Jan 2017 update: The ESI wage ceiling has been enhanced to Rs 21,000 with effect from 01-Jan-2017, please take a look at our blog post here.
Payroll managers are aware that the existing wage limit (as of Nov 2013) for coverage under the ESI Act is Rs 15,000 (Rupees Fifteen Thousand) per month. Also, that once the ESI contribution begins, the contribution should continue until the end of the contribution period (Apr to Sep or Oct to Mar) even if the salary (for the purpose of ESI calculation) increases beyond Rs 15,000 per month during the contribution period.
One of our customers asked us the following question in this regard.
In case the salary goes above Rs 15,000, say to Rs 17,000, during the contribution period, should we calculate ESI on the actual salary (Rs 17,000) or should the salary be restricted to Rs 15,000 for ESI calculation?
Many payroll managers mistakenly believe that salary, when it goes above Rs 15,000 during the contribution period, should be restricted to Rs 15,000 for the purpose of ESI calculation. The logic is that since salary for ESI coverage limit is Rs 15,000 per month, there is no need to calculate ESI on any amount above Rs 15,000. We find many payroll managers being incorrectly informed on this.
The ESI department has adequately clarified that during the contribution period ESI should be calculated on total ESI salary and the salary should not be restricted to Rs 15,000 in case the salary goes above Rs 15,000. In other words, if the total ESI salary is Rs 17,000, ESI deduction and contribution should be calculated on Rs 17,000 and not on Rs 15,000. Payroll managers should note that employees get additional benefits on the ESI amount calculated on salary above Rs 15,000.
In one of its publications, the ESI department has cleared the air on this issue.
An employee whose wages crosses the prescribed ceiling limit in any month at anytime after commencement of the contribution period, continue to be an employee till the end of that contribution period. Though there is a wage ceiling limit for coverage of an employee, there is no ceiling limit in the definition of wages for payment of contribution. Hence contribution is payable on the total wages without any ceiling limit.
Payroll managers would do well to follow the ESI department’s directive in this regard.
392 Comments
Gautam Ji,
What is the existing ceiling wage limit for coverage under ESI Act ( at present) ?
One news paper economic times reported on 23 November 2013 as-
NEW DELHI: Employees with a salary entailing a monthly cost to company or CTC of up to Rs 30,000 may be faced with a cut in take-home pay, following a government decision to enhance the ceiling for mandatory health insurance coverage through the Employees’ State Insurance Corporation (ESIC).
Employers will have to deduct 6.5% of workers’ earning up to Rs 25,000 in gross salary towards ESIC, up from the earlier ceiling of Rs 15,000 that was set in 2010. A decision to raise the salary ceiling was taken at a meeting of the corporation chaired by labour and employment minister Sis Ram Ola last Thursday.
Experts said the raised ESIC ceiling will hit the take-home income components of those earning over Rs 15,000 per month and up to Rs 30,000 per month on a CTC basis. The corporation, which covers around 1.5 crore employees, reckons that the move will bring nearly 45 lakh new workers within its fold, while boosting annual revenue through statutory contributions by Rs 4,200 crore.
The ESIC Act of 1948 was the first social security legislation of independent India and offers medical care to workers and their dependents along with unemployment benefits in case of disablement or occupational accidents, including fatal ones. It mandates employers to contribute 4.75% of an employees’ gross salary with a 1.75% matching premium payment from employees. In return, members get access to ESIC’s dispensaries and hospitals around the country.
“Since ESIC contributions are linked to gross salary, a lot of younger people in new-age jobs like BPOs and IT services would be drawn into its fold under the new ceiling,” said Rituparna Chakraborty, senior vice president and cofounder of TeamLease Services. “This is bizarre since the law was aimed at protecting the weakest industrial workers, not those who can afford to buy their own healthcare insurance.”
While the government cited a rise in wages and high inflation in the period since 2010 as the reason for raising the ceiling, employer representatives attending the ESIC meeting submitted a dissent note on the decision. When the idea was originally mooted in June 2012, employers had stressed that the revision in the ceiling must not be considered in isolation.
But website of ESIC is not providing as such information. In CSJM University there are many employee who are getting between rs 15,00 to rs 25,000 but are getting ESIC facility.
Sir I shall be highly obliged to you for you kind guidance.
Thanks
Anil
0939225887
As of now (08-Feb-2014), the wage ceiling is Rs 15,000 per month. Whatever is reported in the press will come into force only after the Government Order (G.O) is issued. We need to wait for the G.O.
Hi, Gautam….If my total ctc is 15000 then ESIC deduction is mandatory as per govn rule. If I don’t want it,then what will be the procedure. Kindly suggest.
You cannot opt out of ESI if your salary is Rs 15,000.
under which section it will come
Please take a look at the ESI website.
Dear sir
I have a doubt on my GMC till my last year I was covered under GMC not ESI as my salary was 19000 but now from JAN they say my GMC would be cancelled and ESI would be activated
Can I use both GMC and ESI or should use only ESI
Is any thing I can fight with the company that I wanted my GMC can I
Regards
Vinod
I presume GMC means group medical insurance.
ESI is mandatory whether or not you are under GMC.
hello sir,
My gross salary were 18533/- & after effect of new ESIC act it has gone below to 17693/-. its affect on my take home which has deducted by 840 ( excluding ESIC deduction from net salary 310/- ) total affected by 1150 P.M
so i have found that Company share of 4.75% has been deducted from my Gross salary. Is it legal???
Does your offer letter state that the employer share of ESI will be deducted from your salary?
Hi, Gautam….If my total ctc is 15000 then ESIC deduction is mandatory as per govn rule. If I don’t want it,then what will be the procedure.
You have to be covered under ESI. There is no way to opt out until your monthly salary exceeds Rs 21,000.
Dear gautham Sir,
last September onwards I am included in ESI scheme. Recently I got a appraisal in monthly salary . So my monthly cross salary increased to Rs 21500/- . I have a GMC also so I don’t want ESI but our employer deducted in my salary still. what is the rule and how I exempt from this.
Pls advice me Thanks in Advance
If your salary went above Rs 21,000 per month in March, there should be no ESI deduction for you from Apr onwards.
my basic salary is 14000+DA 1500 total salary 15500 whether iam eligible for getting esic benefit
No, you are not eligible.
my basic salary is 14000+DA 1500 total salary 15500 whether iam eligible for getting esic benefit
reply
Your are not eligible currently since the limit is Rs 15,000.
Dear Sir,
Pl advice I had regined my current co for my personal region. I had left this job on 10-05.2014 and Now I regoing here on Dt. 01.06.2014. so pl advice what limited of ESI & Mow My Gross Salary is 17000/- Approx.
Can I ignore Esi deduction pl advice.
Regards
Amit
If your ESI wages are above Rs 15,000 per month, there will be no ESI deduction from your salary.
I don’t Understand That How To Get My ESIC Benefit At The Time Of Pregnency. Plz. Reply Me
Kindly check with your HR team in this regard.
Suppose Employee salary revised w.e.f 1st Apr 2014 from 14000/- to 16000/- per month. But this revision incorporated in June 2014 Salary but effective date is from 1st April 2014. In this case do we need to continue ESI deduction till Aug14
If you had ESI deduction in April and May 14, you have to continue with it until Sep 14, even if there is a pay hike effective Apr 14 in June 14.
My ctc is 15000 is need to deduct esi
If your wages (for the purpose of ESI calculation) is less than or equal to Rs. 15,000 per month, there ought to be an ESI deduction from your salary. Of course, I assume that your organization is large enough and registered with the ESI department.
Hi,
Thanks for the info you shared with all of us. Its very useful for all of us.
Keep posting the updates…..
Thank You,
regards,
Raju.K
my basic salary is 5677 rs and gross is 12500. will esi deduct or not.
Since your monthly salary is within the ESI wage ceiling, there should be ESI deduction on your salary.
who many employes i want to get the esi faccilites
I am unable to understand your question. Please elaborate.
Dear Sir,
For exemption of ESI deduction from the employee, whether contribution of overtime to be includes or not,
Kindly give the details for ESI exemption of employee’s salary components.
Thanks.
Dear Sir,
Kindly inform us whether the ESI deduction exemption is inclusive of overtime or not, Please provide us the detail of salary component to be considered for exemption.
Regards.
According to the ESI department, the ESI contribution is payable on overtime. However, overtime allowances will be considered as wage for the purpose of charging the contribution only and will not be considered for the purpose of the coverage of the employee under ESI.
Hi,
I need a clarification on till how much billing amount is the ESI will cover up? 🙂
(Sorry about the terminology, as I am unaware of the Insurance thing)
Thanks in advance.
Are you asking about the insurance cover which is provided by ESI?
if the gross crosses 15000 from April 1st or September 1st , is it necessary to deduct ESI?
