Financial Assistance: New hires will be given a subsidy equal to one month’s salary, up to ₹15,000, which will be paid out in three installments as Direct Benefit Transfer.

Inclusivity: Relevant to new workers entering the workforce with organization registered under EPFO who make less than ₹1 lakh per month, across all industries.

Financial Literacy: To encourage financial understanding, employees must successfully finish a required online course in financial literacy before becoming eligible for the second installment.

Employment Retention Incentive: To encourage longer-term employment, employers are required to return the subsidy if the employment job ends within a year.

Breakthrough: Meant to make it easier for new hires to adjust to the workplace during their first few months.

Scheme B: Manufacturing Sector Job Creation

Employers-both corporate and non-corporate that have made EPFO contributions for the past three years are eligible. It can be used in the manufacturing industry for significant first-time employee hiring. The employer is required to hire a minimum of 50 or 25% of the baseline in prior non-EPFO enrolled workers.

Employer Incentive: Designed to encourage long-term EPFO membership, this incentive is applicable to companies that have contributed to the organization for three years.

Targeting significant recruiting in the manufacturing industry, the law requires firms to add at least fifty new employees, or 25% of their current workforce, whichever is higher.

Economic Growth: The program seeks to promote industrial growth and economic development by concentrating on the manufacturing sector.

Insight: Manufacturing employers who have contributed to the EPFO for at least three years will be qualified. Nonetheless, if the number of EPFO employees from the prior year is less than 50, the company must hire at least 25% of the baseline.

Employees having a monthly salary of up to Rs. 1 lakh who are EPFO-registered direct payroll (in-sourced) would be eligible.

The four-year subsidy will be split evenly between the company and the employee. It will be computed as follows: 24% of the wage or salary for the first and second years, 16% for the third, and 4% for the Fourth.

In addition to the subsidy specified under Scheme A, the employer will receive this one as well. However, should the employee’s employment end within a year, the company will be required to reimburse the subsidy amount.

Breakthrough: Scheme B is a focused strategy to support the manufacturing industry by providing incentives for large-scale labor growth.

Scheme C: Assistance to Employers in Boosting Employment

This program is applicable to employers who sustain the higher level of employment and add at least two employees (for companies with fewer than fifty employees) or five employees (for companies with fifty or more employees) above the baseline (the number of EPFO employees from the prior year). It also applies to employees whose monthly salary does not exceed ₹1,00,000.

New hires under this section do not necessarily have to be members of EPFO. Under this, the government would pay the company back for the additional employees hired the year before, up to ₹3,000 per month, for the EPFO employer contribution. This will last for two years. It does not apply to employees who are covered by Scheme B.

Baseline Increase: Encourages employers to hire more people than the baseline from the prior year.

Financial Compensation: The government would pay back the EPFO employer contribution for a maximum of ₹3,000 per month for two years for each new employee hired.

Wide Applicability: This program is available to a greater variety of workers because it does not require new employees to be EPFO members.

Suitable for Varying Business Sizes: Customized cutoff points for both big and small employers guarantee that companies of all sizes can profit.

Emphasis on High-Salary Jobs: Applied to workers earning up to ₹1 lakh per month, this initiative aims to improve workforce quality by focusing on higher-paying positions.

Insight:

Scheme C- will be eligible if they add at least two employees (for those with less than fifty employees) or five employees (for those with fifty or more employees) above the baseline.

The government will repay employer contributions to EPFO up to Rs. 3,000 per month for a period of two years. On the other hand, payment for the prior quarter will be made on a quarterly basis if a company creates more than 1000 jobs.

Employees who make less than Rs. 1 lakh per month, regardless of whether they are new to EPFO, will be eligible under this scheme.

Enhancement: The goal of Scheme C is to promote long-term job growth by giving financial assistance to companies that hire more people.

Conclusion:

Union Budget 2024 is known to be brimming with Employment-Linked Incentive Schemes altogether. If you are in need of any clarification in this regard, GetifyHR, the paramount Compliance and Payroll Service Provider will lend the needed assistance. Our services preserve compliance, improve employee happiness, and guarantee flawless payroll management.

Blog EPF

EPFO – Standard Operating Procedure for Joint Declaration

by with No Comment Labour ActNews & Updates

The Employees Provident Fund Organization (EPFO) has brought about changes to the Standard Operating Procedure (SOP) for receiving Joint Declarations for correcting mistakes in members’ Universal Account Number (UAN) profile, and employers’ EPF Accounts, and the procedure to be followed by the Field Office.

