What is LWF?
LWF is a state-specific Labour Welfare Fund contribution used for worker welfare schemes. Employee and employer each pay a small fixed amount.
LWF stands for Labour Welfare Fund. It is a state-level contribution collected from employees and employers to fund welfare schemes for workers. The amount, frequency and deduction months depend entirely on the state where the employee works. States like Maharashtra, Karnataka, Tamil Nadu, Gujarat, West Bengal, Andhra Pradesh and Telangana have an active LWF levy, while states like Delhi, Uttar Pradesh, Rajasthan and Haryana do not.
The contribution is usually a small fixed amount. For example, in Karnataka the employee pays ₹20 and the employer pays ₹40 once a year, deducted in December. In Maharashtra, the contribution is half-yearly in June and December; the employee pays ₹6 or ₹12 and the employer pays ₹18 or ₹36 depending on whether monthly gross is up to or above ₹3,000. The money is used for housing, education, medical and other welfare activities for workers and their families.
Employers must register with the state's Labour Welfare Fund board and file returns as per the state schedule. Missing a payment can lead to penalties and interest.
Worked example
A company in Maharashtra has 20 employees, all with monthly gross above ₹3,000. The LWF is deducted in June and December.
| Component | Amount per employee | Half-yearly total (20 employees) | |---|---|---| | Employee share | ₹12 | ₹240 | | Employer share | ₹36 | ₹720 | | Total per half-year | ₹48 | ₹960 |
The employer deposits ₹960 every June and December with the Maharashtra Labour Welfare Fund.
Related reading
Use the professional tax calculator to check other state-level deductions, or read the statutory deductions guide.
Frequently asked questions
- Is LWF applicable in every state?
- No. It applies only in states that have enacted a Labour Welfare Fund Act, such as Maharashtra, Karnataka, Tamil Nadu and Gujarat.
- How often is LWF deducted?
- It can be annual, half-yearly or monthly depending on the state. Many states deduct once or twice a year.
- Is LWF based on salary?
- In most states it is a fixed amount per employee, not a percentage of salary, though a few states use gross salary bands.