No need to deduct ESI. But if the ESI wages cross Rs 15,000 per month during the half-year, the ESI deduction should continue until the end of the half year.
Dear Sir,
Good Morning, Can you tell me about what is the esi deduction new rule?
There has been no recent change in rules related to ESI deduction.
dear sir,
I need a clarity regarding ESIC deduction.
I had joined a company on dated August 2013 with in hand salary 13000,now my salary is revised on September 2014 and my current in hand salary is above 16000. In this case do i need to continue ESI deduction???
if yes then plz clarify me upto when?????
You will be under ESI as long as your ESI wage is less than or equal to Rs 15,000. If at the beginning of an ESI period (Apr or Oct) your ESI wage goes above Rs 15,000, you will be out of ESI.
Please note that the ESI calculation is on the gross pay and not on the on-hand salary (net pay).
Dear Sir,
My ctc is 14000 , but along with over time my salary is 16000. for few month. so will i get esi?
You will be under ESI as long as your ESI wage is less than or equal to Rs 15,000. If at the beginning of an ESI period (Apr or Oct) your ESI wage goes above Rs 15,000, you will be out of ESI.
Hi,
If an employee who has been drawing a salary of Rs. 17000/- per month, goes on leave without wages and because of this the gross salary for the month is reduced below Rs. 15000/- , then is the ESI to be deducted ?
No.
Dear Sir,
After the deduction (1.75%) of ESI from employee side, employer is mistakenly not paid (4.75%) their contribution, how that payment can be done later and is there any penalty for that delayed payment.
(In other words, after the deduction of esi of an employee, mistakenly employer left that employee from the list, how can it be rectified properly)
Kindly guide me.
I understand you didn’t make the contribution in full and created a challan for only a part of the contribution in a particular ESI month. You can create another challan for the remaining amount and make the payment. You will receive a notice for interest on late remittance from the department at some point in time.
MY SAL IS 16200 SO CAN U TEL ME M I LIABLE TO GET ESIC & HOW MUCH & HOW
If your ESI salary is more than Rs 15,000 per month at the beginning of an ESI period, you will not come under the ESI net.
Dear Sir,
my Gross Salary is rs.17680.00. In pay slip basic salary shows 7200.00. Can you tell me my basic is right or wrong or any rules against basic salary ?
thanks
sunil
There is no rule which specifies what percentage of gross the Basic pay should be.
Dear Sir,
What do you mean by “Deputation Allowance” ? Our company Adecco C/o.Cipla ltd. is going to change “Other Allowance” to Deputation Allowance. Kindly understand me clearly.
thanks
Sunil mandal
Since the pay structure change has been effected by your organization, kindly check with them on the difference between “Other” and “Deputation” Allowance.
Sir,
I’m working outsourcing organisation, my salary crossed Rs.15,000/- and not deducting ESI Contribution. How should I get ESI benefits. Is there any scope of availing ESI benefits. Let me know whether crossing the wages Rs.15,000/-, there is no ESI benefits. Without ESI benefits, there is no Security to me and my family, I’m in Risk. Please help in this regard.
You cannot get ESI benefits if your ESI wage is above Rs 15,000 per month. If you are out of the ESI net, you could consider taking insurance policies from public or private sector insurance companies to cover hospitalization expenses.
Dear sir
pl.send the reply. I am also facing same problem. I have taken esic benefits 15 years.Now the ceiling changed. I am not getting esic benefit as well as management support. management was not issued health insurance policy so far. How to proceeed
Regards
prabhakar
09704111150
Once you are out of the ESI limits, you have to take an insurance on your own.
Hi Gautam,
My wife is earning 16000/- per month now and we want ESI usage critically, can we pay extra money to avail this scheme.
or Can you suggest any other option on using ESI Hospital.
Regards,
Sriram
If your wife is not contributing to ESI on account of her salary being more than Rs 15,000 per month, she will not be able to avail ESI facility.
Example: What if Actual Gross salary is say Rs 17000 but because if LWP the Earned Gross salary becomes Rs 14000. Will there be any deduction? Also will the contribution be continued till the end of contribution period. Thanks
No, there will be no deduction. The first thing is one needs to check is ESI eligibility. Then comes the actual deduction. In this case, the employee fails the ESI eligibility test on account of the salary. Consequently, there shall be no ESI deduction even if the salary drops below Rs 15,000 on account of LWP.
Hi,
As I had been drawing 14489rs gross salary, i was coming under ESIC net. But from Dec’2014 my salary has been revised to approx 16850rs gross. That means Professional tax will be deducted from now.
Please tell me whether professional tax be deducted along with ESIC (which is no more helpfull) and how long?
ESI and PT are 2 different deductions. Each has its own rules with regard to when and how much deduction should happen.
1. ESI – If your salary goes past the ESI limit in Dec 2014, your ESI deduction will continue until Mar 2015 (the end of the ESI period) and will stop from Apr 15 onwards.
2. Your PT deduction depends on your work location. If your salary is in a taxable PT slab as per the PT rules in your work location, your PT deduction will continue to happen even after your ESI deduction stops.
thanx…
What if the CTC is exactly 15,000 because I don’t have any idea about how much ESI is deducted from my basic salary (9,500). Can you exactly tell me how much ESI should be deducted based on my CTC or basic salary?
It is neither the CTC nor Basic. You need to take a look at all your heads of pay and check if each head of pay should be considered or not for calculating ESI eligibility – some heads of pay are explicitly exempted by the ESI Act. If you fall in the ESI net, your ESI should then be calculated.
If you can let us know the break-up of your CTC and the ESI amount deducted from your salary, we can tell you how ESI calculation is arrived at.
Please let me know whether ESIC is applicable on Annual Bonus to staff who is in Esic bracket.
Annual bonus paid to employees cannot be treated as wage for the purpose of charging of contribution under Sec 2(22), since the periodicity of the payment is more than 2 months. Hence, no contribution is payable on annual Bonus.
We started deducting ESI when we crossed 10 employees formula ( including two directors) from June 2014. But soon after three employees resigned the company. Should we continue paying ESI for rest of eligible employees ( 5 only) ? How we can stop ESI for 7 employee company ( including 2 directors) ?
Thanks in advance.
Once an organization is into the ESI category, it shall remain so even if the number of employees drops below 10. The ESI contribution and deduction should be continued with for all the eligible employees.
Hai,
I am sudheer, getting salary gross 15030/- net 14320/- , please confirm may i eligible for ESI, and confirm any new GO is coming that ESI eligibility limit to be increased to Rs 25,000 pm, please confirm…..
1. If the ESI gross is greater than Rs 15,000 per month, you will not be eligible for ESI.
2. As of now (Dec 2014), the wage limit for ESI eligibility is Rs 15,000 and not Rs 25,000 per month.
Hi sir,
My Gross salary for a month is INR 16555.00
My In Hand salary is INR 14009.00 after deduction of esic and PF (Third Party Payroll)
i want to know that
they are doing right or not ???
Reply me soon
thank you
We cannot answer this question without getting to know the breakup of your gross pay and the actual ESI and PF deduction amounts.
Dear Sir,
One of my friend asked me below query:
Gross Wages are 14,500 (excluding Incentives) hence coverable under ESIC
After adding incentives of 5,000 Gross Salary comes to 19,500/-.
On which amount the ESIC is to be deducted
1] 14,500
2] 15,000
3] 19,500
In simple words, can we limit the contributions upto 15,000/-. Is there any circular from ESIC Authorities clarifying the above doubts.
Warm Regards,
Datta S.
From the gross pay, one should look at the ESI applicability for each head of pay and calculate the ESI wages for the month. Please note that the gross pay and the ESI wages may not be the same since some of the heads of pay may have to be left out for the purpose of ESI wage calculation.
In order to answer your question, we need to arrive at the ESI wage first.
If the ESI wage is an amount greater than Rs 15,000, we need to calculate the contribution on the total ESI wage. In other words, we cannot restrict the ESI wage to Rs 15,000 for the purpose of contribution calculation.
Thanks for the clarity Gautham.
Regards,
Datta S.
hello sir,
what are the components comes under gross pay and the what needs to be leftout for ESI wages calculation..
Kindly check with the ESI department website in this regard.
Dear Sir,
On of our employee monthly salary is 12740/- if he does OT, he is getting around 18000/- per month. Most of the months he is getting the same. But since his basic amount of salary is 12740/- (with out OT) we are deducting the ESI and remitting to the department. Last 2 months he has not done the OT he got only the basic amount.
My question is that we have to deduct the ESI every month since it is beyond 15000, or not to deduct since some months are below 15000.
Please clarify
Thanking you.
Once ESI deduction starts at the beginning of a six-month period (in Apr or in Oct), the ESI deduction has to be continued with until the end of the six months (until Sep or Mar). Even if the monthly wage goes above Rs 15,000 in any of the months before the end of the 6 month period, the ESI deduction cannot be stopped during such months.
