Hello
Under the applicability for ESIC Act, its is said in the act that it is applicable when 10 (for factories) / 20 (for other establishment) or more employees are employed in the preceeding 12 months on any day.
My query is whether the word "employed" means employed on rolls or employed AND present on one single day.
eg: One may have 25 employees employed from 01st to 30th but it may so happen that no one day in the month all 20 employees were present. In such case whether the ESIC Act applicability will be checked on the basis of the fact that:
1) 25 people were on the muster roll of the employer & hence ESIC is applicable OR
2) no single day 20 employees were present all-together & hence the applicability doesn't arise.
Experts may throw some light on this subject.
Thanks in advance for your response.
From India, Aurangabad
14Under the applicability for ESIC Act, its is said in the act that it is applicable when 10 (for factories) / 20 (for other establishment) or more employees are employed in the preceeding 12 months on any day.
My query is whether the word "employed" means employed on rolls or employed AND present on one single day.
eg: One may have 25 employees employed from 01st to 30th but it may so happen that no one day in the month all 20 employees were present. In such case whether the ESIC Act applicability will be checked on the basis of the fact that:
1) 25 people were on the muster roll of the employer & hence ESIC is applicable OR
2) no single day 20 employees were present all-together & hence the applicability doesn't arise.
Experts may throw some light on this subject.
Thanks in advance for your response.
From India, Aurangabad
Dear sunnydays When 20 or 20 Plus employees will be on the payroll/contract in the company, then it will become mandatory for the company to take the ESIC.
Now it is not 20 but 10 in all cases. Therefore, if on any day, the number of employees engaged either directly or through contractor is 10, then the ESI will be applicable since that date.
Regards,
Madhu.T.K
From India, Kannur
Regards,
Madhu.T.K
From India, Kannur
Dear Friend ESIC Applicability means any day of any month in proceeding twelve months. whether 10 employees to be uncovered i.e. above more than Rs.15000/- even also ESIC Act will be applicable.
From India, Delhi
From India, Delhi
Dear Friends
Pls suggest for my query,
In my organisation having employement of more than 30 members and every body pay is more than ESIC limit. I just want to know do we need to registered under ESIC even we are not eligible to deduct ?
regards
vikram
From India, Bangalore
Pls suggest for my query,
In my organisation having employement of more than 30 members and every body pay is more than ESIC limit. I just want to know do we need to registered under ESIC even we are not eligible to deduct ?
regards
vikram
From India, Bangalore
Dear Vikram, Yes, As per ESI Amendment Act, 2010 Sec.2(12) ESI will attract in your organisation. Regards, J.Basak
From India, Calcutta
From India, Calcutta
irrespective of eligibility to deduct ..,your company is eligible to get ESI Number based on number of employees working in your company.
From India, Delhi
From India, Delhi
Mr Vikram / J. Basak / Spectrained
I would like to clarify about your vision of Sec 2(12) ESI Amendment Act. Be informed that in case of Vikram or where all employees getting wages/salary exceed 15000/- there is no need to get ESI registration because they all are exempted employees however when a single person join who is getting less 15000/- pm then in the same month there is a need to get registration in ESI act and the applicability of Act will continue from the day when a person join who is eligible for ESI i.e. getting wages up to Rs.15000/-.
The definition of Factory under Section 2(12) has been amended to expand coverage of smaller factories. The amended Act covers all factories which employ 10 or more persons irrespective of the fact whether the manufacturing process is being carried out with the aid of the power or without the aid of the power.
From India, New Delhi
I would like to clarify about your vision of Sec 2(12) ESI Amendment Act. Be informed that in case of Vikram or where all employees getting wages/salary exceed 15000/- there is no need to get ESI registration because they all are exempted employees however when a single person join who is getting less 15000/- pm then in the same month there is a need to get registration in ESI act and the applicability of Act will continue from the day when a person join who is eligible for ESI i.e. getting wages up to Rs.15000/-.
The definition of Factory under Section 2(12) has been amended to expand coverage of smaller factories. The amended Act covers all factories which employ 10 or more persons irrespective of the fact whether the manufacturing process is being carried out with the aid of the power or without the aid of the power.
From India, New Delhi
Dear Mr.IR-MANAGER,
FACTORY -DEFINITION-Clause 12 of Section 2 has been amended -
The old definition and New definition of Factory needs to be compared, thus I am reproducing the both for ready reference:-
OLD DEFINITION:- Prior to ESI Amendment Act 2010
Sec 2 (12) “factory” means any premises including the precincts thereof-
(a) whereon ten or more persons are employed or were employed FOR WAGES on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on with the aid of power or is ordinarily so carried on, or
(b) whereon twenty or more persons are employed or were employed for wages on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on without the aid of power or is ordinarily so carried on,but does not include a mine subject to the operation of the Mines Act, 1952 (35 of 1952) or a railway running shed];
NEW DEFINITION:-
Sec 2 (12) "factory" means any premises including the precincts thereof whereon ten or more persons are employed or were employed on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on or is ordinarily so carried on, but does not include a mine subject to the operation of the Mines Act, 1952 or a railway running shed;’.
