Gujarat Labor Welfare Fund Act

Gujarat Labor Welfare Fund Act

Deskera Content Team
Deskera Content Team
Table of Contents
Table of Contents

Ran Kirpal is a laborer who works in Ahmedabad. He moved from another state and wanted to know all about the facilities he would get in his area of work. His main concerns were clean drinking water and a well-sanitized workplace. He went to his contractor to enquire about the same. He came to know about the Gujarat Labor Welfare Fund Act and so he was assured that he is entitled to basic amenities at his workplace. Let us find out what this law is all about.

Labor welfare is all about supplying amenities and facilities to workers to enhance their standard of living, and working conditions, and provide social security. There have been several laws, legislatures, and Acts based on providing the right working culture to employees, but a law that focuses solely on the welfare of workers is known as the Labor Welfare Fund Act.

Table of Contents

What is the Labor Welfare Fund?

The Labor Welfare Fund is a fund funded by employers, workers, and in some states, the government. Every state has its own Labor welfare fund based on certain conditions of the respective state and area. Individual Labor Welfare Fund Acts and Labor Welfare Fund Regulations have been enacted for various states and Union Territories. The key objective of the Gujarat Labor Welfare Fund Act is to provide housing, medical, educational, and recreational facilities for workers and their dependents.

How does the Labor Welfare Fund help workers?

The Labor Welfare Fund (LWF) is managed by the Labor Department, which offers a variety of welfare programs to workers. The program provides support in three broad areas:

1. Improving living standards

The Gujarat Labor Welfare Fund Act aims to provide balanced, healthy, and nutritious meals, education, and scholarships to employees' children. It further ensures the provision of medical facilities for private and public sector employees and their families and preferential and priced housing facilities

2. Better Working conditions

The act focuses on providing facilities such as commuting (transportation) to workers and employees, reading rooms, libraries, vocational training offers, excursions, guided tours, leisure facilities at work, etc.

3. Social Security

The act aims at providing social security through medical care, regulation of specific sectors, and side jobs or subsidiary employment to women and the unemployed.

Employers in each state determine the rate, amount, and tenure of contributions made by the workers which can be made monthly, semi-annually (semi-annual), or annually (annual) at the prescribed amount and remitted to the relevant vocational welfare fund in the prescribed form by the due date stipulated by law.

States incorporating the Labor Welfare Fund

Currently, the labor welfare fund act is applicable in the following states.

  • Andhra Pradesh
  • Chandigarh
  • Chhattisgarh
  • Delhi
  • Goa
  • Gujarat
  • Haryana
  • Karnataka
  • Kerala
  • Madhya Pradesh
  • Maharashtra
  • Orissa
  • Punjab
  • Tamil Nadu
  • Telangana
  • West Bengal

Benefits of the Labor Welfare Fund for Employers

Besides providing basic amenities to the workers, the labor welfare fund act is quite beneficial to the employers as well:

  • It provides sophisticated work relationships and improved work efficiency
  • It helps in improving the morale and mental and moral health of the workers
  • It creates a better outlook for employers

Gujarat Labor Welfare Fund Act - About Gujarat

Gujarat is the fifth largest state of India in terms of the area and the ninth largest state in terms of population, situated on the west coast of India with a population of 60.4 million. Its capital is Gandhinagar and the largest city is Ahmedabad. Gujarati Indians are native to India and their language, Gujarati, is the official language of the state.

Gujarat Labor Welfare Fund Act follows the rules of the Bombay Labor Welfare Fund. The Gujarat Labor Welfare Fund Act aims to accumulate a fund that helps in financing activities that lead to the enhancement and promotion of holistic welfare of labor in Gujarat and for certain other purposes.

Here is the contribution rule that is followed by the Gujarat Labor Welfare Fund Act


Half Yearly

Date Of Deduction

30 June and 31 December


15 July and 15 January





₹ 6

₹ 12

₹ 18

Guidelines of Gujarat Labor Welfare Fund Act

  • This act is valid only for establishments/employers that employ 10 or more people
  • Includes all employees barring those who are in the top managerial positions of the organization, who earn more than Rs. 3,500 per month
  • Gujarat Labor Welfare Fund Act (Labor Welfare Fund (Gujarat) Rules, 1962) has been amended and notified by the Labor Department of Gujarat which is the removal of removes the provisions of Section 3-AA (1)(a) and Form 'A' in the Appendix from the Rules

Section 3-AA (1)(a) was about:

  • 3AA - Storage of Registers, etc. by Employers
  • (1) Each employer at a business establishment must keep and maintain the registers for 10 years
  • (a) Wage Ledger Form “A” with an exception of the employer maintaining a muster roll-cum Wages register under the Payment of Wages Act, 1936 and the rules made then under

Gujarat Labor Welfare Fund Act - Rules and regulations (plus Amendments) for Workers followed in Gujarat

Certain Amendments

1. Leave rules of Gujarat

This is a snapshot of various holiday rules based on the Gujarat Shop & Establishment Act.