I have been paid 15500 per month, whether ESI deduction is applicable for me?
From the gross pay, one should look at the ESI applicability for each head of pay and calculate the ESI wages for the month. Please note that the gross pay and the ESI wages may not be the same since some of the heads of pay may have to be left out for the purpose of ESI wage calculation.
In order to answer your question, we need to arrive at the ESI wage first.
Basic 6000 employer Pf Chrgs 97 emp esi 263
CCA 1200 employer Pf 720 emp pf 720
Conv 800 Employer esi 713 Total (C) 983
DA 1542 insurance 33
HRA 3000 Total (B) 1563
MA 1250
MB A 1200
Total (A) 14992
Hi sir,
My Gross salary for a month is INR 16555.00 (A+B)
My In Hand salary is INR 14009.00 (A-C) after deduction of esic and PF (Third Party Payroll)
i am confuesd about ESI Deduction and want to know that they are doing right or not ???
Reply me soon
thank you
Unable to understand what your doubt regarding ESI calculation is.
Sir Iwant to know that if esic account get deactivated if not used for long time. Because today when I visited esic hospital they said it is deactivated. But esi. Deduction is continued from my salary. Now what should I do I need to take a urgent medical facility for my father.
Kindly check with the ESI department in this regard.
Hello sir,
My wages is 15006 but take home is 13500. Is there esi deduction for this?
We can answer this question only if we get to know the break-up of your gross pay.
All the employees of our Firm are covered by Health Insurance and Accident Policy. Should we still required to be registered under ESI Scheme
The ESI department does not recognize any insurance policy and expects employers to register with them.
All the employees of our Firm are covered by Health Insurance By New India Assurance and Accident Policy also from New India Assurance. Should we still required to be registered under ESI Scheme
The ESI department does not recognize any insurance policy and expects employers to register with them.
Hi goutham,
Whats the case in next contribution period(example for OCT-MAR) for an employee if gross earning of that employee goes above 15000 in current period of contribution(example APR-SEP) in any month?
Will he be able to get ESI deduction in next contribution period?
If the ESI wage goes above Rs 15,000 before the next contribution period, there will be no ESI deduction during the next contribution period. If the ESI wage goes above Rs 15,000 in the middle of the next contribution period, ESI deduction should continue until the end of the contribution period.
Hi Gautham
Can you tell me . I am working with a publication house my salary is 12000/pm .
Company pay me 15200 by cheque and the end they took back Rs.3200 from me why they do it . tell me plz .
Your organization should be able to give you the breakup of the deduction amount.
If such contribution happened in a mistake …Can we have another option but the option should not be of changing the ESIC number.
Is there a way to save the person in esic contribution in even next contribution period?
We are unable to understand your question. Please rephrase the same.
If such contribution happened in a mistake….Whether there is any possible way to safeguard the contribution of such employee in next contribution period?
You can simply stop contribution from the next contribution period onwards.
IF such contribution happened in a mistake…IS there any way to safeguard the contribution of such employee in next contribution period?
You can simply stop contribution from the next contribution period onwards.
But the problem is that i don’t want to stop the contribution for that employee even in next contribution period…so i asked whether there is a way to continue the contribution.
No, once an employee’s ESI wage goes above Rs 15,000 per month, he goes out of ESI. You cannot continue with the contribution.
Ya sir but the problem is that i want to continue my contribution with the same ESI number.Is there a Way to safeguard and continue the contribution?
No, once an employee’s ESI wage goes above Rs 15,000 per month, he goes out of ESI. You cannot continue with the contribution.
hi ,
my salary is above 15000 from 2014 April , but now it’s 2015. and the company deducted my ESI from 2014 April to till date . when I mailed they replied us, that we can’t stop in April wait for sep 15.
but they have deducted approx 5000 RS till now. and I am mail them for refund my deducted amount which wrongly done.
Not sure why your organization has deducting ESI from Apr 2014. Please request them to let you know the actual ESI wage on which they calculated ESI.
Sir
My now the salary limit for ESI eligibility is Rs,15000/.Sir if there any change in this limit in coming days. This 15000/- limit will efeect many employees. So increase in limit is very necessary.
As of now the limit is Rs 15,000 per month.
The salary limit for ESI purpose is Rs.15000/-.Sir if there will be any change in this limit.This limit should increase to Rs.25000/-.
As of now the limit is Rs 15,000 per month.
My CTC approx 14k.
During jan month my salary goes above 45k due to incentive earning.
But company deduct 1700 as esic. Calculte on my total earning. So whether my company doing right or wring?
We cannot answer this unless we get to know the salary break-up.
Hi sir.
my salary is 12000. company said 8854 is the net pay. how it will be. whether they doing right or wrong?
We cannot answer this question without getting to know the details of your heads of pay and deductions.
my salary per month Rs.16,500/- esic is applicable or not
If your ESI wage is above RS 15,000 per month, you are not eligible for ESI coverage.
Sir, Now I am working in a private college at Chennai. My college announced esi benefits for our staff’s only in the year of 2012, and also registered as a esi member in the year 2012. But they deduct esi contribution from December 2010 onwards. Now I paid esi amount till March 2015. Now My salary exceeding the esi limit (i.e. Rs.15,313/-). Suddenly the management stop our esi benefits. I contribute 4 1/2 years for esi. I also did not get any esi benefit from 2010 to 2012 (More than 2 years). Sir, I will to continue esi benefits. I heard that, a employee contribute more than 5 years to esi, they will pay a minimum rupees per year to esi, if he/she will not working. If my management deduct esi contribution more than 6 months for me, i also benefited. Have any chance to me for continue my esi any way? kindly help me.
If your ESI wage is above RS 15,000 per month, you are not eligible for ESI coverage. You need to consider taking an insurance coverage yourself. Some organizations take a medical insurance policy from insurance companies to cover their employees.
Dear Gautham,
Your blog is really helpful.
It would be more helpful if you can define wage components on which ESI contribution is calculated, in your blog itself, instead of redirecting to ESI website 🙂
Good suggestion. However, at times it is difficult to specify whether a pay head should be considered for ESI calculation unless we understand the nature of the head of pay. We find that head of pay titles can be misleading at times.
My Query Is Whether ESI Amount Calculated On His Gross Salary Or Gross Salary + Incentive Amount?
Is Monthly Incentive Amount Is A Part Of Salary?
We need to understand the nature (periodicity of payment etc.) of the head (Incentive Amount) before commenting on whether it should be considered for ESI calculation. Typically, variable heads of pay are not considered for ESI eligibility calculation but are included for ESI deduction calculation.
Thank u sir
Hi,
i have a small doubt that my salary was 14519 in march and ESI was deducted and my salary increased in april 2015 from Rs.14519 to Rs. 15971 pm and they stopped ESI amount deducting from salary.
1. Am i eligible to get check-up in ESI hospital ?
2. My wife is 6 month pregnant and we are consutling in private hospital so does she can admitted for delivery in ESI Hospital ?
and one of my HR said that if i have contributed till march 2015 then am eligible till next 6 months (we can do get OP Checkups and can admit in hospital for delivery).
but am not getting full clarity of this issue wether i can take my wife for delivery ESI Hospital ?
This is Copied from ESIC WEBSITE
Contribution Period and Benefit Period
There are two contribution periods each of six months duration and two corresponding benefit periods also of six months duration as under.
Contribution period Corresponding Cash Benefit period Contribution Period Cash Benefit Period
1st April to 30th Sept. 1st Jan of the following year to 30th June
1st Oct to 31st March of the year following. 1st July to 31st December.
Dear Sir,
My question is completely different, here it goes. when an employee comes out of esic, mean when the actual deduction stops. As both the ESIC contribution (Employee & employer) been included in CTC, whether company has to pay me the amount which is not deducting now (ESIC both 4.75% and 1.75%) or it have an option to not even pay me that amount which was deducting from my salary for esic.
If an amount is specified as part of CTC, it should be paid to you under some or other head.
Thanks you Soo Much For this. But my next question is, what if company doesn’t pay me. what can i do? any solution on this. which does not hamper my carrier.
Thanks,
Praveen Mesta
You can check with your company’s HR folks in this regard and seek an explanation from them.
Hello sir,
In our company’s salary structure, PF amount (employer contribution) is included in Gross salary , so while considering the limit of 15000 gross for ESIC deduction, do we need to consider Gross including PF amount or should be excluding PF amount. Please clarify
Please exclude Employer PF contribution while calculating gross wage for ESI calculation.
Helo Sir,
my salary is above 15000/- i m not getting ESI benefit.. but some other people working in other companies are getting esi benefit with higher salaries. can you pls explain me why is it so??