The notification to amend the SOP was released by the EPFO vide No: SU/2022/Rationalisation of work areas/Joint Declaration/17 dated 11-04-2024.

Purpose of the Amendment

The purpose of the amendment is to describe accurately and in detail the procedures of receipt of Joint Declaration for corrections in UAN profiles by the members and employers and the procedure to be followed by the field office in making these corrections. The proposed changes to SOP will make it easier and simpler to minimize both incompleteness and mismatches.

The changes would also ease the difficulties encountered in claim settlement due to data mismatches, especially in parameters such as:

  1. Name
  2. Gender
  3. Date of Birth
  4. Father’s Name/Mother’s Name
  5. Relationship
  6. Marital status
  7. Date of Joining
  8. Reason for Leaving
  9. Date of Leaving
  10. Nationality and
  11. Aadhaar Number.

The SOP for Joint Declaration aims to streamline the process of rectifying discrepancies in member profiles, thereby reducing claim rejection and minimizing the risk of impersonation and fraud through the manipulation of UAN.

The process

The process entails a collaborative effort between the employees and the employers with due authentication by a process of Initiation, Verification, and Approval by the Field Office (FO).

1.  Initiation

As and when a member files a Joint Declaration, it gets authenticated by the Employer. The submitted documents are then verified for accuracy by the designated Verifier within the FO.

2.  Verification

The modification request and supporting documents are then cross-checked by the designated Verifier to ensure compliance with EPFO guidelines and regulations.

3.  Approval

Upon verification, the JD is forwarded to the designated Approver for approval. This could be the Regional Provident Fund Commissioners (RPFC), Additional Provident Fund Commissioners (APFC), or other authorised officers of the organization.

List of acceptable documents that can be submitted for the different parameters

Name and Gender
  1. Aadhaar (mandatory)
  2. Passport
  3. Death Certificate
  4. Birth Certificate
  5. Driving License
  6. Service photo identity card issued by Central, State, UT Govt./PSU/ Banks
  7. School Leaving Certificate (SLC) or School Transfer Certificate (TC) or SSC certificate or Mark Sheet issued by Board/ University containing name and photograph.
  8. Bank passbook having the name and Photograph cross-stamped by the Bank Official.
  9. PAN Card/e-PAN
  10. Ration/PDS Photo Card
  11. Voter ID/e-Voter ID
  12. Pensioner Photo Card/Freedom Fighter Photo Card
  13. CGHS/ECHS/Medi-Claim Card with Photo issued by State/Central Govt/PSUs/Rashtriya Swasthya Bima Yojana (RSBY) Card.
Date of Birth
  1. Birth Certificate issued by the Registrar of Births and Deaths.
  2. School Leaving Certificate (SLC) or School Transfer Certificate (TC) or SSC certificate containing Name and Date of Birth or Marksheet issued by any recognized Government Board or University.
  3. Service records certificate issued by the Central/State Government Organizations.
  4. Where proof of date of birth is not available, a Medical Certificate issued by a Civil Surgeon after medical examination of the member and supported with an affidavit on oath by the member duly authenticated by a Competent Court.
  5. Aadhaar
  6. Passport
  7. PAN Card
  8. Central/State Pension Payment order
  9. CGHS/ECHS/Medi-Claim Card issued by Central/State/UTs Govts./PSUs having Photo & Date of Birth.
  10. Domicile Certificate issued by the Government.
Father / Mother name, and Relationship
  1. Passport of Father/Mother
  2. Ration card/PDS Card
  3. CGHS or ECHS/ Medi-Claim Card with photo issued by Central/ State Govt./PSUs.
  4. Pension Card
  5. Birth Certificates issued by Municipal Corporation, and other notified local Government bodies like Taluk, Tehsil, etc.
  6. Marriage Certificate issued by the Government.
  7. Photo ID card issued for schemes like Bhamashah, Jan-Aadhaar, MGNREGA, ARMY Canteen Card, etc., by Central/ State Govt.
Marital Status
  1. Marriage Certificate issued by the government
  2. Aadhaar Card
  3. Divorce Decree
  4. Passport.
Date of Joining
  1. Employee register
  2. Attendance register
  3. Appointment letter or any other document as establishments maintain under any central or State Labour Act
  4. Letter of establishment on the letterhead duly signed by the Employer or the Authorized Signatory showing the date of joining, supported by ECR of the employee during the said period.
Reason for Leaving
  1. Resignation letter
  2. A letter from the organization on their letterhead clearly stating the reasons for leaving, supported by the ECR of the employee during the said period.
  3. Termination letter issued by the employer to the employee.
  4. Any document as the organization deems fit to establish the reason for exit of the employee duly signed by the Employer or the authorized signatory of the organization on their letterhead.
Date of Leaving
  1. Resignation letter/termination letter
  2. Experience certificate or any other document an organization maintains under any Central or State Labour Act
  3. Wage slip/salary slip/full and final letter
  4. Letter of organization on their letterhead clearly stating the date of joining and duly signed by Employer or the authorized signatory.
Nationality
  1. Copy of Passport
  2. Copy of Person of Indian Origin (PIO) card issued by the Govt. of India
  3. Long Term Visa (valid) along with a Foreign passport (valid or expired) of country of origin issued to minority communities of Pakistan, Afghanistan and Bangladesh, namely Hindus, Christians, Sikhs, Buddhists, Jains, and Parsis.
  4. Valid Visa issud to a Foreign National along with a valid Foreign Passport.
  5. Tibetan Refugee Card (supported by one more ID)
Aadhaar
  1. Member Aadhaar card or e-Aadhaar card with details of linked active mobile phone.
Submission of Documentary Proof

