Friends,
The Supreme Court, in its latest judgment dated 21.9.2017 (copy attached), has held that interim wages are also considered wages within the definition of wages given in the ESI Act. Therefore, ESI is applicable to interim wages as well. The court overturned the judgment of the Kerala High Court on this issue.
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From India, Malappuram
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1454The Supreme Court, in its latest judgment dated 21.9.2017 (copy attached), has held that interim wages are also considered wages within the definition of wages given in the ESI Act. Therefore, ESI is applicable to interim wages as well. The court overturned the judgment of the Kerala High Court on this issue.
Thanks
From India, Malappuram
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Hello,
You're correct. According to the recent judgment by the Supreme Court of India on September 21, 2017, interim wages are indeed considered wages under the definition given in the ESI Act. This means that the ESI is applicable to interim wages as well. This ruling reversed the previous judgment of the Kerala High Court on the issue.
👁️ Here are the practical implications of this ruling:
1. 🔢 If your company employs individuals on an interim basis, you will now need to calculate and pay ESI contributions based on their wages.
2. 📈 The calculation should be done in the same way as for regular employees. The wage amount should be multiplied by the current ESI contribution rate (employer's share at 4.75% and employee's share at 1.75%, totaling 6.5%).
3. 📆 Update your payroll system to ensure that ESI contributions are calculated correctly for interim wages. This may require working with your payroll provider or software vendor to make necessary adjustments.
4. 📊 Keep records of these contributions for compliance and audit purposes. You should also provide your interim employees with information about their ESI contributions.
5. 📰 To avoid any penalties for non-compliance, consider reviewing the ESI Act and the Supreme Court judgment to ensure your company's practices are in line with the law.
6. 🚨 If you have any doubts, consult with a legal expert or labor law consultant to understand the implications of this ruling in detail.
To sum up, interim wages are now considered wages under the ESI Act, and ESI contributions should be made accordingly. Be sure to update your payroll system, keep records, and consult a legal expert if needed.
🎉 Congratulations on staying updated with the latest legal developments and ensuring your company's compliance with labor laws.
From India, Gurugram
Acknowledge(0)Amend(0)
You're correct. According to the recent judgment by the Supreme Court of India on September 21, 2017, interim wages are indeed considered wages under the definition given in the ESI Act. This means that the ESI is applicable to interim wages as well. This ruling reversed the previous judgment of the Kerala High Court on the issue.
👁️ Here are the practical implications of this ruling:
1. 🔢 If your company employs individuals on an interim basis, you will now need to calculate and pay ESI contributions based on their wages.
2. 📈 The calculation should be done in the same way as for regular employees. The wage amount should be multiplied by the current ESI contribution rate (employer's share at 4.75% and employee's share at 1.75%, totaling 6.5%).
3. 📆 Update your payroll system to ensure that ESI contributions are calculated correctly for interim wages. This may require working with your payroll provider or software vendor to make necessary adjustments.
4. 📊 Keep records of these contributions for compliance and audit purposes. You should also provide your interim employees with information about their ESI contributions.
5. 📰 To avoid any penalties for non-compliance, consider reviewing the ESI Act and the Supreme Court judgment to ensure your company's practices are in line with the law.
6. 🚨 If you have any doubts, consult with a legal expert or labor law consultant to understand the implications of this ruling in detail.
To sum up, interim wages are now considered wages under the ESI Act, and ESI contributions should be made accordingly. Be sure to update your payroll system, keep records, and consult a legal expert if needed.
🎉 Congratulations on staying updated with the latest legal developments and ensuring your company's compliance with labor laws.
From India, Gurugram
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ESI applicable to software development companies - Bom HC 2012.pdf
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