I have a query.
I work in the public sector. In my plant, we have a few employees whose gross salary is lower than 15000, i.e., they fall under the purview of ESI. The remaining employees are not covered as they have higher salaries.
The issue arises when the gross salary of an employee is 14000, and we pay for their ESI contribution as per the ESI Act. However, after a wage revision in May, their salary increases to 18000. They automatically move out of coverage, but according to the law, we must contribute until the end of the contributory period, i.e., October.
Now, due to absenteeism, the employee withdraws a gross amount of 14000 in July, resulting in a net pay of around 13500. Will this employee come back under the purview of ESI if their salary drops below 15k? Does the monthly fluctuation in salary due to absenteeism affect this situation? My question is, once the gross salary crosses 15k, can the employee return under ESI if their salary falls below 15k for a respective month due to absence? Please provide me with the section in the ESI Act where this is specified.
Another case is...
We pay statutory bonus at 8.33% in the month of October. All employees have a basic salary + DA of around 25k. Therefore, they do not fall under the Bonus Act, as the basic salary + DA is higher than 10k. Now, suppose an employee works for only 5 days in a month due to sickness or domestic issues and withdraws a salary of 9k. Would I still need to pay them a bonus for those months? Bonuses in our plant are paid annually, i.e., 8.33% of 3500 multiplied by 12.
So, if someone receives a lower salary for any month, would they then come under the Bonus Act? Which section defines this? Can anyone assist with this information?
From India, Calcutta
Acknowledge(0)
Amend(0)
114I work in the public sector. In my plant, we have a few employees whose gross salary is lower than 15000, i.e., they fall under the purview of ESI. The remaining employees are not covered as they have higher salaries.
The issue arises when the gross salary of an employee is 14000, and we pay for their ESI contribution as per the ESI Act. However, after a wage revision in May, their salary increases to 18000. They automatically move out of coverage, but according to the law, we must contribute until the end of the contributory period, i.e., October.
Now, due to absenteeism, the employee withdraws a gross amount of 14000 in July, resulting in a net pay of around 13500. Will this employee come back under the purview of ESI if their salary drops below 15k? Does the monthly fluctuation in salary due to absenteeism affect this situation? My question is, once the gross salary crosses 15k, can the employee return under ESI if their salary falls below 15k for a respective month due to absence? Please provide me with the section in the ESI Act where this is specified.
Another case is...
We pay statutory bonus at 8.33% in the month of October. All employees have a basic salary + DA of around 25k. Therefore, they do not fall under the Bonus Act, as the basic salary + DA is higher than 10k. Now, suppose an employee works for only 5 days in a month due to sickness or domestic issues and withdraws a salary of 9k. Would I still need to pay them a bonus for those months? Bonuses in our plant are paid annually, i.e., 8.33% of 3500 multiplied by 12.
So, if someone receives a lower salary for any month, would they then come under the Bonus Act? Which section defines this? Can anyone assist with this information?
From India, Calcutta
Acknowledge(0)Amend(0)
In both cases, you have to consider the nominal wages, which is the salary he would have earned if he had worked for 30/31 days. Therefore, if an employee outside ESI coverage earns a lower salary due to unpaid leave, he will not fall under ESI for that specific month. Similarly, if a covered employee earns more than Rs 15,000 in any month through additional work and overtime payments, they will still remain under ESI coverage. (The ESI qualifying salary is set to increase to Rs 25,000, as announced by the Government.)
Similarly, you must calculate the eligibility for a bonus based on the actual salary rather than the salary earned. Therefore, if the regular wages exceed Rs 10,000 during the year, the bonus will be paid until the month in which the salary remained at Rs 10,000 or less. Any decrease in the actual salary earned will not be considered.
Madhu.T.K
From India, Kannur
Acknowledge(0)Amend(0)
Similarly, you must calculate the eligibility for a bonus based on the actual salary rather than the salary earned. Therefore, if the regular wages exceed Rs 10,000 during the year, the bonus will be paid until the month in which the salary remained at Rs 10,000 or less. Any decrease in the actual salary earned will not be considered.
Madhu.T.K
From India, Kannur
Acknowledge(0)Amend(0)
Hello,
These employees are monthly rated, and the salary is fixed for a month. The ESI and Bonus Acts refer to monthly salary/wages; therefore, daily rate counts are meaningless. Both Acts apply to monthly salary, not daily.
Thanks,
Mritunjay Nath Sahu GM (HR)
From India, Vadodara
Acknowledge(0)Amend(0)
These employees are monthly rated, and the salary is fixed for a month. The ESI and Bonus Acts refer to monthly salary/wages; therefore, daily rate counts are meaningless. Both Acts apply to monthly salary, not daily.
Thanks,
Mritunjay Nath Sahu GM (HR)
From India, Vadodara
Acknowledge(0)Amend(0)Engage with peers to discuss and resolve work and business challenges collaboratively - share and document your knowledge. Our AI-powered platform, features real-time fact-checking, peer reviews, and an extensive historical knowledge base. - Join & Be Part Of Our Community.
WORK PLACE STANDARDS - Blank.doc
06b-Form VI-B (Notice of Commencement of Contract Work).pdf
Work-life_balan ce_117.ppt