Yes Mr. Deepak is right. The Applicability is based on the number of employes ( 20 or 20+ on any working day) not based on the salary. Contributing to ESI is based on the Salary limit.
From India, Lucknow
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1From India, Lucknow
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Hi,
As per the latest amendment in the ESI rules, at least 20 employees must be drawing up to Rs. 10,000/pm, and only then the establishment is coverable. Suppose you have 30 employees, but fewer than 20 employees are drawing a salary of less than Rs. 10,000/pm, you are not coverable.
Thanks,
Sanjeev Kwatra
Email: sunilsanjeev@hotmail.com
From India, Delhi
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As per the latest amendment in the ESI rules, at least 20 employees must be drawing up to Rs. 10,000/pm, and only then the establishment is coverable. Suppose you have 30 employees, but fewer than 20 employees are drawing a salary of less than Rs. 10,000/pm, you are not coverable.
Thanks,
Sanjeev Kwatra
Email: sunilsanjeev@hotmail.com
From India, Delhi
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Hi All,
Wage Ceiling: Every employee drawing wages up to Rs. per month is required to be insured under the Act.
Applicability: Section 2(9) 'employee' under ESI means any person who is engaged/employed for wages/salary in connection with the work of the establishment to which this Act applies. However, it does not include any person whose wages (excluding OT) exceed the limit prescribed by the Central Govt. (which is 10000 pm now).
Section 2(12): 'establishment' under ESI means any premises whereon 20 or more persons are employed or were employed for wages. If you combine both, you understand that if the total employees are 25 but out of which 14 are drawing gross more than 10000 pm, then only 11 employees come under ESIS, and the criteria for 20 employees does not fulfill. Hence, on the above grounds, it is not covered.
Thanks & regards,
Sayed Iqbal
Excel Consultancy Services
iqbal@excelconsultancyservices.co.in
From India, Mumbai
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Wage Ceiling: Every employee drawing wages up to Rs. per month is required to be insured under the Act.
Applicability: Section 2(9) 'employee' under ESI means any person who is engaged/employed for wages/salary in connection with the work of the establishment to which this Act applies. However, it does not include any person whose wages (excluding OT) exceed the limit prescribed by the Central Govt. (which is 10000 pm now).
Section 2(12): 'establishment' under ESI means any premises whereon 20 or more persons are employed or were employed for wages. If you combine both, you understand that if the total employees are 25 but out of which 14 are drawing gross more than 10000 pm, then only 11 employees come under ESIS, and the criteria for 20 employees does not fulfill. Hence, on the above grounds, it is not covered.
Thanks & regards,
Sayed Iqbal
Excel Consultancy Services
iqbal@excelconsultancyservices.co.in
From India, Mumbai
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Dear Friend,
Both sections are independent, and we cannot consolidate them for our expression because the Act does not mention that both conditions are cumulative; they are independent. There are two independent conditions: 20 or more employees and 10,000 or less. The first condition is the coverage of the establishment, and the second one is for contribution. Therefore, if no one is earning 10,000 or less but there are 20 or more employees, then registration is still required; however, the contribution will be nil.
Regards,
Deepak Singh
From India, Mumbai
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Both sections are independent, and we cannot consolidate them for our expression because the Act does not mention that both conditions are cumulative; they are independent. There are two independent conditions: 20 or more employees and 10,000 or less. The first condition is the coverage of the establishment, and the second one is for contribution. Therefore, if no one is earning 10,000 or less but there are 20 or more employees, then registration is still required; however, the contribution will be nil.
Regards,
Deepak Singh
From India, Mumbai
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This est. is not coverable under ESI Act.. u may also confirm the same from esic office. Sanjeev Kwatra
From India, Delhi
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From India, Delhi
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Section 2(9) and 2(12) - Meaning of the words 'employee' and 'factory' - A person getting more wages than the limit prescribed by the Central Government under Section 2(9)(b) would not be an employee within the meaning of Section 2(9). Therefore, where thirteen out of twenty-four persons working with a company were getting more wages than the said prescribed limit, the company would not be a factory within the meaning of Section 2(12), and the Act would not be applicable to the company.
Sayed Iqbal
Excel Consultancy Services
iqbal@excelconsultancyservices.co.in
From India, Mumbai
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Sayed Iqbal
Excel Consultancy Services
iqbal@excelconsultancyservices.co.in
From India, Mumbai
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Dear Subhash,
If you have 20 or more employees, you must adhere to the code, regardless of whether the employees fall under the slab or not; that is a secondary issue. You are describing the current status, but who knows what tomorrow may bring.
Krishna Mohan
From India, Hyderabad
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If you have 20 or more employees, you must adhere to the code, regardless of whether the employees fall under the slab or not; that is a secondary issue. You are describing the current status, but who knows what tomorrow may bring.
Krishna Mohan
From India, Hyderabad
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Hi Sayed,
Could you provide more insight into this? If an organization is covered under the ESI Act, but later on, the number of employees reduces below the limit prescribed by the law, will it still be covered under the ESI Act?
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Could you provide more insight into this? If an organization is covered under the ESI Act, but later on, the number of employees reduces below the limit prescribed by the law, will it still be covered under the ESI Act?
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Hi,
Once the establishment/factory is covered under the ESI Act, even if the total number of employees reduces below the prescribed limit, the establishment will continue to be covered under the Act, and ESI deductions must be made for all eligible employees.
From India, Lucknow
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Once the establishment/factory is covered under the ESI Act, even if the total number of employees reduces below the prescribed limit, the establishment will continue to be covered under the Act, and ESI deductions must be made for all eligible employees.
From India, Lucknow
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Changes in the Applicability and Coverage of ESI Scheme under the Code on Social Security.doc
Applicability of ESI Act.pdf