All changes to parameters have been classified into Minor and Major changes and these have been detailed in Table 2 of the SOP.

All requests for Minor or Major corrections will have to be supported by documentary proof as prescribed in Annexure 1.  For Minor corrections, at least 2 documents from the list of documents mentioned in Annexure 1 for that particular parameter are required to be submitted. For Major corrections, at least 3 documents from the list of documents mentioned in Annexure 1 for that particular parameter are required to be submitted.

Frequency of Corrections

The SOP has fixed the frequency at which corrections to various parameters can be made through the Joint Declaration Form. The same is tabulated hereunder:

Sl. No. Parameters No.of times changes can be made

1.

Member Name

1
2. Gender

1
3.

Date of Birth

1
4. Father/Mother Name

1
5. Relationship

1
6. Marital Status

2

7.

Date of Joining

1

8.

Date f Leaving

1

9.

Reason for Leaving

1

10.

Nationality

1

11.

Aadhaar

1

The Procedure

The EPFO has streamlined the process of updating profile parameters by embracing digital technology thus making it accessible through the online platform. The process is simple and both the employees and employers alike can leverage the power of digital technology to submit the JD online.

Firstly, log on to the EPFO website at https://www.epfindia.gov.in/.  Then log into the Employee login using the Universal Account Number (UAN) and the Password. Employers can use their EPF credentials to log in. After logging in, click on the “Online Services” option on the portal and look for the Update or Correct EPF details, and select the Joint Declaration Form (JDF). Once the Form opens, fill in the required details accurately and ensure that all the details called for are filled in. Depending on the parameter that you are updating or changing, upload the supporting documents.

Next, submit the Form after fully verifying that the details provided by you are correct. After submission, you can track the status of the Joint Declaration Form submission through the EPFO portal and ensure that the processing is taking place and the details are fully updated.

Once the changes are approved, the member’s photo which is retrieved by the EPFO interface with UIDAI Aadhaar data will become visible in the member profile on their portal and the IT interface of various authorities.

Conclusion

Through this highly efficient and structured process, EPFO not only aims to maintain the profile integrity of the member but also hopes to minimize claim rejections and reduce the risk of impersonation and fraud. By leveraging technology through the Unified Portal Application, EPFO endeavors to enhance transparency, streamline efficiency, and usher in greater accountability in its operations. EPFO’s commitment to providing the best of technology for the benefit of employees and employers alike demonstrates a step towards a brighter and more streamlined future on social security and the management of EPF Accounts.

GetifyHR has been fully supportive of the needs of the employees and employers in handling EPF, and we have always updated ourselves immediately on all the changes brought in by EPFO from time to time. We are fully geared to handle these changes and support our clients and through them the employees in all aspects of EPF.

HR Work culture

How Human Resource activities can boost Work Culture?

by with No Comment BusinessNews & Updates

The success of any organization wholly rests with the Human Resources Management team. Where the focus is to achieve the objectives of the organization, clear procedures have to be followed and this entails adopting and implementing rules and procedures that promote employee engagement and well-being. The HR team recruits and helps keep talent so that greater productivity is achieved by enabling a positive workplace culture.

The efficiency of the HR team fosters open communication and this not only helps in creating a positive work culture but also strengthens the bond between the Management and the Employees. In this article, we explore the strategies implemented by the HR team to boost workplace culture.

What is Work Culture?

