I wanted to ask whether overtime allowance is included in the gross salary for ESI deduction or not. Secondly, if the monthly salary of a person is increased from 14000 to 18000, on what salary is ESI deducted.
From India
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1From India
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- Yes, overtime salary is a part of the gross salary, and ESI must be deducted on it.
- If Rs. 14,000 goes to Rs. 18,000, then also you have to deduct ESI on the total gross of Rs. 18,000 (1.75% from the employee), and the company needs to add it as part of the 4.75% on the Rs. 18,000 gross salary.
I hope your confusion is cleared now.
From Singapore
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- If Rs. 14,000 goes to Rs. 18,000, then also you have to deduct ESI on the total gross of Rs. 18,000 (1.75% from the employee), and the company needs to add it as part of the 4.75% on the Rs. 18,000 gross salary.
I hope your confusion is cleared now.
From Singapore
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Respected Sir,
I wanted to ask further, if the salary is increased (from 14000 to 18000) in between any of the contribution periods of ESI, either April-September or October-March, will ESI still be deducted on Rs. 18000 until that contribution period ends?
From India
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I wanted to ask further, if the salary is increased (from 14000 to 18000) in between any of the contribution periods of ESI, either April-September or October-March, will ESI still be deducted on Rs. 18000 until that contribution period ends?
From India
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Sir, But the Esic coverage is upto 15000/- gross salary,then how can we deduct on 18000/-.Please clarify my doubt
From India, Madras
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From India, Madras
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ESI have to deduct for overtime wages but it should not be mentioned in gross workings. Keep it in a separate input for OT wages. Secondly, you've mentioned 14000 to 18000, so probably as per ESI Act, the limit is less than Rs. 15000/- (Gross) to deduct. In case the employee's wage has been increased in the middle of the contribution period, it means "Apr to Sep" & "Oct to Mar", we have to deduct full wages (gross) that he earned or is earning until that contribution period is completed.
From India, Madras
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From India, Madras
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Dear Kanika,
The ESI ceiling is up to Rs. 15,000. You have to pay the ESI contribution on overtime as well, but should not consider it towards the ESI ceiling amount. If an employee crosses the ceiling amount of Rs. 15,000 before the next contribution period (from April to September and October to March), you have to deduct the contribution and pay accordingly. Washing Allowance (if you provide uniforms) and Conveyance (depending on the quantum) are exempted from ESI contribution.
Hope this clarifies your doubts.
G.K. Manjunath, Sr. Manager-HR
From India, Bangalore
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The ESI ceiling is up to Rs. 15,000. You have to pay the ESI contribution on overtime as well, but should not consider it towards the ESI ceiling amount. If an employee crosses the ceiling amount of Rs. 15,000 before the next contribution period (from April to September and October to March), you have to deduct the contribution and pay accordingly. Washing Allowance (if you provide uniforms) and Conveyance (depending on the quantum) are exempted from ESI contribution.
Hope this clarifies your doubts.
G.K. Manjunath, Sr. Manager-HR
From India, Bangalore
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Dear Kanika,
Please go through the attachment for the definition of "Wages/salary" for ESI. The ongoing ESI contribution should continue until the close of the half-year period if his salary has been increased to more than Rs. 15k in between. If his salary was increased before 1.9.12, then there is no need to continue from Sept.12. On the other hand, if his salary increased to more than Rs. 15k from 1.9.12, then you have to continue up to 31.3.2013 and discontinue thereafter. Is it clear?
For any clarification, you can check the ESI website or citeHR links where this subject was already discussed.
Regards,
Kumar S.
From India, Bangalore
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Please go through the attachment for the definition of "Wages/salary" for ESI. The ongoing ESI contribution should continue until the close of the half-year period if his salary has been increased to more than Rs. 15k in between. If his salary was increased before 1.9.12, then there is no need to continue from Sept.12. On the other hand, if his salary increased to more than Rs. 15k from 1.9.12, then you have to continue up to 31.3.2013 and discontinue thereafter. Is it clear?
For any clarification, you can check the ESI website or citeHR links where this subject was already discussed.
Regards,
Kumar S.
From India, Bangalore
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limits for esi is 15000/-, it is on gross wages but not deduct on washing allouws. if employer has provided dress. I think am i right, please seniors suggest me. regrads DSP
From India, Kolhapur
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From India, Kolhapur
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ESI Circular - New Salary ceiling of Rs. 15,000 effective May 1, 2010.pdf