We will be able to answer this question only if we get to know the salary break-up of the ESI and non-ESI employees.
Anybody can tell me, if the net take home is Rs.22,000/- then what kind of allowances or deduction to be made instead of ESI…?
We are unable to understand your question. Can you please rephrase it?
I AM PAYING RS114 PER MONTH AS ESI FROM 16 MONTHS HOW MUCH BENIFIT WILL I GET.WHETHER I GET THE ESI AMOUNT OF PERIOD APRIL- SEPTEMBER 2015 OR WILL I GET THE AMOUNT SINCE FROM JOINING MONTH
The ESI deduction entitles you several insurance and medical treatment benefits. You can check the ESI department website or the ESI compliance manager in your company on this.
You will receive ESI benefits from the first month of your service as long as you are under the ESI cover.
Dear Sir,
My company is not having employees more than 10 people. Out of 9 person employed currently, 3 have salaries more than 15,000.00 per month.
Now thr ESIC, Indore has given me a notice stating to deposit an amount calculating standard wages from last 5 years.
1.Do i m liable to pay even when i don’t have employees less than 10.
2. Do i have to pay on all 9 employees or only for 6 employees whose salary are below Rs.15000.00.
3. What are the documents i will have to provide while presenting before them.
Please advise,
Thanks & regards
1. You are not liable to pay ESI if the total number of employees is less than 10. However, if at any point in time in the past, your employee strength was 10 or more, the ESI department can demand ESI payment from the period when your employee strength was 10 or more. This even if the current strength is less than 10 employees.
2. Once your organization is in the ESI net, you need to determine the number of employees who fall under the ESI bracket and deduct ESI only for such employees.
3. Please check with the ESI official in this regard.
Is salary for computaion of ESI include PF or not ? If gross salary including PF is Rs.15000/-, then will deduct ESI or not?
Employer PF is not to be included for the purpose of determining ESI wage.
Is ESI will be deducted less than 15k on gross or net salay or Total CTC?
ESI should be calculated on ESI wages for which certain heads are included and certain heads are excluded.
sir ur blog is very useful
thanks for this blog
Now my salary is 17,000 , I came to know that ESI limit has been increased to 25,000 .Is that true or not? What is the limit? I come under this or not?
The salary limit for ESI is Rs 15,000 per month as of now (August 2015). It has not been increased to Rs 25,000 per month.
Sir
Is salary limit for ESI of Rs.15000/- per month will increase? It is necessary for common people to increase the limit.
Thanking you
The govt of India has not made any announcement regarding the increase.
Sir I was working with an organisation for almost 3 years. there were always 12+employees but we never got any benefits or payslips. just a fixed in hand and incentives as and when they deemed fit.
i left the organisation a few months back after serving a week notice period which was a norm in our company although the company offer letter mentions a month. but the 1 week policy has always been followed.
i was told that my FNF would be done in a weeks time. i tried contacting my boss but i was rebuffed and told that since i hadnt served notice the company wasnt liable to pay me anything. also the incentives i had earned which were to the tune of 50+k would not be given as they had made a new rule that it would be paid in mid-year and employees leaving before that would not get anything. there is nothing in writing regarding this new rule. my offer letter mentions that incentives would be paid out quarterly, a practice that was never followed.
is there anything i can do now. any legal recourse u can suggest.
Kindly check with a labour lawyer in this regard.
Hi Gautham,
My monthly CTC is 12500 INR till June 2015, it is revised to 16900 INR from July 2015, as per your previous explanation i am excluded from the ESI deduction category, but my organization is deducting the ESI amount from July 2015 to till date. Can you clarify me why they are deducting? And when i will be excluded from the ESI deduction?
Regards
Prashanth
The ESI deduction follows a half-yearly cycle (Apr to Sep and Oct to Mar) for the purpose of determining the exclusion of an employee. If the ESI salary goes above Rs 15,000 per month in the middle of a half-year (July 2015 in your case), the deduction has to be continued with until the end of the half-year (until Sep 2015 in your case). The deduction shall stop from the start of the next half-year (Oct 2015 in your case).
Hi Gautham,
My organization is still deducting the ESI amount from my salary till date. I have no idea when i will be excluded from this ESI contribution category. Please clarify on this.
Once your ESI salary goes above Rs 15,000 your ESI deduction will stop from the nearest Apr or Oct salary. For example, if your ESI salary goes above Rs 15,000 in Jan 2016, your ESI deduction will happen until Mar 2016. From, Apr 2016, there will be no ESI.
now my salary is 15800,but in-hand salary 14300. Then esi continued or stop form oct-2015
The net salary does not matter. If your gross ESI salary is Rs 15,800 per month, the ESI deduction should be discontinued with from Oct 2015.
ESI will be cancelled automatic from Oct2015 or any process required for ESI cancelation by Employee or Employer
ESI will not be cancelled automatically. The employer will have to specify the fact by choosing the appropriate code in the ESI challan.
Dear Sir,
I have joined private limited company in New Delhi with a gross salary Rs.17000.00.
My company Does not given any Medical Facilities beacause i am on probation for 6 month, So i want to know if there is any provision of govt for this.
Kindly Provide me any details for this because i am working like a daily wages labour not in a company.
With best Regards,
Prabhas
No, there is no medical facility available under ESI if you are not under ESI.
Hello Sir,
As my gross salary increased above 15K in May 2015 and company stopped deducting my ESI. In July i suffered an arm injury and now i am completely fit.
My question is this if my ESI is stopped deducting in May (or possibly April), Can i still get medical claim for my arm injury. Please help me out.
Thanks a ton.
Please check with your organization on this.
Sir they are not sure about it. They said me that we have to check but we are not sure.
In my view if i paid for ESI till 2nd half contribution period then i will be qualified for contribution benefit period till october according to ESI document.
Please sir confirm this as it will be a great help for me.
Thanks a lot.
As long as your are under the ESI net, you can claim ESI benefit. Also, an employer cannot stop ESI deduction in the middle of a half-year ESI period. I do not understand why your employer stopped ESI deduction in May.
I have an urgent query.
I have got an job offer of Rs 3,96,000/- in New Delhi. (Yearly-> 336,000/- fixed + 60,000/- Variable).
My employer asked me whether i want to opt for PF or not. (Basic will be more then 15000)
My query is that if i opt for not taking PF option then will my employer detect advance monthly/yearly taxes or not on my gross monthly/early salary for the FY 2015-16. ?
I do not understand your question. PF deduction enables you to get tax benefit under Section 80C. Not sure what you mean by “advance monthly/yearly taxes”.
My Monthly salary is as follows:
Basic- 17150
HRA- 5300
Covn Allow – 1600
Medical – 1250
Mgmt Allow – 2700
Variable- 5000
PF – N/A
Total – 33000
Sir, I mean that if I am not opting for EPF as my basic is more then 15000/-.
so whether my employer deduct income tax on my gross monthly salary on every month or will deduct total tax on gross salary at the end of the FY 2015-16. As many employer do in Feb-March.
Previously I have seen that some employer deduct income tax at the end of the Financial year and some employer deduct tax at per month basis.
so whether monthly tax will deduct on my monthly salary or will deduct at the end of the year. I am asking this as I am confuse that i am not opting for PF then is there any ruling for monthly taxation if one not opting for PF so deduction of income tax will be monthly or total tax will deduct at the end of FY.
PF has nothing to do with the timing of tax deduction. As per the Income Tax rules, organizations should deduct tax each month at the average rate and not wait until the end of the year to start deducting tax.
my salary is increased above 15000 on July – 2015, but our organization cut my contribution amount after increase up to 6months contribution should must cut they told. if I don’t need a Esi contribution what can I do.
You can’t opt out of ESI in the middle of a 6 month period. Please wait until the end of the 6 months to move out of ESI.
If ESI cancelled, mediassist continue from next month or it will take some month?
Please check with your organization in this regard.
If an employee is working in a company on a CTC of Rupees 4 Lacs per annum. Lets assume, If he resigns from the company in July and now on two months notice period, then whether employer have to deduct provisional average Income tax in the last two months of his employment (Aug & Sept) when it is clear that employee will get a salary under tax range.
i.e.- Rs. 400,000 Annul CTC
so April to Sept salary ( 6 Months) will be 200,000/-
Income tax for the month of April, May, June & July is deducted as on gross salary.
but after resignation by the employee and coming on notice period, whether in August and September salary will employer have to deduct Income tax knowing that employee will take salary which totally is less then taxable range.
Once the employee resigns, the employee’s projected annual salary should be restricted to his last date of service (and not until the end of the year). Consequently, his income tax shall be re-computed keeping in mind His last working date. Correspondingly, his tax liability for his last months of service should be calculated.
i have 25 workers in my factory and all of them is above 15000/ month salary. so do we have to take esic registration and contribute for them and do they also have to contribute ( 4.75% + 1.75% ). what are the rules for esic and pf in this salary structure. Feel free to call.
awaiting your reply
Parvez
ESI
If the ESI wage is more than Rs 15,000 per month for all employees, there is no need to contribute ESI for any of the employees.
