Karnataka To Recover Job Incentives From Msmes For Early Employee Termination

(MENAFN- KNN India) Bengaluru, Sep 30 (KNN) Karnataka has introduced penalties for micro, small and medium enterprises (MSMEs) that terminate employees within three months of receiving job-creation incentives under the Udyoga Nidhi scheme, according to a government order.

Under the scheme, eligible MSMEs will receive a monthly incentive of Rs 2,500 per job for two years for creating employment in 11 identified backward districts.

The government estimates an expenditure of around Rs 300 crore and aims to support the creation of one lakh jobs, reported Deccan Herald.

Recovery Provision For Early Termination

If an enterprise terminates an employee within three months of receiving the incentive, the government can recover the amount paid along with interest.

The provision will also apply where an MSME is found to have falsely reported job creation, with further action possible under applicable rules.

The scheme covers Yadgir, Bidar, Raichur, Kalaburagi, Koppal, Vijayanagar, Belagavi, Gadag, Haveri, Vijayapura and Bagalkot, identified based on recommendations of the Karnataka Regional Imbalances Redressal Committee headed by economist M Govinda Rao.

Physical Verification To Check Eligibility

A district-level implementation committee (DLIC), headed by the deputy commissioner, will physically verify at least 10 per cent of eligible MSMEs before releasing incentives. A further 10 per cent of beneficiaries will be verified before the third instalment.

Workers Must Meet Eligibility Conditions

To qualify, recruited workers must be residents of one of the 11 districts and provide a residence certificate, Aadhaar or Electoral Photo Identity Card (EPIC). Employees must be aged 18-45 years and maintain full monthly attendance.

MSMEs cannot claim another incentive, including benefits under the National Apprenticeship Promotion Scheme (NAPS), for the same employee.

The government will establish an Udyoga Nidhi portal for MSME registrations and incentive claims. A state-level committee headed by the Principal Secretary of the Commerce and Industries Department will oversee implementation.

(KNN Bureau)

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