Dear All, Please confirm about meaning of "wages" under ESIC Act. On which amount we have to deduct ESI Contribution ? Is it Gross Salary or Basic Salary ?? Thanks, Navin Ch. Joshi
From India, New Delhi
5From India, New Delhi
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you have to deduct esi from gross salary . 1.75% from employee and 4.75% is employer contribution
From India, Tirunelveli
From India, Tirunelveli
As per the provisions of the ESI Act, under Section 2(12), the Act is applicable to factories employing 10 or more persons, irrespective of whether power is used in the process of manufacturing or not.
Under Section 1(5) of the Act, the Scheme has been extended to shops, hotels, restaurants, cinemas including preview theatres, road motor transport undertakings, and newspaper establishments employing 20 or more persons.
Further, under Section 1(5) of the Act, the Scheme has been extended to Private Medical and Educational Institutions employing 20 or more persons in certain States. The State Government has been requested to issue a notification under Section 1(5) on the lines of Section 2(12) keeping the threshold limit for coverage as 10 employees instead of 20.
The existing wage limit for coverage under the Act is Rs. 15,000 per month (with effect from 01.05.2010).
From India, Madras
Under Section 1(5) of the Act, the Scheme has been extended to shops, hotels, restaurants, cinemas including preview theatres, road motor transport undertakings, and newspaper establishments employing 20 or more persons.
Further, under Section 1(5) of the Act, the Scheme has been extended to Private Medical and Educational Institutions employing 20 or more persons in certain States. The State Government has been requested to issue a notification under Section 1(5) on the lines of Section 2(12) keeping the threshold limit for coverage as 10 employees instead of 20.
The existing wage limit for coverage under the Act is Rs. 15,000 per month (with effect from 01.05.2010).
From India, Madras
Friends,
Thanks for all the write-ups and replies on the topic of ESIC. However, I would like to know specifically the following under ESIC: Do the following get covered under "Wages" as defined under the ESIC Act:
A. LTA, i.e., Leave Travel Allowance (a benefit given once a year which is also subject to exemption under Income Tax provisions);
B. Leave encashment - this could be taken more than once subject to the available leave in one's account - normally it is also availed once a year;
C. Performance Incentive - paid once a year based solely on one's performance during the previous year;
D. Amount paid every month and termed as "Travelling Allowance" forming part of one's payslip as one component of monthly salary.
Regards,
Kohinoor Mirra
From India, Hyderabad
Thanks for all the write-ups and replies on the topic of ESIC. However, I would like to know specifically the following under ESIC: Do the following get covered under "Wages" as defined under the ESIC Act:
A. LTA, i.e., Leave Travel Allowance (a benefit given once a year which is also subject to exemption under Income Tax provisions);
B. Leave encashment - this could be taken more than once subject to the available leave in one's account - normally it is also availed once a year;
C. Performance Incentive - paid once a year based solely on one's performance during the previous year;
D. Amount paid every month and termed as "Travelling Allowance" forming part of one's payslip as one component of monthly salary.
Regards,
Kohinoor Mirra
From India, Hyderabad
Hi,
Any payments made on a yearly basis or at an interval of more than 2 months don't attract ESIC contributions. Apply this base rule to get an answer to your query. Please note that reimbursements don't attract ESIC contributions, but allowances do. For example, reimbursements for expenses incurred on Newspaper/Periodicals don't attract ESIC contribution, but a salary component named Newspaper Allowance paid on a monthly basis will attract ESIC contributions.
Regards,
Amitava Majumder
From India, Calcutta
Any payments made on a yearly basis or at an interval of more than 2 months don't attract ESIC contributions. Apply this base rule to get an answer to your query. Please note that reimbursements don't attract ESIC contributions, but allowances do. For example, reimbursements for expenses incurred on Newspaper/Periodicals don't attract ESIC contribution, but a salary component named Newspaper Allowance paid on a monthly basis will attract ESIC contributions.
Regards,
Amitava Majumder
From India, Calcutta
Dear Kmitra,
Amitava Majumder has addressed your query in a better way. Still, for your specific query:
A. LTA, i.e., Leave Travel Allowance - NO
B. Leave encashment - NO
C. Performance Incentive - NO
D. Traveling Allowance - YES
Regards,
Kamal P
From India, Pune
Amitava Majumder has addressed your query in a better way. Still, for your specific query:
A. LTA, i.e., Leave Travel Allowance - NO
B. Leave encashment - NO
C. Performance Incentive - NO
D. Traveling Allowance - YES
Regards,
Kamal P
From India, Pune
ESIC Contribution is deducted based on the number of days worked in that month. For example, if an employee has taken 2 days of leave in the month of January 2011, then the ESI contribution calculation will be on 31-2=29 days * per day salary.
Please let me know if you need any more information.
From India, Pune
Please let me know if you need any more information.
From India, Pune
Dear Rajendra, ESIC is not applicable on construction industry just see the following attachments for your reference. Thanks & Regards Sunil Sharma V3S Group
From India, New Delhi
From India, New Delhi
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