PF
You may have to register for PF. Employees who draw a PF wage of more than Rs 15,000 can be exempted subject to certain conditions. Please note that an employee cannot get out of PF just because he or she draws more than Rs 15,000 per month.
Dear Gautham,
I had monthly gross 15059/- & my esi deduction happened till Sep’15 as per payslip. Then I got migrated to sister concern of same organisation wef 7th Oct’15 & got increment to monthly gross 16565/-.
Now my query is “how long can I take esi treatment for contribution till Sep’15?” Secondly What about the news published in the year 2003 regarding wage revision to 25,000/- for esi deduction. Whom to questíon in this regard? Kindly suggest.
a. There shall be no ESI from Oct onwards.
b. The government has not issued any directive regarding wage revision to Rs 25,000.
Sir
plz inform to me any rule in esic schme for calculation of ESIC contribution how many % labour component for trunkey project work.
Thanks
sarata
I an unable to fully comprehend your question. Can you please rephrase it?
i have a salary package of 17500 in pvt ltd IT company less than 10 employees.can i have option to opt out from PF and ESI?
awaiting your response.
Yes. However, if your organization has voluntarily enrolled under PF and you have had PF deduction so far, you cannot opt out just because your salary goes above Rs 15,000.
salary of an employee is 13000/ mth but each month he earns 3-4000 as overtime.
We deduct his ESI on 15000 only is it OK
KIndly confirm
The ESI contribution should be on the total wages including overtime. This means that the ESI wage cannot be restricted to Rs 15,000. For example, if an employee receives Rs 17,000 including overtime, ESI should be calculated on Rs 17,000 and not on Rs 15,000.
sir,
as inquire that my salary increased in july month 2015 as 15000/- to 16000/- but my esi contribution detected as on last june month 2015, so sir pls tell that i will use esi benefits in which months
ESI benefits are available until remain an ESI member.
hi sir,
if i left the job and dont work for 6 month , so is that i get the benefit of esi in between 6 month
Unable to understand your question. Please rephrase it.
Is there any Minimum salary Criteria for deduction of Esic
Ex- suppose an employees salary is 7000 and due to LWP deduction the gross salary comes to 2500 in the month of october, In this case should we deduct Esic of this employee .(Esic has been deducted in the month of september)
Thanks in advance
There is no minimum salary for the purpose of ESI calculation.
I was entitled for ESI, and when my salary was increased, I came out of the ESI contribution. I am aged 55 and cannot join any other private insurance here after. Is there any option to continue my ESI benefits ? I am willing to pay the monthly contribution.
The ESI benefits are available until the end of the “benefit period” as specified in the ESI rules. Once you are out of the ESI coverage, you cannot extend the same.
Dear Gautham Sir,
I recently joined a company. I just wanted to know what are the deductions (in terms of taxes, PF, ESIC or any other deduction as per rules and laws of Mumbai/Maharashtra) and what are the benefits i am entitled to receive. (Kindly let me know all the benefits a normal employee should Enjoy, while serving a company and after retirement, also how many paid leaves and sick leaves are allowed per month/yearly) Also let me know what are the working hours criteria as i am working 12 hours here. (So my overtime starts after 8 hours?? but in contract it is strictly mentioned that i should do 12 hours and even work on a holiday if necessary without any remuneration. (So if i work on a holiday what should i demand an extra pay rather than normal day or a comp off)
Dear Here is the breakup of my salary
BASIC – 16750
HRA – 3000
TRAVEL – 1250
PHONE BILL – 500
He gives me only 16750 by cheque and rest by petty cash.
The reason he said for this is that if i take entire amount by cheque there will be deductions in my salary. (That is the reason i asked you the deductions).
Kindly Revert. Thanks
SAJID PATEL
9619293130
Kindly check with your HR team in this regard.
My salary is Rs. 19000/month shal I b eligible for Esic benefits..
If the ESI wage is greater than Rs 15,000 per month, you will not be eligible for ESI membership.
My salary is 17.5K .. I want ESI facility for my parents…. What I will do…plz help
You could consider evaluating insurance plans offered by insurance companies.
Dear Gouthamji,
I request you to clarify the below doubts please….:
1. Whether sales incentive is attracts ESI…We are paying this quarterly….
2. If employee monthly gross is 14500,if he gets Hardship Allowencesof rs.3000, his gross will be 17500.But we are deducting esi only on 15000/-.IS it OK. If not what action we have to take….
Regards,
Mrs.Smith
1. Whether sales incentive is attracts ESI…We are paying this quarterly….
Ans: If the sales incentive is paid at intervals not exceeding 2 months, it will have to be considered for the purpose of ESI. However, if the sales incentive is strictly paid only once each quarter, it can be excluded. In case it is paid monthly or once every two months, the ESI department may require you to include sales incentive for the purpose of ESI calculation.
2. If employee monthly gross is 14500,if he gets Hardship Allowencesof rs.3000, his gross will be 17500.But we are deducting esi only on 15000/-.IS it OK. If not what action we have to take….
Ans: ESI should be calculated on the actual ESI gross even if it is higher than Rs 15,000. Once cannot restrict ESI wages to Rs 15,000.
I currently draw 14000/-ctc and my esic is getting deducted, recently i had asked the finance dept to provide me with my esic details and they sent me the TIC CERTIFICATE which had a date already lapsed, so i had to go to the ESIC DISPENSARY alongwith the family photo attached to it, i want to know how long will the TIC be valid and whether the smart card they provide be the same ? also i want to know that if you join another company and the CTC is 16000/-p.m compared to 14000 ctc of the prior then will the new company maintain deductions or not?incase not then uptil when can i use the ESIC card for medical benefits ?will the already deducted esic usable during need inspite of leaving the company.
Kindly check with your employer in this regard.
Let me know the one time Salary components on which ESIC is applicable like bonus, leave salary, service awards, incentives, overtime etc.
This is too broad a question. Kindly go through the wage definition on the ESIC website.
Some months my salary is above 15000,some times it is less than 15000 ,from that month to continues 6 months deduct esi money
We are unable to understand your question.
If our Current Gross Salary 15000 and after increment the salary is Rs 16500 so in this case the employee is under ESIC or not if not then our previous deduction of ESI on 15000 So what benefit of ESI was cut from time of 15000 salary.
If the gross salary for the purpose of ESI goes above Rs 15,000, the employee will continue to be under ESI until the end of the relevant 6 month period (Apr to Sep or Oct to Mar). For example, if the ESI gross goes above Rs 15,000 in July, the employee shall continue to remain under ESI until Sep. From Oct onwards, the employee will cease being an ESI member.
Hi,
My annual CTC is 180386 and according to that monthly CTC Is 15032.
Still my ESI deduction amount is 624rs per month.
As per the ESI rules after 15000 ESI will not be debit and Employees contributions is 1.75%of wages. I have some doubts regarding that. Please help me.
Please let us know what your question is.
Hi
My gross wages is 15525/month and ESIC deduction Rs-272/month i.e 1.75% can i get ESIC benifits as per my last wages ( 12000/month ) or not.
Yes, you can.
If monthly salary is 15000 & employee is receiving approx 5000 as incentive per month (Total: Rs 20000). Whether he is eligible for ESIC Benefits?
I presume Incentive is a variable pay, paid out each month.
ESI Eligibility: Incentive should not be considered. Since the employee’s salary is Rs 15,000 after excluding the incentive amount, the employee will have to be covered under ESI.
ESI contribution: Should be calculated on the total pay, including the incentive amount.
Hi sir,
My self rahul my ctc is 16000 & gross salary is 14158.In hand salary is 12860
Kindly tell me esic amount detection on ctc or gross salary ? I m Very confused. what I eligible for esic facility
We will be able to answer this only if we get to know the break-up of your CTC / Gross Salary.
SIR, please can i have your email
i am a ca student and doing practical traning ( articalship) , i want your email for the queries plss help me sir i have alot of confusion regarding practical law manishbhadkariya@gmail.com this is my email plss drop your mail
Please send your email to info@hinote.in.
what kind of deductions are allowed to be taken from salary which calculating ESI amount??
ESI contribution/deduction is calculated as a percentage of ESI wages. Not sure what you mean by “deductions.”
Dear Sir/Mam,
I want to know which reason they will be contribute the amount, If his/her salary suddenly increase and it has been crossed above the limitation of ESIC slab. kindly ensure me.
We are unable to understand your question. Please rephrase it.
My CTC is 15900, Gross salary 14300
is it eligible for ESIC benefit…?