Annual / Privileged / Earned Leave (AL/PL/EL)

21 days

for every 240 days worked

5 days

for every 60 days worked

Casual Leave (CL)

7 days

Sick Leave (SL)

7 days

Maximum AL/PL that can be carried forward

63 Days

Working hours in a day


Total hours in a week


Rest Interval

Commercial Establishments: 30 minutes // Others: 1 hour

Commercial Establishments: Rest after 5 hours of work for at least 30 minutes // Mfg. the processor in any other case at least 1 hour

2. Profession Tax Schedule for Specific Individual Groups

The Gujarat Ministry of Finance schedules to revise the Schedule for Levy and Charge of Profession, Trade, Calling or Employment Tax effective from 01 April 2022. This replaces the previous schedule (Notification No. (GHN-11)-PFT-2008-S.3(2)(4)-TH dated April 1, 2008) as specified under the Gujarat professional Tax.

3. Gujarat Minimum Wage Dearness Allowance

The Government of Gujarat has issued a Notice of Minimum Wage Dearness Allowance effective April 1, 2022.

4. New Licenses to be issued for new factories and state manufacturers

As notified by the Gujarat Department of Labor Skill Development and Employment, there will be acceptance of applications for renewal of new licenses to the state manufacturers registered under the Factories Act along with the application for NOC under the Gujarat Fire Prevention and Safety Measures Act, 2013.

Gujarat Minimum Wages Notice

The Gujarat labor department has issued a notice regarding the revision of the minimum wage rate related to shipbreaking workers hired for skilled, semi-skilled, and unskilled workers as specified under the Gujarat Minimum Wages Rules, 1961.

Amendment to the minimum wage paid to workers

The revision of the minimum wage paid to workers will be according to the type of piece of work set about the class of workers.

As per the Gujarat Minimum Wage Rule, 1961

Before The Bombay Labor Welfare Fund Act, of 1953 was adopted in Gujarat, Labor welfare activities were carried out by the state government. However, it is recognized that the government's direct efforts to elevate the culture of the working class can only be limited in scope.

Specifics about the Gujarat Labor Welfare Fund Act

Labor Welfare is about providing money and necessities to people in need and the Gujarat Labor Welfare Fund Act covers the various services, benefits, and facilities that employers provide to their employees. Such facilities are provided through contributions made by the employers and employees

The Gujarat Labor Welfare Fund Act is run by the Ministry of Labor of the Government of India to provide basic facilities and social security to unorganized workers after deducting a certain amount from the worker's and employers' wages.


The Gujarat Labor Welfare Fund Act, 1953


The Labor Welfare Fund (Gujarat) Rules, 1962


Any Employer/Establishment employing ten or more employees/persons


Half Yearly




Gujarat Labor Welfare Fund Act - Some Welfare schemes For Gujarat Labor Welfare Board

  • Mobile Medical Van Scheme
  • Educational Award Scheme
  • Higher Education Reward Scheme
  • Shramyogi Pravasan Yojana
  • Female Shramyogi marriage benefit scheme
  • Female Labor Vehicle Subsidy Scheme
  • Maternity Aid- Benefit And Beti Bachao Scheme
  • Labor Accident benefit scheme
  • Labor’s Disabled Child Benefit Scheme
  • Swachchh Bhaarat -PUBLIC Toilet Facility For Labor Scheme
  • Home town scheme
  • Training For Competitive Exam Scheme
  • Shramyogi Cycle Subsidy Scheme
  • Labor Awareness Program Scheme-
  • Development Of New Labor Welfare Center
  • Shishu Vihar Ane Ganvesh Yojna
  • Special Events/Sports Tournaments Grant Scheme
  • Traditional/ Cultural Program Grant Scheme
  • Yog Center
  • Home Loan Interest subsidy scheme
  • Full Body Checkup scheme
  • Labors Child Encouragement Award Scheme

