Dear All,
We are in the service industry and we have a total staff of 11 employees, out of which 10 have gross salaries higher than 21,000, and 1 employee has a gross salary below 21,000 and joined this month only.
Kindly advise, do we need to have ESIC registration if this employee's salary crosses 21,000, or is it mandatory to register regardless?
Thank you.
From India, Ahmedabad
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We are in the service industry and we have a total staff of 11 employees, out of which 10 have gross salaries higher than 21,000, and 1 employee has a gross salary below 21,000 and joined this month only.
Kindly advise, do we need to have ESIC registration if this employee's salary crosses 21,000, or is it mandatory to register regardless?
Thank you.
From India, Ahmedabad
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Yes, it's applicable, pl.read the applicability clause reproduced herein -
The ESI Act, 1948 is applicable to all factories and notified establishments in an implemented area employing 10 or more employees employed for wages.
a) For Factory:
The threshold for coverage of “factory”, as per section 2(12) of the ESIC Act is 10 which are located in implemented areas. At present the Act is extended to 529 Districts (as per list available on ESIC website at https://www.esic.nic.in/coverage)
b) For Establishments:-
i) Central Govt. has extended the coverage to following establishments, for which it is the appropriate Government, by way of a notification under section 1(5):-
Shops, Hotels, Restaurants, Road Transport Establishment, Cinema including preview theaters, Newspaper Establishment & Establishment engaged in Insurance Business, Non Banking Financial Companies, Port Trust, Airport Authorities and Warehousing establishments.
ii) State Govts. have also extended the coverage to following establishments:-
Shops, Hotels, Restaurants, Cinema including preview theaters, Road Motor Transport Undertakings, Newspaper Establishments, Educational Institutions (27 States/UTs), Medical Institutions (27 States/UTs) and Municipal Corporation/Municipal bodies employing 10 or more employees.
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For the purpose of regn.requirements wages drawn by the employees whether more or less or threshold limit of Rs.21ooo/- is not relevant.
Amendments issued if any, issued from time to time will apply.
From India, Bangalore
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1273The ESI Act, 1948 is applicable to all factories and notified establishments in an implemented area employing 10 or more employees employed for wages.
a) For Factory:
The threshold for coverage of “factory”, as per section 2(12) of the ESIC Act is 10 which are located in implemented areas. At present the Act is extended to 529 Districts (as per list available on ESIC website at https://www.esic.nic.in/coverage)
b) For Establishments:-
i) Central Govt. has extended the coverage to following establishments, for which it is the appropriate Government, by way of a notification under section 1(5):-
Shops, Hotels, Restaurants, Road Transport Establishment, Cinema including preview theaters, Newspaper Establishment & Establishment engaged in Insurance Business, Non Banking Financial Companies, Port Trust, Airport Authorities and Warehousing establishments.
ii) State Govts. have also extended the coverage to following establishments:-
Shops, Hotels, Restaurants, Cinema including preview theaters, Road Motor Transport Undertakings, Newspaper Establishments, Educational Institutions (27 States/UTs), Medical Institutions (27 States/UTs) and Municipal Corporation/Municipal bodies employing 10 or more employees.
---------
For the purpose of regn.requirements wages drawn by the employees whether more or less or threshold limit of Rs.21ooo/- is not relevant.
Amendments issued if any, issued from time to time will apply.
From India, Bangalore
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Hi Vinay, If that employee’s gross is more or less nearing 21k increase it slightly so as to cross 21 k so that employer and employee contribution payment is not needed.
From India, Madras
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From India, Madras
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Hi,
As per the ESIC Act amendment, it is mandatory to register under ESIC if the employee strength of a company is above 10 and the employee gross is below 21,000. For assistance in the registration of ESIC and complying with all labor laws, you can contact me.
Regards,
KM, Consultant - Labor and HR Compliance 7708907021
From India, Bengaluru
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As per the ESIC Act amendment, it is mandatory to register under ESIC if the employee strength of a company is above 10 and the employee gross is below 21,000. For assistance in the registration of ESIC and complying with all labor laws, you can contact me.
Regards,
KM, Consultant - Labor and HR Compliance 7708907021
From India, Bengaluru
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if after appraisal gross salary Exceeds 21K slab for deduction, can the deduction be stopped with immediate effect even if the ESIC deduction cycle(1st Oct’19 to 31st Mar’20) already started .i.e. if we deposit ESIC for the month of Oct’19. How a person can be compensated.
Will he get the deducted amount back if he not remain in the deduction slab from April 1st 2019 onwards.
From India, Mohali
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Will he get the deducted amount back if he not remain in the deduction slab from April 1st 2019 onwards.
From India, Mohali
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Hi,
As you are aware, the contribution period and benefit period are as follows:
Contribution period: Corresponding Benefit period
1st April to 30th Sept. - 1st January to 30th June of the following year
1st Oct. to 31st March - 1st July to 31st December of the year following
Since deduction/contribution has already commenced, it's not advisable to stop the deduction. On the other hand, if your contribution continues, you will receive the benefits during the benefit period, i.e., 1st July to 31st Dec. forthcoming, notwithstanding the fact that your salary exceeded the coverable limit. There is no possibility of any refund on the plea that your 'salary' has crossed the threshold limit of Rs. 21,000 but you are entitled to ESI benefits.
From India, Bangalore
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As you are aware, the contribution period and benefit period are as follows:
Contribution period: Corresponding Benefit period
1st April to 30th Sept. - 1st January to 30th June of the following year
1st Oct. to 31st March - 1st July to 31st December of the year following
Since deduction/contribution has already commenced, it's not advisable to stop the deduction. On the other hand, if your contribution continues, you will receive the benefits during the benefit period, i.e., 1st July to 31st Dec. forthcoming, notwithstanding the fact that your salary exceeded the coverable limit. There is no possibility of any refund on the plea that your 'salary' has crossed the threshold limit of Rs. 21,000 but you are entitled to ESI benefits.
From India, Bangalore
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Gross Salary(1).xls