Yes, you are. I presume the gross salary comprises the typically used fixed heads of pay and the difference between CTC and gross is on account of statutory contributions such as Employer PF.
Sir,
Kindly advise me whether I am eligible to get ESI or not as my basic salary is Rs. 13,000/- and House Allowance: Rs. 1,500/- and TA&DA: Rs. 1,500/- (total will be Rs. 16,000/pm)
No, you are not eligible since the total wage amount is more than Rs 15,000 per month.
Increments for our staff have been effected from April but paid only in June as arrears. While ESI for April month only has been deducted, will those staff (who had come out of eligibility slab after increments) be eligible for ESI benefits even if there is no contribution towards ESI for remaining months in the half period?!
Once ESI is deducted in April, the ESI deduction/contribution has to be continued with until September. Just because the arrear salary is paid in June does not mean that employees get out of the ESI net in June. If an employee’s salary wages exceed Rs 15,000, you have to wait until October to stop ESI for the employee.
Dear sir
My existing gross is below 15000 & in that case i deduct esic but after increment in aug 15 my gross is above 15500 in this case i am deduct esic till mar 16 & from april 16 am not deduct esic.
But my consultant told me it is wrong if you existing deduct esic then you applicable for forever even your gross Rs 20000 or Rs 100000
so i am confuss so please give me correct feedback for i am right or my consultant
Refer to above case if you will have any notification so please share with me
Thanks
Sheetal zimbal
Once the salary goes above Rs 15,000 an employee ceases (from the next half year) to be an ESI member. It is not optional. The employee simply cannot be an ESI member.
For a person earning more than Rs.15000 esic deduction is optional and not mandatory . In case he wants to avail benefit of ESIC , he may opt for deductions on his cuurent gross salary . Is it true ?
Once the salary goes above Rs 15,000 an employee ceases (from the next half year) to be an ESI member. It is not optional. The employee simply cannot be an ESI member.
Dear Sir,
My present salary is above Rs.20,000/- Earlier I was under the ESIC. Can I eligible for ESIC benefit.
Please revert.
Krishnankutty
No, you cannot.
Hi,
If my salary changed from 14000 to 16000 w.e.f 1/4/2016 means upto March 2016, my gross is 14000 and changed to 16000 w.e.f 1/4/16 is esi should be deducted from my salary in April 2016 to September 2016.
No, there should be no ESI deduction for Apr 16 to Sep 16.
Sir,
I have left my job before six months and joined new company with current salary Rs.16000/-, so i want to continue my ESI Card, is it possible to continue my ESI card from other source.
No, it is not possible.
Of salary is 20000 can I get benefit from esic.
No, you cannot.
1 . An employee has crossed the ESI wage limit in APRIL ( contribution period April – Sept.)
2 . ESI contribution stopped in May ( contribution period April- Sept)
3 . whether he is eligible for ESI facilities after April.
4. If yes, for how many months
The ESI contribution can be stopped only after March or September contribution. Once ESI starts in Apr, the same should be continued with until the end of the contribution period i.e. Sep. If the ESI wage goes above Rs 15,000 in May, the ESI contribution cannot be stopped in May.
The ESI department specifies the “Benefit Period” (the period until which the ESI benefit can be availed) for each contribution period.
a. For the contribution period 1st April to 30 September, the corresponding benefit period is 1st January to 30th June of the year following.
b. For the contribution period 1st October to 31st March of the year following, the corresponding benefit period is 1st July to 31st December of the calendar year.
Hello
Has the rates for ESIC been changed to 4% from 6.5% ?
The ESI rate reduction is currently (Aug 16) at the proposal stage and hence has not been given effect.
Hi Gautham,
You Blog is interesting and informative.
I too have a query.
Should we deduct and pay employee / employer contribution with respect to an insured person if the member leaves in the middle of the contribution period.
Say if an IP quits his job in the month of August, should we pay his contribution till September?
Should we deduct and pay employee / employer contribution with respect to an insured person if the member leaves in the middle of the contribution period. Say if an IP quits his job in the month of August, should we pay his contribution till September?
You need to deduct and pay until the month the employee is in service (and not until September/March unless of course the employee works until Sep/March).
Noted, thank you Gautham…
Hi Gautham,
Aug-10-2016
A Employee crosses the border of ESIC limitation(Rs1500), after stoppage of deduction of contribution from the employee, what is the duration of benefit (medicine and etc,) he/ his spouses eligible to get? or they are not eligible after immediate stoppage of deduction ?
please reply.
The ESI department specifies the “Benefit Period” for each contribution period.
a. For the contribution period 1st April to 30 September, the corresponding benefit period is 1st January to 30th June of the year following.
b. For the contribution period 1st October to 31st March of the year following, the corresponding benefit period is 1st July to 31st December of the calendar year.
If contributions are paid/ payable for not less than 78 days in a contribution period for an employee, medical benefit is admissible till the
end of the corresponding benefit period. If the insured person is in ESI coverage for at least 2 years, and contributed for not less than 156 days, and is suffering from any of the 34 specified long-term diseases, the medical benefit is admissible till the incapacity lasts or for a period of 3 years for self and family.
The benefit periods and the corresponding rules for availing the benefit vary on the basis of the exact nature of the benefit availed.
Our company currently outside from esic area but from August 16 to applicability of esic.
Please tell how to save employer’s part maximum.
Organizations have to comply with ESI rules and there is nothing in the ESI act which enables you to save on ESI contribution.
dear sir
now Am Getting salary 19500 gross as on july plaese tel me am eligible for esi
thaking you
basavaraj
If your fixed salary is Rs 19,500 per month, you are not eligible for ESI.
Im working in a company my salary is less than 150000/-, but in my company there is no ESI or any other medical benefits, please let me now is there any way to get ESI benefit
Your company should be enrolled with ESI for you to receive ESI benefits.
Dear Sir,
I have been deducting ESIC contribution from my employees monthly .
I have employees who work in field and we will pay weekly DA for them.
Employees gross salary is 12000Rs.
While deducting ESIC from employee contribution i am deducting from their gross salary.
Should I add total DA and gross salary for ESIC deduction?
please clarify.
Yes, DA should be included for the purpose of ESI wage calculation.
As on 01.08.2016, there are 13 members in an establishment out of which 6 drawing salary above 15000. Is the establishment coverable under ESI Act? Is it possible to extend ESI benefits to all 13 employees up to 15000 or salary below 15000?
As on 01.08.2016, there are 13 members in an establishment out of which 6 drawing salary above 15000.
1. Is the establishment coverable under ESI Act?
Yes, it is.
2. Is it possible to extend ESI benefits to all 13 employees up to 15000 or salary below 15000?
Employees with salary less than or equal to Rs 15,000 should be covered under ESI. Other employees should be left out of ESI.
Has ESIC increase the limit of salary, from 15000 to 21000, to be an member. Please tell me that, M I eligible to be an member of ESIC, whereas my CTC is of 19000.
It is still (as of Sep 16) still Rs 15,000. Once the limit changes to Rs 21,000, you shall continue you to be member of ESI if your wage is Rs 19,000.
I am elidible for esi benefit. My question is that incase in a year i not used esi benefit but esi amount is debit in my accont.so this amout will be secqure and in future i can withdraw al this amont
For all ESI payments, the benefits are available until the “Benefit Period.”
My Ctc 15750 so esic deduct in my salary but this salary revised in june 16 so how much months deduct my esic
If you had ESI in Apr, it should be continued with until Sep.
Sir,
Our 1 employee leave job on 29th July, 2016, So can we pay ESIC both share(1.75% & 4.75%) till October, 2016?
No. The last contribution should be for July 2016.
sir mine ctc is 17000/- and in hand will be 14190/- is i am able for ESI.
and also our company deducting 2900rs i.e pf both side from us what to do.
If your wage is more than Rs 15,000 per month, you are ineligible for ESI.
if a company pays for medical insurance for employees and their families who are drawing below 15000/month should they enroll for ESI?
Yes, the company should include such employees for ESI.
Hi
My gross salary is 18750 and my in hand is 15055. My company is in rajasthan. Am i applicable for esic benefits and how much deduction will it be if applicable?
Effective Oct 2016, the wage limit for ESI eligibility is Rs. 21,000 per month. Hence, you are eligible for ESI from Oct 2016 onwards. The ESI deduction is calculated as 1.75% of your monthly wage.
Hi,
In any way can we justify which components are part of Wages for ESI cal.
Referring ESI website For Annual Bonus it is mentioned :
“Bonus paid to the employees could not be treated as wage for the purpose of charging of contribution under Sec.2(22), provided the periodicity of the payment is more than 2 months.”
here what does “the periodicity of the payment is more than 2 months.” means
Refers to payments which are paid once in a period greater than 2 months. For example, statutory bonus which is typically paid once every year falls in this category. We can also include quarterly payments in this regard.