Your work culture is the shared set of practices that guide your organization. These include your values, your beliefs, and your attitudes as reflected in the way you respond to your employees and customers. Work culture has a direct bearing on the types of candidates you attract for various open positions in your organization. A strong and positive work culture boosts productivity, reduces employee turnover, and improves employee engagement.

Work culture is a vital part of the organization’s core culture. It is prone to grow and change according to the circumstances and is, therefore, different from the organization’s core values which largely remain the same over time.

What is the Importance of Work Culture?

A positive work culture will strongly impact employee experience.  It will have an impact on individual and team morale, employee engagement, and job satisfaction. A positive workplace culture creates a loyal and strong team of employees. On the other hand, a negative work culture promotes a toxic workforce that can curtail the growth of the organization and make it difficult to hire talent and retain them. Surveys have shown that positive company values and culture rank as the top influence on whether a candidate decides to accept a job offer. On the contrary, poor company culture is the main reason for employees to leave their jobs.

Factors that help in developing work culture?

Several factors help in developing a positive work culture. Let’s look into some of these:

  1. A supportive leadership.
  2. A feeling of being respected.
  3. Whether the actions of leaders align with the core values.
  4. Proper benefits, perks, and amenities.
  5. Learning opportunities.
  6. Opportunity for professional development.
  7. Job security.
  8. Frequency and quality of reorganization.
What are the strategies needed by HR to create a positive work culture?
Exceptional Onboarding Experience:

Provide an exceptional onboarding experience to new hires. A well-designed onboarding process is crucial for integrating new hires into the organization’s culture. HR can streamline the transition by providing comprehensive orientation, introducing company values, and fostering smooth relationships with colleagues.

Competitive Compensation:

The best way to attract and retain the best of talent is by providing fair and competitive compensation packages. HR can develop and implement competitive compensation and benefit packages that encourage and retain the best of talent. They play a vital role in benchmarking salaries, assessing market trends, and ensuring that employees feel valued for their contributions.

Team Building Activities:

Encourage team-building activities in your organization. HR-initiated team-building activities promote camaraderie, collaboration, and trust among employees. In an organization that oversees a distributed team, the biggest challenge is to establish genuine connections. By organizing regular team building activities the HR can help bring that “human” touch back to your workplace. These activities can range from informal gatherings to structured workshops aimed at enhancing teamwork and communication.

Promote Recognition:

Recognizing and rewarding employees for outstanding results would boost morale and motivation. This would encourage employees to continue performing at impressive levels and make them feel valued within the organization. This will act as a motivation to their peers to improve their performance, thus enhancing work culture and fostering friendly competition that leads to better performance. HR can implement recognition schemes, including employee of the month awards, peer-to-peer recognition, and milestone celebrations.

Collecting Feedback:

Collecting employee feedback is one of the most effective engagement initiatives. Regular feedback mechanisms, such as surveys and suggestion boxes, enable HR to gauge employee sentiment and identify areas for improvement. Actively listening to employee feedback demonstrates a commitment to their well-being and fosters a culture of continuous improvement.

Prioritize Welfare Programs:

The priority is to create a healthy work-life balance and the HR team must maintain the mental and physical health of the employees for better retention. When individuals are tired, stressed, or on the verge of burnout, they cannot be expected to perform at their best. HR plays a vital role in prioritizing employee welfare by offering benefits such as health insurance, wellness programs, flexible work arrangements, and family-friendly policies. These initiatives enhance employee satisfaction and promote work-life balance.

Improve Communication:

A healthy work culture can be brought in only with effective communication. Clear and open communication is the key to the success of any team and this is especially true for HR teams. In most organizations, HR is the main point of communication between the top management and the employees. HR can facilitate transparent communication channels, provide regular updates on organizational changes, and encourage open dialogue between management and employees.

Training and Development:

Investing in employee development through training courses and professional development programs demonstrates a commitment to individual growth and skill enhancement. HR can give employees the chance to update their knowledge and skills through training and development programs. This will enable the employees to feel appreciated, improve job satisfaction, and inspire them to work to their maximum potential. HR can identify training needs, organize workshops, and provide resources to support ongoing learning.

Accept New Technology:

The workplace is ever-evolving and continues to change at great speeds. New processes disrupt proven ways of completing jobs and new-generation employees come with different expectations and behaviors. Every organization is prone to the effects of change, in both technology and process. Embracing technology innovations streamlines processes, enhances productivity, and fosters a culture of innovation. HR can champion the adoption of new tools and platforms that improve workflow efficiency and facilitate remote collaboration.