Gujarat Labor Welfare Fund Act – List of Contributions to be made by the employee and the employer

Labor Welfare Fund Contribution


Employee Contribution

Employer Contribution

Total Contribution

Date of Deduction

Last Date For Submission

All employees who earn more than Rs. 3500 barring those who are working in managerial or supervisory positions




30th June

15th July

All employees who earn more than Rs. 3500 barring those who are working in managerial or supervisory positions




31st December

15th Jan

Gujarat Labor Welfare Fund Act – Form A-1


[Rule 3B]

Statement of employees’ and employer’s contribution on 30th June and 31st December, respectively

  1. Name of the establishment.
  2. Name of the employer.
  3. Class of establishment (i.e., whether a factory or a motor omnibus service a shop, commercial establishment, residential hotel, restaurant, eating house, theatre, or another place of public amusement or entrainment.
  4. Address of the establishment
  5. Total number of employees whose names stand on the establishment register on 30th June/31st
  • Employee’s contribution is payable at the rate of ……….

Per employee in terms of entry No.5                   ………….Rs………..

  • Employer’s contribution is payable at the rate of …………

Per employee in terms of entry No.5                   ………….Rs………..

  • Contribution already paid to the Welfare Commissioner.
  • Employees of                  Amount Rs.

Contribution    Employees

  • Employer’s contribution
  • Date of payment.
  • Mode of payment.

(i.e. cash/Money-order/Cheque/Demand Draft)

  1. In case of non-payment or less payment of contribution the reason thereof-

Date:                                                                                       Signature of Employer

Gujarat Labor Welfare Fund Act – Activities

  • Human development activities for the employees
  • For children education of workers aged 2.5 to 5 on a Montessorian basis
  • For women - Providing training in sewing, embroidery, and stitching to dependent female workers
  • For Laborers - provision of training courses, sports, and reading rooms, especially for the unemployed dependents who are self-employed or are working in home industries

Gujarat Labor Welfare Fund Act – Conclusion

This act reflects the government's progressive attitude towards workers and the government's desire to take steps to uplift workers and formulate progressive Labor policies. Before the adoption of the Bombay Labor Welfare Fund Act of 1953, Labor welfare activities were run by the Gujarat state government. The Gujarat Labor Welfare Fund Act came into effect to bring light and joy to workers' lives exercised on a broader and more comprehensive scale by workers' organizations, employers, and local governments, either directly or through appropriate institutions.

True progress is ultimately a matter of inner effort brought about by people's qualities and the ability to struggle and sacrifice, and all kinds of national interventions and legally imposed processes are merely an aid, in themselves.

Even the employer benefits from such measures and will also bear the burden on the employee. Therefore, the Gujarat Labor Welfare Fund Act came into effect to carry out Labor welfare activities.

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Key Takeaways

  • The Bombay Labor Welfare Fund Act 1953 was established in Bombay under Rule 4 and the Bombay Labor Welfare Fund Act 1953 was established in 1960 under Rule 47 of Gujarat in 1961
  • The Gujarat Labor Welfare Fund Act is one of the most important steps, as its activities benefit not only workers but also their families and loved ones. Therefore, Gujarat workers are fortunate to have legal access to such measures through statutory bodies
  • The Bombay Labor Welfare Fund Act 1953 was passed by the Bombay Government at the time and came into effect on June 24, 1953. It was enforced only in six cities in the Gujarat region, which was then in Bombay State. The purpose of this law is to provide for the establishment of a fund to promote the welfare of workers in Gujarat and to fund activities to carry out such welfare activities
  • After the establishment of Gujarat, certain changes were made in the light of the Supreme Court's ruling, and the amendment law - Gujarat Labor Welfare Fund Act, came into force in the above six cities and other parts of the state in 1962
  • The Gujarat Labor Welfare Fund Act, a statutory body established under the Bombay Labor Welfare Fund Act of 1953 (expanded throughout Gujarat from October 1962), has given industrial workers employed by factories and their dependents
  • The board of directors, of the Gujarat Labor Welfare Fund Act, is appointed by the state government and comprises employers, employees, independent members, and representatives of women's representatives. The board has 14 members
  • The term of office of directors is three years. There is a president elected from among independent members. The main function of the board is to develop policies implemented by welfare officers
  • The Gujarat Labor Welfare Fund Act ensures basic facilities are provided to the employees
  • Contributions are made both by the employee and the employer towards the Gujarat Labor Welfare Fund Act
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