ESI limit yanta
The ESI wage limit is Rs 15,000 (until Sep 16). There is a proposal to increase it to Rs 21,000 from Oct 16. We are yet (as of 05-Oct-2016) to receive the ESI department’s notification for the same.
SIR MY GROSS SALARY ATPRESENT IS 20900 DOES THE ORGANIZATION SHOULD DEDUCT MY ESI IF YES THAN WHAT I HAVE TO DO TO CONTINUE AND IF NEXT YEAR AFTER THE YEARLY INCREMENT MY SALARY CROSSES THE 21000 LIMIT WILL THE COMPANY DEDUCT MY ESI OR IT HAS THE RIGHT TO STOP. PLEASE CLARIFY MY CONFUSION.
The ESI department is yet (as of 11-Oct-2016) to implement the new salary limit.
my salary is 15,000.00 PM including both share of PF like employee share and employer share, Rs. 924.00 Employee share and 924.00 employer share, what is my gross salary for esic deduction i think it should be 13152.00 for esic deduction please clear my confusion
Please let us have your gross pay break-up for us to answer your question.
This ESI applicable on the in hand salary or the CTC(incentive+PF)??
It is calculated on ESI wages which should be calculated on the basis of ESI eligibility pertaining to the different heads of pay.
hi
I am working as HR officer in private organization. I want to know if in between any employee crosses wage ceiling limit then how to remove name of employee from list even the person still works in a firm.
You can remove the employee from ESI by entering the appropriate reason code (I think it is “4”) under the reason column in the ESI challan for Oct or Mar.
My question is one of our employee ( exiting member of of ESI) left his service on 1st week of October’16 (on 7th oct’2016 ) and his gross salary come down below 3000 then after he is under ESI for this month as if we calculate its per day salary is more than rs. ?100
Unable to understand your question. Can you please rephrase it?
Hi
what is the esi maximum ceiling limit? whether 15000 or 21000
It is Rs 15,000 as of now. We need to wait for the final notification from the government.
Thank u very much
If the Employer deposit the ESI Contribution for employee whose salary above the limit of Rs 15000/- , then employee can take benefit on behalf of above contribution ? or what is the treatment of voluntary contribution ?
Yes, the employee will receive the benefit of the employer contribution made on wages in excess of Rs 15,000/
This is helpful. I was looking for this specific question and found it right here.
How much money will deduct from my salary, if my salary is 18,000/- as per ESIC norms.?
The employee ESI deduction is calculated as 1.75% of the wage.
Sir, my monthly salary is 10000 and company says that deduction of pf and esi is mandatory but my financial problems i want to not deduct of pf or esi or both, is this possible or not by any option.My company says they were give ctc-10000/- for this i need to pay total pf and esi( some companies pay some persent of pf and esi) for this im not intersted for deduction of pf and esi. Please rply sir
Please note that PF and ESI rules are laid down by the statutory authorities and you cannot opt out of it.
let me know about elegible allowance
Please rephrase your question.
Will ESI be applicable if I am a Tax Payor?
Yes, an ESI member can be tax payer and vice versa.
Sir,
I want to Know the ESIC increase the ceiling limit for employees under ESIC coverage from the existing Rs. 15,000 a month to Rs. 21,000 from which date.Either with effect from Oct’2016 or Jan’ 2017.
For Assistance purpose relating to ceiling limit we phoned to ESIC toll free 1800-11-2526. They told ceiling limit was increased from Rs.15000/- a month to Rs.21,000/- with effect from october 2016.
Based on that we deducted from some employees & generated challan whose salary is above Rs.15000/- a month and below Rs.21000/- for Oct’16 & Nov’16 month later in the month Dec2016 we received Notification that the ESIC coverage from the existing Rs. 15,000 a month to Rs. 21,000 is with effect from Jan 2017.
Now one of our client is asking us why you have deducted ESIC amount for the employees who doesnot cover for Oct’ 2016 & Nov’16.
Kindly suggest us how to adjust the ESIC amount paid for the employees
in the month Oct’16 & Nov’16 month. Because this employees are eligible with effect from Jan 2017.
Thank You,
Chandu
The ESI wage ceiling enhancement is effective 01-Jan-2017. I am not sure on what basis the ESI personnel manning the toll free number said the effective date was 01-Oct-2016. The gazette notification clearly states that the enhancement is effective only from 01-Jan-2017.
I do not think it is possible to make any adjustment by way of changing the numbers in the ESI challan. Please check with the ESI office in this regard.
thank you, gautham.
Hi Gautam,
First of all thanks for the information and 2017 Update !!
My Salary is above 15,000 till JAN’17. And the rule says that the 21,000 limit is w.e.f from JAN’17.
But my company has deducted the ESI (nearly 1,000/- +) from salary in OCT’16,NOV’16 and DEC’16. How this is possible ??
What should I do now ?
Thanks,
Ajaysurya.
Your company should not have deducted ESI for Oct, Nov, and Dec 16. Your company was probably under the mistaken belief that the Rs 21,000 rule came into force in Oct 16 itself. There is nothing you, the employee, can do about this.
Your company should take this up with the ESI department and see if there is any remedy possible.
Hi,
I don’t have much knowledge of the ESI limit and i’m getting confused, i want a clarification on this my take home salary is 16.663. will the ESI amendment apply for my salary and whether my salary will get reduced or will it get increased ?
ESI is calculated on gross pay considering all the heads of pay to be included as per ESI rules. If your gross is less than (or equal to) Rs 21,000 you will come under ESI.
ESI is calculated on the basis of your gross pay (after excluding certain heads specifically exempted as per ESI rules). If your ESI gross is less than RS 21,000, you will come under ESI.
Sir/Madam,
Currently I am working in Pvt. organisation and drawing 19000/- salary p.m, out of which Rs. 360 has been deducted from my salary. My Mrs. is in Delhi Government and she has DGHS card facility in which I am also availing the benefit of DGHS on account of her husband.
Now My query is should I again pay an amount to ESI, in the other hand my Mrs. deduct amount for DGHS.
If, there is any rule, kindly tell me, I shall be very thankful to you
You have to covered under the ESI.
Hi Sir..
My total monthly CTC is 17600, can I get benefit of esic??
If yes then please let me know is it compulsory to deduct the esic benefit from CTC??
My company has deducted esic amount from my CTC…as per them this is new government policy..!!
Please revert….
Yes, ESI is mandatory for your salary.
hi,
ESIC is calculated on which amount (Basic pay or Gross salary or Net salary)
and 21000 of what basic, gross or net
ESI is calculated on the gross pay (after excluding certain heads specifically exempted as per ESI rules).
Hello sir, my gross saliey was 18000 p.m and I see there is some change in my income and my company is duducting addtional 4.75% and 1.75 on basic salary as esi. Starting January and there was no such deductions until January. It did not state anything about this in my offer letter. Please help
In January 2017, the ESI wage ceiling was increased to Rs 21,000 per month and hence you have come under ESI. Your employer could either have absorbed the cost of employer ESI (4.75%) or passed it on to you. They seem to have done the later. You can request your employer to absorb the employer ESI contribution.
If the offer letter was issued to your before Jan 2017, your employer wouldn’t have specified anything about ESI since the wage enhancement came into force only in Jan 2017.
Dear Sir,
I have Salary Rs.20,000/- but OT Wages and other allowance Included Rs.23,000/- then in which amount we need pay ESIC AMount Rs.21,000 or 23,000/-
ESI should be calculated on Rs 23,000.
But Gautham, will he be eligible for the ESIC with the salary of Rs. 23000 including OT and other allowances.
The answer to this question would depend on how Rs 23,000 is broken up under different heads.
Dear Sir,
I am Debanjan,working in DOZCO INDIA PVT LTD.My CTC Is Rs.21,900/- but Gross is Rs.20,150/- & Take Home Salary is Rs.19,163/-.Now From January,17 after ammendment of ESIC act my take home salary has gone down to Rs.17,912/-.Is it Right or wrong to deduct as i saw the Total Deduction of 6.5% for ESIC reduced by Employer?I want to Know The slab of Rs.21,000/- for ESIC,Is it calculated on CTC Or Gross Pay by company?
1. Is it Right or wrong to deduct as i saw the Total Deduction of 6.5% for ESIC reduced by Employer?
Ans: The employee contribution (1.75%) alone should be a deduction while the employer contribution (4.75%) should not be a deduction from the employee salary.
2. I want to Know The slab of Rs.21,000/- for ESIC,Is it calculated on CTC Or Gross Pay by company?
ESI is typically calculated on the gross pay after excluding heads of pay which are to be left out as per the ESI rules.
HI,
My in hand salary is 14000/-should be the esi deduction on my 14000?
ESI should be calculated on gross pay and not on net (on-hand) pay.
