ESI is contributed from both the sides Employee as well as Employer.
It is been calculated on the basis of Gross salary per month and the maximum ceiling is 10000 Rs./Month.
The contribution from both the sides is as below-
Employee Side- 1.75% of gross/month
So if gross of an employee is 8000/month then
ESI contribution would be 8000*1.75% = 140 Rupees
Employer side- 4.75% of gross/month
ESI contribution would be 8000* 4.75% = 380 Rupees.
Whereas, PF is also been paid from both the sides.. Both the employer as well as employee is required to pay the 12% of basic salary..
Out of this 12% of employer's contribution 8.33% goes to Pension fund whereas rest 3.67% goes to the PF Fund itself..
PF is deducted on Basic salary i.e Basic + DA is Rs. 6500/- or less above that PF is not deducted.
1) Employee – 12 % (of Basic + DA & Food concession allowance & retaining allowance, if any)
2) Employer – 13.61 % (of Basic + DA & Food concession allowance & retaining allowance, if any)
[ 13.61 % = 3.67 % PF + 8.33 % Pension Scheme + 1.10 % Admin. Charges of PF + 0.5 % EDLI + 0.01 % Admin Charges of EDLI ]
EDLI - Employee deposit link insurance
Here this PF is normally deducted from the basic & DA ( dearness allowance )
Such that Basic salary - 35%
DA - 15% outof gross salary.
For (e.g) - If the gross salary of a person is Rs.9000/-p.m
Basic- 35% @ 9000 - 3150
DA - 15% @ 9000 - 1350
Such that the total amount would be deducted @ 12% (i.e) PF - 540/-
The maximum ceiling limit of PF - Rs.6500/-
If the basic + DA exceeds 6500/- than the contributions is optional. Some company may have their own company policies.
Provident fund is calculated towards the employers is 13.61%
1. Employers Contribution
2.EPF A/c No.1 - 3.67%
3.EPF - Admn Charges - 1.1%
4.Pension Fund A/c No.10 - 8.33%
5.EDLI A/c No.21 - 0.5%
6.EDLI - Admn Charges - 0.01%
In this ESIC, it includes the medical benefit both for the employee and employer.
It has been calculated on the basic of gross pay per month and maximum limit is upto Rs.10000/- p.m
Employee side - 1.75% and Employer side - 4.75%.
So if the gross of an employee is 8000/- p.m his contribution would be 8000*1.75% = 140/-
Employer 8000*4.75% = 380/-
Therefore Net pay = Gross pay - Total deductions
1. Those who are getting 10000/- gross per month will not be applicable under ESIC act.
2. 20 eligible employees to get registered in ESIC
3. Eligible employees means those who are getting gross pay upto 10000/- or less per month.
Apart from that there is a tax deduction., it includes the Income & professional tax.
CTC means cost to the company.i.e .what are all the expenses incurred by the Company for any of its employee for a particular period(monthly/yearly)
gross pay + employers pf+employers ESI + bonus = CTC
i.e THE SALARY PAYABLE AND OTHER STATUTORY BENIFTS PAYABLE BY COMPANY.
CTC is cost to company and the components are
+employer cotri of PF
+Employer Cotri towards ESI
+Total variable incentives
+Perks & benefits
+ insurance Premium (in case of Group insurance)
t is been deposited @ 4.81% of Basic per month..
After completing 5 years of service one may claim Gratuity at the time of separation from the organisation and it is been paid @ 15 days of salary for per year of service...
Like for 6 years of experience one's gratuity will be calculated with this formula-
Hope this will be useful for you. If you ve any other clarification pls do visit
EPF : www.epfindia.com
ESIC : www.esic.nic.in
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