Dear All,
Greetings of the day! Hope you all are fine. As all of you are aware of the epidemic affecting the nation, our Management has decided to reduce the salary of all employees during this period instead of laying off employees. This is a commendable decision. However, I have a question - what will happen to those employees whose gross salary will be reduced to less than or equal to Rs. 21,000? Will they become members of ESIC contribution or not? Previously, they were not members of ESIC due to their higher salary.
Seeking guidance, please help.
From India, Rudarpur
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96Greetings of the day! Hope you all are fine. As all of you are aware of the epidemic affecting the nation, our Management has decided to reduce the salary of all employees during this period instead of laying off employees. This is a commendable decision. However, I have a question - what will happen to those employees whose gross salary will be reduced to less than or equal to Rs. 21,000? Will they become members of ESIC contribution or not? Previously, they were not members of ESIC due to their higher salary.
Seeking guidance, please help.
From India, Rudarpur
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ESIC Coverage for Employees with Reduced Salary
In the scenario where employees' gross salary is reduced to less than or equal to Rs. 21,000 due to the current salary reduction measures implemented by the Management in response to the COVID-19 situation, the implications on their ESIC membership need to be considered.
Here are the key points to address this situation:
1. ESIC Eligibility Criteria: Employees with a gross salary of up to Rs. 21,000 are eligible for ESIC coverage under the Employees' State Insurance Corporation (ESIC) Act, 1948. Therefore, if the salary reduction brings their gross salary within this threshold, they would become eligible for ESIC membership.
2. Impact on ESIC Contribution: Once the employees' gross salary falls below Rs. 21,000, they would be required to contribute towards ESIC as per the applicable rates. Both the employer and the employee have to make contributions to the ESIC fund based on the salary slab.
3. Registration Process: The employer would need to ensure that these employees are registered under ESIC and the necessary contributions are made from both the employer's and employee's end. It is essential to comply with the registration formalities to avoid any legal implications.
4. Benefits of ESIC: ESIC provides various benefits to employees, including medical, maternity, disability, and dependent benefits. By becoming members of ESIC, employees can avail themselves of these benefits in times of need.
5. Compliance and Documentation: It is crucial for the employer to maintain accurate records of ESIC contributions for all eligible employees. Compliance with ESIC regulations is essential to ensure the well-being of employees and avoid any penalties for non-compliance.
In conclusion, if the salary reduction results in employees' gross salary falling below Rs. 21,000, they would be eligible for ESIC coverage, and both the employer and employees need to adhere to the ESIC regulations regarding contributions and benefits.
For further details or specific queries related to ESIC contributions and coverage, it is advisable to consult the official ESIC guidelines or seek guidance from a legal or HR expert well-versed in Indian labor laws and ESIC regulations.
From India, Gurugram
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In the scenario where employees' gross salary is reduced to less than or equal to Rs. 21,000 due to the current salary reduction measures implemented by the Management in response to the COVID-19 situation, the implications on their ESIC membership need to be considered.
Here are the key points to address this situation:
1. ESIC Eligibility Criteria: Employees with a gross salary of up to Rs. 21,000 are eligible for ESIC coverage under the Employees' State Insurance Corporation (ESIC) Act, 1948. Therefore, if the salary reduction brings their gross salary within this threshold, they would become eligible for ESIC membership.
2. Impact on ESIC Contribution: Once the employees' gross salary falls below Rs. 21,000, they would be required to contribute towards ESIC as per the applicable rates. Both the employer and the employee have to make contributions to the ESIC fund based on the salary slab.
3. Registration Process: The employer would need to ensure that these employees are registered under ESIC and the necessary contributions are made from both the employer's and employee's end. It is essential to comply with the registration formalities to avoid any legal implications.
4. Benefits of ESIC: ESIC provides various benefits to employees, including medical, maternity, disability, and dependent benefits. By becoming members of ESIC, employees can avail themselves of these benefits in times of need.
5. Compliance and Documentation: It is crucial for the employer to maintain accurate records of ESIC contributions for all eligible employees. Compliance with ESIC regulations is essential to ensure the well-being of employees and avoid any penalties for non-compliance.
In conclusion, if the salary reduction results in employees' gross salary falling below Rs. 21,000, they would be eligible for ESIC coverage, and both the employer and employees need to adhere to the ESIC regulations regarding contributions and benefits.
For further details or specific queries related to ESIC contributions and coverage, it is advisable to consult the official ESIC guidelines or seek guidance from a legal or HR expert well-versed in Indian labor laws and ESIC regulations.
From India, Gurugram
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Official gazatte notification for revision of ESIC contribution reduction July 2019 (1).pdf
Copy of Salary Template esic.xls
Salary-Note.doc