Employment Engagement Survey:

Employment Engagement is a concept that highlights how the employees feel towards an organization and how their feelings translate into actions and behaviors at work. An employee engagement strategy is, therefore, the steps you take to build positive engagement at work.

Conducting regular engagement surveys allows HR to assess employee satisfaction levels, identify areas of concern, and implement targeted interventions. These surveys serve as valuable tools for measuring the effectiveness of HR initiatives and fostering a culture of continuous feedback and improvement.

Conclusion

In conclusion, human resource activities play a pivotal role in shaping and enhancing work culture. By prioritizing elements such as onboarding experiences, competitive compensation, team building, recognition, feedback collection, welfare programs, communication improvement, training and development, technology adoption, and engagement surveys, HR can foster a positive and productive work environment conducive to organizational success. Investing in work culture isn’t just a choice – it’s a strategic imperative for businesses aiming to thrive in today’s competitive landscape.

At GetifyHR, we have invested our time and effort in enhancing the work culture at different client locations across the country, with the sincere support of the HR teams. We have been able to provide regular updates and ideas to streamline the process so that employees have access to the best practices and technology that not only improves the work culture but also enhances productivity.

Employee Training Methods and Techniques

10 Best Employee Training Methods and Techniques

by with No Comment BusinessNews & Updates

Introduction

In today’s rapidly evolving corporate landscape, organizations are realizing the significance of investing in employee training and development. It not only enhances individual skills but also improves overall organizational performance. With the advent of technology, various training methods and techniques have emerged to cater to diverse learning needs. This article explores the top 10 employee training methods and techniques that have proven to be highly effective.

1.  E-Learning

E-learning, a popular training method, involves the use of electronic devices and online platforms to deliver educational content. E-learning has become one of the most widely used employee training methods, especially in the post-pandemic world where work-from-home has become the norm and employees can’t attend in-person training sessions. It offers flexibility, self-paced learning, and extensive accessibility, making it ideal for remote employees or those with busy schedules.

One-line training sessions keep the employees engaged and enhance their retention power as they combine interactive games, quizzes, gamification, and other activities. It gives employees the freedom to learn on the go with their smartphones. Apart from being interactive, the components can be automated thus reducing usage of time and lowering overhead costs. E-learning is also scalable, giving it the freedom to be upgraded as and when needed.

2.  On-Job Training

On-job training is a hands-on approach where employees learn by performing tasks under the guidance of experienced colleagues. It provides practical knowledge, promotes skill development, and helps new hires integrate into the company culture.

On-job Training enables the active participation of employees by allowing them to learn as they work. This is one of the most effective methods to train employees in a new process. It offers faster user adoption of tools and features and provides better results as it is easier for employees to learn while they are working on a project themselves.

On-job Training also saves money that would otherwise be spent on costly off-site training programs. It enables employees to acquire new skills without disrupting their daily schedule and be productive and also facilitates employees to focus on skills that are most relevant to their jobs.

3.  Instructor-Led Training

Instructor-led training (ILT) is a traditional method that involves a trainer delivering content to a group of employees. It facilitates direct interaction and immediate feedback, fostering better understanding and collaboration among participants. It mimics the physical classroom with an instructor present to lead the training session. This training uses a lecture-style presentation with the support of visual components.

In this form of training, there is direct interaction between the trainer and employees, thus preventing social isolation.

All questions and doubts that arise during the session are responded to quickly and effectively. This is a very effective method to impart complex knowledge that needs personal guidance.

4.  Role Playing

Role-playing encourages employees to simulate real-life scenarios, allowing them to develop problem-solving skills, improve communication, and enhance their ability to handle challenging situations. It promotes active learning and boosts confidence.

In this form of training, both the learner and the trainer act out their roles in a potential workplace scenario. This method is highly effective for employees whose job roles include direct interaction with the client or customers.

Role-playing boosts employee engagement and encourages the learner to utilize problem-solving and critical-thinking skills at the right moment. It also prepares employees to handle critical work scenarios and improves employee-customer interaction skills.

5.  Coaching

Coaching is a personalized training technique where an experienced professional guides and mentors employees to help them achieve specific goals. It focuses on individual growth, skill enhancement, and performance improvement through regular feedback and support.

This method allows employees to ask questions that they may not feel comfortable asking in a regular classroom session during an instructor-led training session. The employees learn by watching the performance of their mentor in real time. Coaching helps to strengthen the relationship between the employees.

6.  Peer-to-Peer Training

Peer-to-peer training involves knowledge sharing among employees within an organization. It fosters collaboration, builds camaraderie, and enables individuals to learn from their peers’ experiences and expertise.