The salary of one of my employee is Rs 20,000 and his overtime comes to about Rs. Rs. 5000/- (which varies every month). Will he be eligible under esic as his salary is within the ceiling limit of Rs. 21,000/-. Is variable pay needs to be added for calculating esic.
Looking forward for a revert.
Thank you in advance
The employee will come under the ESI net. Overtime should be excluded for the purpose of determining whether an employee comes under ESI (calculating the total wage to check if it is below Rs 21,000). However, overtime should be included for the purpose of ESI calculation. In the case you have referred to, ESI should be calculated on Rs 25,000 (and not on Rs 20,000). I am assuming that all wage heads within Rs 20,000 are to be included for ESI.
if we are deducting Pf of employess..is it compulsoy to deduct ESIC for this employee
No, the eligibility for ESI should be checked separately.
Is there any other insurance policy for those employees who draw salary more than the prescribed limit?
If, so please tell us which is the best for employee.
You could consider one of the medical insurance policies (such as Mediclaim) offered by insurance companies.
From an employer perspective – I am into a startup and confused about ESI scheme, specifically on Contribution period and Benefit period.
If an employee has 15000/pm salary, his contribution will be 263rs and employer contribution will be 713rs.
Consider he is getting 15000/pm through out an year.
Now, do we need to pay the same contribution for 12 months or just for the Contribution period ( 6 months )
Any help is appreciated!
BR.
You need to pay ESI contribution until the end of the half-year. You will continue with ESI in the next half-year since the employee will continue to be under ESI on account of his salary remaining at Rs 15,000.
My take home salary was rs. 18000 before esic new rule and from janurary its going to be deducted and was getting rs. 16880 around and after an increment in march, they have done the increment on rs..16880 take home salary so is it right???
cz according to me they have to done the increment on my take home salary which i was getting before deduction of esic
It depends on the pay structure offered to you by your organization after the ESI change.
In March-2017 my Gross salary is 20000 rs. April-2017 my Gross Salary is 20000 and Over Time is 2000. will esi deduct or not.
ESI should be deducted since OT should be considered for ESI calculation and not for determining ESI eligibility.
But will it be right to do????
Why do you think it might be wrong?
My salary is 25000 is it able to ESI?
No
Dear Sir,
Suppose an employee whose salary is Rs. 20,000 in the month of April, 17 leave the organisation and rejoins the same organisation after 2 months ie., July, 2017 at Rs. 23,000/- whether he will be liable for ESIC deduction.
No
Hi Gautham, we had gone under the new ESI scheme (increment from 15 – 21k) and suddenly we have been deducted 2 months ESI amount (April and May 2017) since our company was not aware of the new change and even failed to notify us of the same.
I have understood that the scheme is implemented from Jan which means technically we should have all been intimated way before 2017 and ESI amount would be deducted from Jan onward.
Now, my Gross Salary is Rs.16,400 and take home after PF comes to Rs.15,022. Now after two months deduction, it is Rs.14445 (@Rs.287/month)
Now my question is,
1. Would our Gross Salary be increased to compensate since we were not under the old ESI scheme.
2.What happened to the 3 months ESI which was not deducted?
3.Is it illegal to take our money without intimation. (Basically until now we had no idea about ESI at all)
Thanks in advance for helping out with my queries.
Siddharth
1. Would our Gross Salary be increased to compensate since we were not under the old ESI scheme.
Ans: Whether or not the gross salary is increased is a matter of your organization’s policy. There is nothing in law in this regard.
2.What happened to the 3 months ESI which was not deducted?
Ans: If the ESI departments gets to know about this, your organization can be asked to pay the ESI for the period along with penal interest.
3.Is it illegal to take our money without intimation. (Basically until now we had no idea about ESI at all)
Ans: Most employment contracts/appointment letters state that all applicable statutory deductions will be made from the employee salary. Hence, it cannot be deemed to be illegal.
My salary was 19974 in hand before increment so mu esic started to deducting from my salary but in April my salary got revisited and now my gross is 23000 and in hand is 21662 then to my esic is getting deducted.. When confirm with my HR team they are saying it will get deducted till more 6 Months as it’s a coverage.. Kindly let me know what to do now as I don’t want any deducting in my salary for esic..
ESI, once started in April, should be continued with until Sep. One cannot stop ESI deduction in the middle of a half-year.
It has started deducting from jan’17..
If salary is 3000 is he/she eligible for pf and esi ?,please clarify
Yes, the employee is eligible to be covered under both PF and ESI.
If an employee has loss of pay in a month, contribution is calculated on gross salary on net salary?
kindly advice me.
Should be calculated on gross pay after reducing the loss of pay amount. For example, if the pay is Rs 15,000 and the loss of pay is Rs 1,000, then the contribution should be calculated on Rs 14,000.
Hello Sir,
In the month of June I got appraisal letter (in that it is mentioned “effective from April” ) & as per esic rule I should not be getting esic benefits as I crossed 21000, but then also esic has been deducted from my salary (April & May). So I wanted to know do I fall in esic criteria (contribution period April – September).
Though my increment is effective from April. Help me with your reply.
Not sure why your company still includes you for ESI. Kindly check with them.
Hi,
Am getting a monthly salary of 21750. Am i eligible for ESI
Please calculate your wages as defined by the ESI rules and check if it is below Rs 21,000 per month.
So Do I have to pay my ESI till Sep 2017
If you are under ESI in Apr 17, you need to continue with it at least until Sep 17.
my basic is 14479, DA ,1100 and basket of allowance is 4001 and bonus is 1400 per month pf 1869 grauity is 749 total23598 will esi is appicable still now.please advice
You should be under ESI.
Dear Gautham,
I have one doubt, hope you will be able to clear it. I want to know when an employee is getting his salary above the esi threshod, whether he is entitled for any other medical benifit from the employer. In other words whether it is mandatory for the employer to pay the medical allowance to such employees or not. Regards.
An employer can provide both ESI and other medical benefits.
Dear Gautham, sorry to stat that your answer is not explicit. my question was whether an employee who salary is above 21000, is entitled for medical allowance and whether it is mandatory of optional for an employer to pay MA.
ESI has nothing to do with MA. An employer may or.may not pay MA irrespective of whether an employee is covered under the ESI. In other words, payment of MA is optional.
thanks
Please let me know the ESIC deduction procedure. I am getting 19820 so should i pay esic or not.
You should be covered under ESI if your gross is less than Rs 21,000.
Hi,
My wife salary is 18k, is she eligible for ESIC?
She is planning to take maternity leave from October 2017.
Please advise.
She is eligible for ESI.
My salary is 22000 then I m eligible for esic deduction?
If your fixed gross is greater than Rs 21,000 per month, you are ineligible for ESI.
Hi
My salary just got over 21k but i want to keep going with esic and i am ready for deduction.. Is there any for doing this.. Please assist
No, you cannot remain under ESI.
my salary is 6500 then my pf celculation is
12% of Rs 6,500
Sir, My consolidated salary from April 2017 is Rs.22,000, which keeps me outside the purview of ESI scheme. But my employer still continues deducting from my salary for ESI scheme. Am I not entitled to get refund of the deducted amount?
Thanks
NS Viswanathan
Please check with your employer or the ESI authorities in this regard.
Hi Mr Gautham
My Net salary is 18000. Currently my employer has deducting 320 monthly for esi benefit..
Now my employer has decided to cover me under Apollo Munich Health insurance which I need to pay 966 as premium and sum assured is 3L.
Can you please advise me if I go with Private insurance as my own why I need to participate in E SIC. Is there any chance to opt out? From E SIC
ExpecExpecting your kind reply
You cannot opt out of ESI since there is no provision in law which exempts you from ESI just because you are covered by any other insurance policy.
Hi I am started working with one startup company. I am getting 15000 of monthly salary. In my organization they deducting for ESI monthly. But I asked the H.R and he said its mandatory.
may I Know the clear details about this deduction.
Can any one explain about this.
Your HR head is correct in saying this. There is a lot of information on the ESI (purpose, extent of deduction etc.) on the internet.
Hi
Let me know the ESIC CARD/policy is Eligible for treatment, if the employee month salary is more than 30,000/-
Regards
Raj
Once you are out of ESI, you cannot avail ESI benefits.
Dear All my gross salary is 20500 I am under benefit of ESIC
after 25000 how can I continue my esic card I really very need it
pls suggest me any option
Once you get out of the ESI net on account of your salary going up, you cannot avail ESI benefits.
ok thanks
I just wanted to know because of my father’s treatment he is about 58
my basic salary is 10000 and total gross is 20500
My CTC is 20000 and before the updation of ESIC Rules i am getting 18440 take home and after the effect of new rule my take home is 17100 , how much ESIC is allowed to deduct?
ESI deduction = 1.75% of your salary.