Dont you think you should have separate thread for this topic
From India, Mumbai
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2635From India, Mumbai
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Any one can tell me that the recent amendment in ESIC deduction up to 250000/- gross is implemented. Regards, Vinod Kumar
From India, Delhi
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From India, Delhi
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Position at a progressive institute offering opportunity for advancement based upon achievement and contribution to the institution Willingness to work hard anywhere in the country.
From India
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From India
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Dear Friends,
ESIC calculation is purely based on gross earned salary, i.e., 1.75% from the employee and 4.75% from the employer. There is no provision for additional deductions in ESIC.
If an employee's salary is fixed at 15000 per month, they are eligible for ESIC benefits; otherwise, not.
For employees whose salary is less than 15000 and receive incentives or other performance-based bonuses, those amounts also need to be deducted when calculating ESIC.
Example:
An employee with a fixed salary of Rs. 12000, receiving an Rs. 8000 incentive, will have ESIC calculated on the total of Rs. 20000, not just Rs. 12000.
Note: Annual bonuses will not be included in ESIC calculations.
There are other types of ESIC calculations based on fixed assets/installations from outsiders, calculated as follows:
The total invoice amount is divided into 60% material and 40% labor. The 40% labor amount incurs a 6.5% ESI charge.
Example: Assuming the total invoice value is 100000
- 60% material: 60000
- 40% labor: 40000
ESIC calculation will be on 40000 * 6.5%, i.e., Rs. 2600. This Rs. 2600 is referred to as Job work, which should be deducted from the invoice value and paid in the Omitted wages option in the ESIC portal.
Thanks and Regards,
JOYSON BAPTIST PEREIRA
Sr. HR Executive
Automobile
joyjeni87@gmail.com
From India, Bangalore
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ESIC calculation is purely based on gross earned salary, i.e., 1.75% from the employee and 4.75% from the employer. There is no provision for additional deductions in ESIC.
If an employee's salary is fixed at 15000 per month, they are eligible for ESIC benefits; otherwise, not.
For employees whose salary is less than 15000 and receive incentives or other performance-based bonuses, those amounts also need to be deducted when calculating ESIC.
Example:
An employee with a fixed salary of Rs. 12000, receiving an Rs. 8000 incentive, will have ESIC calculated on the total of Rs. 20000, not just Rs. 12000.
Note: Annual bonuses will not be included in ESIC calculations.
There are other types of ESIC calculations based on fixed assets/installations from outsiders, calculated as follows:
The total invoice amount is divided into 60% material and 40% labor. The 40% labor amount incurs a 6.5% ESI charge.
Example: Assuming the total invoice value is 100000
- 60% material: 60000
- 40% labor: 40000
ESIC calculation will be on 40000 * 6.5%, i.e., Rs. 2600. This Rs. 2600 is referred to as Job work, which should be deducted from the invoice value and paid in the Omitted wages option in the ESIC portal.
Thanks and Regards,
JOYSON BAPTIST PEREIRA
Sr. HR Executive
Automobile
joyjeni87@gmail.com
From India, Bangalore
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Dear Mr. Pereira,
I have read the information furnished by you regarding the treatment of 40% of wages out of total bills for ESI compliance. However, for discussion's sake, I would like to inform you that there may be old instructions issued by the ESIC authorities in support of your information. In actual practice, these instructions are not followed, resulting in the claim that 100% of the bill amount should be treated as wages for claiming ESI contributions on such omitted wages.
In my opinion, the safe practice is that when the employer appoints any person as a contractor or casual labor for job work, the employer should insist on the maintenance of Attendance & Wages Registers for such contract/casual employees and pay ESI contributions based on actual wages. Payment of ESI contributions on an actual basis and compliance based on the actual basis for such contractor/casual employees will also entitle these employees to various benefits under the Employees' State Insurance Act, 1948, and the rules/regulations framed thereunder.
Furthermore, I believe that accepting 40% as wages out of a bill for job work, as mentioned by you, is also not within the jurisdiction of the appropriate Social Security Officer in your area.
If you have any doubts, I suggest confirming the position with the appropriate Regional/Sub-Regional Office of ESIC.
With regards;
From India, Noida
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I have read the information furnished by you regarding the treatment of 40% of wages out of total bills for ESI compliance. However, for discussion's sake, I would like to inform you that there may be old instructions issued by the ESIC authorities in support of your information. In actual practice, these instructions are not followed, resulting in the claim that 100% of the bill amount should be treated as wages for claiming ESI contributions on such omitted wages.