Peer-to-peer learning is a mutual learning technique that involves employees of the same level engaging in collaborative learning.

This technique allows employees to work through new concepts and share ideas with their peers working on the same project. This method provides an opportunity to teach and be taught by one another, and is, therefore, an effective way for organizations to enhance productivity with a stronger workforce.

Peer-to-peer learning encourages greater connectivity, collaboration, and teamwork among the employees. It enhances employee engagement and helps boost productivity.  It also promotes the sharing of knowledge within the organization.

7.  Gamification

Gamification incorporates game elements, such as competition, rewards, and challenges, into the learning process. It increases engagement, motivation, and knowledge retention by making training interactive and enjoyable. It engages learners and makes them more willing to take on repetitive tasks despite the risk of failure, by leveraging psychology.

Gamification encourages the learner to achieve the learning objective thereby increasing engagement and completion rates. The learner receives instant feedback as they progress through the game. To boost employee motivation, they are provided with badges or rewards as they proceed through the game.

8.  Case Studies

Case studies present real-life scenarios for analysis and discussion. They encourage critical thinking, problem-solving, and decision-making skills. By examining past situations, employees can gain valuable insights and apply them to their work.

In this method, employees are presented with a real or fictional complex situation to analyze and use as a reference for arriving at their solutions. While the cases may vary in complexity and detail, learners should be provided with adequate data to analyze the situation and come up with their solutions. Case studies enhance data analytical, decision-making, and problem-solving skills. When employees constantly work on case studies, they gain confidence to handle similar situations in real life. It encourages employees to think outside the box.

9.  Mobile Learning

Mobile learning, also known as m-learning, leverages the convenience of mobile devices to deliver training content anytime, anywhere. It enables employees to access bite-sized modules, quizzes, and videos on their smartphones or tablets.

Mobile learning utilizes familiar technology promoting higher engagement and comfort, and the content is delivered in a variety of forms such as podcasts, videos, and quizzes or in an e-learning format that helps to increase engagement and boosts knowledge retention.

10.  Collaborative Training

Collaborative training involves group activities and projects where employees work together to achieve common objectives. It encourages teamwork, communication, and the exchange of ideas, fostering a culture of continuous learning.

Collaborative training enhances the overall training experience for employees by capitalizing on their skills, ideas, and knowledge. It encourages a shared learning culture by building a work atmosphere where team members are constantly collaborating. This type of training reduces time investment and costs and promotes knowledge retention.

Conclusion

In conclusion, employee training is a crucial investment for organizations seeking to stay competitive in today’s dynamic business environment. By incorporating a combination of all these training methods, companies can ensure the development of a highly skilled workforce capable of driving success.

Investing in employee training is not just an expense; it is a strategic advantage that propels companies toward growth and innovation. We at GetifyHR have been fully supportive of all these activities and many more at our client locations to enhance the performance of their employees and create a strong and committed workforce that propels growth.

Checklist to assist businesses to step into the New Financial Year

How to prepare a checklist to assist businesses to step into the New Financial Year?

by with No Comment BusinessNews & Updates

The closing of the financial year and the opening of the new financial year are significant timelines for the growth of an organization. The financial year ending is a great opportunity to look within and to analyse and assess the performance of the business, a time to take stock and make your plans for the new financial year to come.

These activities, taking stock, analysing, and planning can be overwhelming tasks at times, but they are the key to running a successful business venture. This is also the time to re-assess your goals and to take corrective measures to enable the achievement of these goals in the forthcoming financial year. The best way to achieve this is by closely scrutinizing your finances and reassessing your financial practices. This is the time to prepare your checklist for the new financial year. This will help you to streamline your workflow and give you the head start to make the new financial year a successful one.

Financial year-end Checklist for businesses!

  • Prepare Key financial statements/documents
  • Conduct statutory Audit
  • Renew all the licenses and registrations
  • Reassess your goals and prepare for the future
  • Review your business and marketing plans
  • Consider financing options for expansion
  • Assess employee performance
  • Self-evaluate
1.  Prepare key Financial statements/documents

Apart from paying the Advance Tax, the key financial statements must be accurately prepared to ascertain the financial position of the company. The key financial statements are the Balance Sheet, the Profit and Loss A/c, and the Cash Flow statement. These financial statements provide the details of the Assets and Liabilities of the company, the Profit or Loss, and the Cash flow position of the company.

Overall they allow you to calculate the current ratios, debts, and profit ratios for that particular year.