On comparing the both the following implications of the amendment comes out:-
• Now the units where manufacturing activities are performed by 10 or more PERSONS has been brought under the ambit of the Act, irrespective of use of POWER and irrespective of the fact that 10 or more coverable employees are engaged or not.
• The definition of the "Factory" has been amended to bring the small units within the ambit of the Act. Earlier the ESI Act was applicable to units employing 10 or more persons manufacturing with aid of "POWER"- Now the word POWER has been omitted. Thus, every unit manufacturing and employing 10 or more persons has been brought under the ambit of the ESI Act.
• Secondly, one hidden amendment has been made in the Act-The uncovered employees would also be counted for the purpose of applicability of the ESI Act. Earlier the unit employing 10 or more workers and doing manufacturing process, would still be out of the purview of the Act, if there are Persons drawing salary above the prescribe limit.
But now, the ESI Corpn. has very smartly omitted the words "for wages" in the new definition of the "Factory", bringing all the units employing 10 or more Persons and engaged in manufacturing process within its ambit.
It was necessary to know the old definition of the Factory to understand the exact implication of the latest amendment in the definition of "Factory".
As per new definition, it has been clearly mentioned that if ten or more persons are employed or were employed on any day of the preceding twelve months (irrespective of wages) ESI will be applicable.
Regards,
J.Basak
From India, Calcutta
FACTORY -DEFINITION-Clause 12 of Section 2 has been amended -
The old definition and New definition of Factory needs to be compared, thus I am reproducing the both for ready reference:-
OLD DEFINITION:- Prior to ESI Amendment Act 2010
Sec 2 (12) “factory” means any premises including the precincts thereof-
(a) whereon ten or more persons are employed or were employed FOR WAGES on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on with the aid of power or is ordinarily so carried on, or
(b) whereon twenty or more persons are employed or were employed for wages on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on without the aid of power or is ordinarily so carried on,but does not include a mine subject to the operation of the Mines Act, 1952 (35 of 1952) or a railway running shed];
NEW DEFINITION:-
Sec 2 (12) "factory" means any premises including the precincts thereof whereon ten or more persons are employed or were employed on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on or is ordinarily so carried on, but does not include a mine subject to the operation of the Mines Act, 1952 or a railway running shed;’.
On comparing the both the following implications of the amendment comes out:-
• Now the units where manufacturing activities are performed by 10 or more PERSONS has been brought under the ambit of the Act, irrespective of use of POWER and irrespective of the fact that 10 or more coverable employees are engaged or not.
• The definition of the "Factory" has been amended to bring the small units within the ambit of the Act. Earlier the ESI Act was applicable to units employing 10 or more persons manufacturing with aid of "POWER"- Now the word POWER has been omitted. Thus, every unit manufacturing and employing 10 or more persons has been brought under the ambit of the ESI Act.
• Secondly, one hidden amendment has been made in the Act-The uncovered employees would also be counted for the purpose of applicability of the ESI Act. Earlier the unit employing 10 or more workers and doing manufacturing process, would still be out of the purview of the Act, if there are Persons drawing salary above the prescribe limit.
But now, the ESI Corpn. has very smartly omitted the words "for wages" in the new definition of the "Factory", bringing all the units employing 10 or more Persons and engaged in manufacturing process within its ambit.
It was necessary to know the old definition of the Factory to understand the exact implication of the latest amendment in the definition of "Factory".
As per new definition, it has been clearly mentioned that if ten or more persons are employed or were employed on any day of the preceding twelve months (irrespective of wages) ESI will be applicable.
Regards,
J.Basak
From India, Calcutta
Ok you may agree with ur definition but please reply me about the following :-
1 . suppose a company is engaged 30 employees / workman for wages and all of them are getting Rs.20000/- (Twenty Thousand per month) and as per your understanding of the new amendment factory will covered under ESI act So....
2. What happens from the next month when wages come out and every employee is a exempted ?
(a) Does the company will deduct the ESI contribution from the salary of employees getting 20000/- per month ?
(b) if not what is the benefit of coverage of ESI if no contribution paid to ESIC every month?
From India, New Delhi
1 . suppose a company is engaged 30 employees / workman for wages and all of them are getting Rs.20000/- (Twenty Thousand per month) and as per your understanding of the new amendment factory will covered under ESI act So....
2. What happens from the next month when wages come out and every employee is a exempted ?
(a) Does the company will deduct the ESI contribution from the salary of employees getting 20000/- per month ?
(b) if not what is the benefit of coverage of ESI if no contribution paid to ESIC every month?
From India, New Delhi
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