In my opinion, the safe practice is that when the employer appoints any person as a contractor or casual labor for job work, the employer should insist on the maintenance of Attendance & Wages Registers for such contract/casual employees and pay ESI contributions based on actual wages. Payment of ESI contributions on an actual basis and compliance based on the actual basis for such contractor/casual employees will also entitle these employees to various benefits under the Employees' State Insurance Act, 1948, and the rules/regulations framed thereunder.
Furthermore, I believe that accepting 40% as wages out of a bill for job work, as mentioned by you, is also not within the jurisdiction of the appropriate Social Security Officer in your area.
If you have any doubts, I suggest confirming the position with the appropriate Regional/Sub-Regional Office of ESIC.
With regards;
From India, Noida
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Hi friends,
We registered one of my employees in ESI 4 months ago, but recently we discovered that the person was already registered with ESI and also had a PAN card. This month, I entered his IP in the ESI website. The issue arises when we try to pay the challan as both IPs are showing for contributions. We have been making payments for the new IP for three months, but now I need to pay for his registered IP that is associated with his PAN card. What should I do about the other IP?
From India, Madgaon
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We registered one of my employees in ESI 4 months ago, but recently we discovered that the person was already registered with ESI and also had a PAN card. This month, I entered his IP in the ESI website. The issue arises when we try to pay the challan as both IPs are showing for contributions. We have been making payments for the new IP for three months, but now I need to pay for his registered IP that is associated with his PAN card. What should I do about the other IP?
From India, Madgaon
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Dear sir’s, Pls help me on the topic of maximum EL leave taken in a row.
From India, Lucknow
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From India, Lucknow
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Dear Mr. Harsh,
ESI contributions under the contract depend on the bill. If materials and labor are mentioned separately in the bill, ESI is paid on the labor portion at a rate of 6.5%. Otherwise, it will be 40% of the total bill at 6.5%.
If the contractor is not covered by ESI but the factory of the principal employer is covered under the act, then the employees would be considered covered under the principal employer. In this case, the principal employer will deduct 6.5% (1.75% from the employee and 4.75% from the employer) and pay it to ESIC.
You mentioned registers for employees. What if the contract is only for a day or a week?
Thank you.
From India, Bangalore
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ESI contributions under the contract depend on the bill. If materials and labor are mentioned separately in the bill, ESI is paid on the labor portion at a rate of 6.5%. Otherwise, it will be 40% of the total bill at 6.5%.
If the contractor is not covered by ESI but the factory of the principal employer is covered under the act, then the employees would be considered covered under the principal employer. In this case, the principal employer will deduct 6.5% (1.75% from the employee and 4.75% from the employer) and pay it to ESIC.
You mentioned registers for employees. What if the contract is only for a day or a week?
Thank you.
From India, Bangalore
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What if we pay ESI for an employee earning more than 15,000 p.m. from the start of contribution period. Can the ESIC say that he is exempt employee, hence not elgible for ESI benefits !
From India, Jamnagar
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From India, Jamnagar
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Sir,
As an employer or HR professional dealing with ESI matters, one may cover any employee under the ESI Act, 1948, and rules/regulations framed thereunder. However, at the time of claiming cash benefits, the eligibility of insured persons is verified by the appropriate Branch Office of ESIC. If it is found that the employee was not entitled to coverage due to wages exceeding the coverage limit as laid down in the ESI (Central) Rules, 1952, then no benefits are payable, and in such an eventuality, the benefits wrongly availed earlier are all recoverable under section 70 of the said Act.
In addition, the employee or employer is liable for prosecution under section 84 of the said Act. The employee can also be barred from receiving any benefits for certain periods under Rule 62 of the ESI (Central) Rules, 1952. Please also refer to Regulation 40 of the ESI (General) Regulations, 1952, regarding the refund of contributions erroneously paid.
From India, Noida
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As an employer or HR professional dealing with ESI matters, one may cover any employee under the ESI Act, 1948, and rules/regulations framed thereunder. However, at the time of claiming cash benefits, the eligibility of insured persons is verified by the appropriate Branch Office of ESIC. If it is found that the employee was not entitled to coverage due to wages exceeding the coverage limit as laid down in the ESI (Central) Rules, 1952, then no benefits are payable, and in such an eventuality, the benefits wrongly availed earlier are all recoverable under section 70 of the said Act.
In addition, the employee or employer is liable for prosecution under section 84 of the said Act. The employee can also be barred from receiving any benefits for certain periods under Rule 62 of the ESI (Central) Rules, 1952. Please also refer to Regulation 40 of the ESI (General) Regulations, 1952, regarding the refund of contributions erroneously paid.
From India, Noida
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PAYMENT OF WAGES ACT 2009.doc