2.  Conduct Statutory Audit

A statutory Audit is a must for any business that is registered as a Private Limited Company. All the Books of the Company have to be audited before the financial year-end. However, for businesses that are registered as a partnership firm or LLP having a turnover that is below 40 lakhs then, a Statutory audit is not required.

3.  Renewal of Licences and Registrations

Every business owner is required to keep track of all the licenses or Registrations that they have taken for the conduct of their business. Normally, these licenses/registrations are to be renewed every year, especially before the end of the financial year. This activity has to be taken care of by the end of the financial year.

4.  Reassess your Goals and prepare for the future

The goals that you have set for the business have to be first analysed. List out the goals and try to assess whether you have met those goals. If not, analyse and find out the reasons that you could not achieve your goals. Identify the areas that you have failed. Reassess the goals in light of your strengths and weaknesses. A SWOT (Strengths, Weaknesses, Opposition, and Threat) assessment will greatly assist you in providing better insights and allow you to make critical changes in your business goals and activities.  These insights will help you to plan for the year to come.

5.  Reassess your Business and Marketing plans

The end of the financial year is the ideal time to reassess your Business and marketing plans. This will enable you to review your short and long terms goals and make changes accordingly. It will enable you to review your sales and marketing budgets and get proper insights into better business strategies. This activity will also enable the business to review the market potential and the competition and would also throw light on new business opportunities.

6.  Consider additional finance option

If business expansion is one of the changes you envisage or if you need higher cash flow for the new financial year, then it would be worthwhile to consider additional finance options. The additional finance could be for development projects or adding to the company’s assets like purchasing a vehicle, machinery, or other types of equipment.

You can consult with your Bank for business loans, an overdraft, or a business credit card. The choice would depend on your circumstances. If there is an option to avail of a government grant you can proceed with that option. Crowd funding is also an option that you can explore as it is very commonly used nowadays to promote business, especially for start-ups.

7.  Assess Employee Performance

Employees are a vital cog in any business organization. Keeping the morale of the employees high is important and maintaining their loyalty is vital for growth. For this, you need to review your compensation and benefits structure and make sure they are in line with the industry and your business values. The compensation and the benefits that you offer have to be competitive enough if you are to hold on to your efficient employees and improve employee retention.

Companies that maintain such promotional paths reap significant gains in the loyalty and longevity of their employees. If you are looking to foster job satisfaction and loyalty among the employees you have to not only provide incentives but also be ready with a strong growth path that would empower the employees and boost their morale. This apart, planning a vacation with the employees, especially during the lean periods is another way to maintain job satisfaction among the employees.

8.  Self-evaluation and improving leadership

The earlier nine points in the checklist dealt with the performance of the company and its employees.

This checklist is incomplete if it does not have a point about evaluating the leadership and the leadership team. Every company should take time to reflect on its own leadership and the leadership team.

Objectively evaluate the performance during the year that is going to end. Find out the areas where there were shortcomings. Identify the areas that you think need improvement. This could be in the areas of time management, communication with employees, work culture, employee performance review, your understanding of business financials, business acumen, and your knowledge of the industry.

With this information, you will be able to implement a self-improvement plan for the new financial year. This will enable you to schedule time for yourself to not only learn and improve your business leadership skills but also encourage your leadership team to improve performance for their growth and the company’s growth.

Conclusion

Preparing a checklist for the new financial year is a must for any business. This will help you to objectively reassess the performance of the company and provide insights to make necessary changes wherever required to promote greater growth. This activity will help you to prepare better for the forthcoming financial year and guide you to improve your all-around performance.

This is also the time for certain companies, especially those that have challenges in preparing accurate payroll and handling all Statutory compliance issues, to introspect and decide whether they need to get expert assistance in handling their Payroll and HR management. GetifyHR has been a leader in outsourcing Payroll and HR management and has the expertise and technology to handle this critical task with a great degree of accuracy and sophistication. Well, we will be able to handle the financial year-end pressures and ensure a smooth transition to the new financial year with the least bit of stress. Stay 100% compliant with GetifyHR!

 

Budget 2023

Budget 2023 and the effect on salaried employees

by with No Comment News & Updates

Smt. Nirmala Sitharaman, the honorable Finance Minister, presented the Union Budget 2023 in Parliament on 1st February 2023. This is the last full-year budget to be presented by this government before the national elections in 2024. The Budget has been widely welcomed by all sections of society and has been hailed as growth-oriented, forward-looking, and one that will support inclusive growth. In this article, we shall analyze how the 2023 budget would affect the salaried class.

The Budget has several proposals for the benefit of taxpayers in the lowest and highest tax bracket.

