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 Labour Welfare Fund

Purpose

This component computes the contribution towards Labour Welfare Fund (LWF).

LWF is a statutory contribution. The state authorities determine the rate of contribution and frequency of contribution towards LWF.

Features

  • Other Statutory Deductions infotype (0588), LWF (Labour Welfare Fund) subtype (0002)

    In this infotype, you select the eligibility of an employee towards LWF such as the LWF frequency, LWF computation rates and the Validity date.

  • Labour Welfare Fund legal reports (HINCLWFI)

    Using this report you can generate the LWF form for submission to the authorities. The SAP system generates the LWF statements in the format prescribed by the concerned state authority.

  • LWF Computations

    The states specify their individual rates for LWF computation, the frequency of LWF contribution and Validity Date for LWF contributions.

    For example, the LWF contribution frequency in Tamil Nadu is annual and it takes place in the ninth period. The validity date for Tamil Nadu is 31 st December. In Kerala, the deduction frequency is bi-annual, and it takes place in the third period and the ninth period. The third period has the validity date as 30 th June.

    You can configure details through theIMGunder Start of the navigation path Payroll India Next navigation step Statutory Social Contribution Next navigation step Labour Welfare Fund End of the navigation path .

  • Termination

    The method of computing LWF in case of a termination differs from one state to another. The individual states also specify the method of computing LWF contributions, in case of a termination.

    For example, if an employee in Kerala leaves the organization before 30 th June, the system will not compute the LWF contribution for the employee. In the case of Tamil Nadu however, the system will compute the LWF contribution even if the employee leaves before the 31 st December.

  • Retrospective LWF calculations

    A retrospective change in Other Statutory Deductions infotype (0588), LWF (Labour Welfare Fund) subtype 0002 does not result in retroactive LWF calculations.

  • User Exit

    In the Standard SAP system, you can define the Labour Welfare Groups for the employees based on their default Personnel Area and Personnel Subarea .

    If you wish to override the default LWF Personnel Subarea grouping, you can do so through a customer exit.

    For more information, see theIMGunder Start of the navigation path Payroll India Next navigation step Statutory Social Contribution Next navigation step Labour Welfare Fund Next navigation step User Exit: Determine Personnel SubArea Grp forESIand LWF End of the navigation path .