In a major push to formal employment, the government will implement the Employment Linked Incentive (ELI) Scheme from August 1, 2025. This scheme is designed to benefit first-time job holders in the organized sector by offering a ₹15,000 incentive, while employers will also receive financial support for hiring fresh talent.
Let’s break down who qualifies, how it works, and what to watch out for.
🔍 What Is the ELI Scheme?The Employment Linked Incentive (ELI) Scheme aims to encourage both job seekers and employers in the formal sector. Here's how it works:
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₹15,000 incentive will be given to employees joining their first formal job.
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The amount will be paid in two installments:
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First installment after completing 6 months of continuous employment.
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Second installment after completing 12 months.
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Must be joining their first job in the organized sector.
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Should not switch jobs before completing 12 months to receive the full amount.
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Must earn up to ₹1,00,000/month (clarification awaited on whether this is CTC or net salary).
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Required to pass a financial literacy test.
💼 What Do Employers Get?⚠️ If you leave your job before 12 months or take a second job, you may lose the second installment or even 50% of the benefit.
To incentivize recruitment, companies hiring fresh employees under the ELI scheme will get:
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Up to ₹3,000/month per new hire as an incentive.
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This support will be provided for up to 2 years per eligible employee.
However:
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The employee must stay for at least 6 months for any benefit to be granted to the employer.
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If the employee quits early, the employer may lose the incentive too.
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The first ₹7,500 (out of ₹15,000) is released after 6 months of employment.
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The remaining ₹7,500 is given after completing 12 months.
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The scheme strictly applies to the first job only. Switching to another job within a year disqualifies you from receiving the second installment.
Experts believe the ELI scheme is a significant step toward employment stability and aims to strengthen job creation in the formal sector. If implemented effectively, it could:
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Encourage youth to join and remain in their first jobs longer.
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Reduce early attrition.
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Support companies with reduced onboarding costs.
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Promote long-term employment over gig or unstable work.
The ELI Scheme is a win-win for both employers and employees — but only if all conditions are followed carefully.
₹15,000 incentive (in 2 parts) | ₹3,000/month per new hire (up to 2 yrs) |
Must stay 12 months to get full benefit | Incentive only if employee stays 6+ months |
First formal job only | Encourages fresh hiring |
Must pass a financial literacy test | Adds value to skilled recruitment |
If you’re starting your career or hiring freshers — August 1 onwards, this scheme could be the start of a financially smart and stable journey.
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