The proposals also include several proposals for the benefit of salaried individuals, senior citizens, and pensioners. In her budget speech, the Finance Minister has some important announcements for hardworking middle-class citizens who pay taxes. This tax regime called the new income tax slabs is set to be the default regime in the future.

However, the old tax regime has not been abolished and taxpayers now have the option to choose between these two regimes when paying taxes.

Major changes in Income Tax slabs & rates as proposed in budget 2023.

The first change made in the budget 2023 relates to the rebate on Income tax. Rebate limit of Personal Income Tax to be increased to ₹ 7.0 lakh from the current ₹ 5.0 lakh in the new tax regime.  Thus, persons in the new tax regime with income up to ₹ 7.0 lakh need not pay any tax.

The tax structure in the new personal income tax regime, introduced in 2020 with six income slabs to change by reducing the number of slabs to five and increasing the tax exemption limit to ₹ 3.0 lakh.

The tax rates as per the Old and New regimes are given hereunder.

Old Income tax regime: (Existing & Continuing)
Old Income tax slab Income tax rates
Income slab of 2.5 lakh Nil
Income slab of 2.5 to 5.0 lakh 5%
Income slab of 5.0 to 10.0 lakh 20%
Income slab of 10.0 lakh and above 30%
New Income tax regime (Existing and applicable for FY 22-23)
New Income tax slab ( Previous) Income tax rates
Income slab of 2.5 lakh Nil
Income slab of 2.5 to 5.0 lakh 5%
Income slab of 5.0 to 7.5 lakh 10%
Income slab of 7.5 to 10.0 lakh 15%
Income slab of 10.0 to 12.5 lakh 20%
Income slab of 12.5 to 15.0 lakh 25%
Income slab of 15.0 lakh and above 30%
New Income tax regime (Revised in Budget 2023)(For FY 23-24)
New Income tax slab (Revised) Income tax rates
Income slab of 3.0 lakh Nil
Income slab of 3.0 to 6.0 lakh 5%
Income slab of 6.0 to 9.0 lakh 10%
Income slab of 9.0 to 12.0 lakh 15%
Income slab of 12.0 to 15.0 lakh 20%
Income slab of 15.0 and above 30%

The tax payers still have the option to choose between these two regimes when paying taxes.

In addition to the above, there is a reduction in surcharge on the rate of the highest tax rate in the country of 42.74%, which is the highest in the world, from 37% to 25%. With this reduction, the maximum rate would be 39%.

The Finance Minister has also proposed to extend the benefit of standard deductions to the new tax regime. Each salaried person with an income of ₹15.5 lakhs or more will thus benefit by ₹ 50,000.

Under the old tax regime, these are some of the income tax deductions that you can claim:
  • Standard deductions
  • HRA and Leave Travel Allowance
  • Interest on Home loans
  • Medical Insurance Premium
  • Interest on Education loan
The new tax regime is different in two aspects:
  • The government has reduced the income slabs accompanied by lower tax rates.
  • All tax exemptions and deductions claimed under the old regime will not be available under the new regime.

The advantage here is that the taxpayer has the liberty to decide where and how to save/invest their money. This means you no longer have to rush to tax-saving schemes or investments that may not be in line with your financial needs.

PAN is to be used as a common identifier!

The Finance Minister has announced that the Permanent Account Number (PAN) will be used as common identifier for all digital systems of specified government agencies. PAN is the 10-digit alphanumeric number allotted by the Income-tax Department to a person, firm, or entity. This move would assist in further promoting ease of doing business in the country.

KYC process to be simplified

The Finance Minister has announced that a system of unified filing process will be set up to enable agencies to get all data from a common portal as per the choice of those filing returns.

For individuals Digilocker and Aadhar will serve as a “foundational identity” and with this facility changes in address or identity will be reflected across other platforms. This means that the government is working to synchronize citizens’ data across multiple portals when just Aadhar is updated. As of now when you update your Aadhar it does not update the changes say in the Income Tax portal. This is now set to change.

The Digital India program by the Government of India has introduced the Digilocker initiative where citizens can get authentic documents/certificates in digital format from the original issuers of these certificates. The aim is to eliminate or minimize the use of physical documents to enhance the effectiveness of service delivery paving the way for hassle-free and friendly service to the citizens.

Conclusion

These announcements made in the Union Budget 2023 will benefit the salaried employees and leave more disposable income in the hands of individuals thus enabling higher investments. We at GetifyHR are fully prepared to handle these changes and support our clients in seamlessly running their statutory compliance requirements and keeping them fully compliant always.