Dear All,
Please let me know the following details regaring ESI for non skilled labourers in Tamil Nadu.
1. whether ESI is mandatory,if gross is less than Rs. 10000
2. If it is mandatory, what is the %?
3. whether it is calculated from gross or basic salary?
From India
4Please let me know the following details regaring ESI for non skilled labourers in Tamil Nadu.
1. whether ESI is mandatory,if gross is less than Rs. 10000
2. If it is mandatory, what is the %?
3. whether it is calculated from gross or basic salary?
From India
Hello Padmapriya
1)ESI is mandatory when an employees gross salary is less than Rs 10,000.
2)1.75%wil be the employees cont and 4.75 % wil be employers contribution on employers salary.
3) The following are deemed as wages.
• Basic pay
• Dearness allowance
• House rent allowance
• City compensatory allowance
• Overtime wages (but not to be taken into account for determining the coverage of an employee)
• Payment for day of rest
• Production incentive
• Bonus other than statutory bonus
• Night shift allowance
• Heat, Gas & Dust allowance
• Payment for unsubstituted holidays
• Meal/food allowance
• Suspension allowance
• Lay off compensation
• Children education allowance (not being reimbursement for actual tuition fee).
NOT to be deemed as wages
• Contribution paid by kthe employer to any pension/provident fund or under ESI Act.
• Sum paid to defray special expenses entailed by the nature of employment – Daily allowance paid for the period spent on tour.
• Gratuity payable on discharge.
• Pay in lieu of notice of retrenchment compensation
• Benefits paid under the ESI Scheme.
• Encashment of leave
• Payment of Inam which does not form part of the terms of employment.
• Washing allowance for livery
• Conveyance Amount towards reimbursement for duty related journey
For more queries please revert me.
Thanks
Manikandan.M
09939185120
From India, Ranchi
1)ESI is mandatory when an employees gross salary is less than Rs 10,000.
2)1.75%wil be the employees cont and 4.75 % wil be employers contribution on employers salary.
3) The following are deemed as wages.
• Basic pay
• Dearness allowance
• House rent allowance
• City compensatory allowance
• Overtime wages (but not to be taken into account for determining the coverage of an employee)
• Payment for day of rest
• Production incentive
• Bonus other than statutory bonus
• Night shift allowance
• Heat, Gas & Dust allowance
• Payment for unsubstituted holidays
• Meal/food allowance
• Suspension allowance
• Lay off compensation
• Children education allowance (not being reimbursement for actual tuition fee).
NOT to be deemed as wages
• Contribution paid by kthe employer to any pension/provident fund or under ESI Act.
• Sum paid to defray special expenses entailed by the nature of employment – Daily allowance paid for the period spent on tour.
• Gratuity payable on discharge.
• Pay in lieu of notice of retrenchment compensation
• Benefits paid under the ESI Scheme.
• Encashment of leave
• Payment of Inam which does not form part of the terms of employment.
• Washing allowance for livery
• Conveyance Amount towards reimbursement for duty related journey
For more queries please revert me.
Thanks
Manikandan.M
09939185120
From India, Ranchi
dear Ms. priya Yes ESI is mandotory for employee drawing below 10,000 even 10000 it is not calculated in basic salary and it mentioned clearly in another reply all the best
From India, Madras
From India, Madras
Hello Priya
I broadly agree with the two replies on the subject. Under ESI Act, there is no difference between skilled and unskilled, casual or regular etc. All employees, employed even for a single e day, and whatever may be nomenclature and status given to him are to be covered if remuneration paid in cash is Rs 10000 or below (excluding OT, which is to be taken only for paying contribution, and not for deciding coverage). All payment paid in cash is to be considered but anything paid in kind need not be taken. As for HR allowance, if payment of rent is made by Company directly to the house owner, though taken for an employee, at need not be taken. Similarly reimbursement of actual conveyance or transportation expenses need not be taken. Further production and productivity incentives and such payment made in periodicity of more than two month need not be taken to pay contribution.
Please also remember, the benefits available to employee covered under ESI scheme, in cash (for leave, maternity, accident related disability etc) will also be based on the wage on which contribution is paid, and since benefit rates have been revised upward, your employee will stand to benefit depending upon the actual rate of contribution paid. However, for medical care, the rate of contribution paid will not make any difference since all are treated equally for medical care.
Instead of bothering about nomenclature of different component of gross wage just remember " anything paid in cash in consideration of contract for employment is wage, anything paid in kind or paid addional to contractual obligation in periodicity of over two month is not wage, and reimbursement of specific purpose like washing allowance and actual conveyance is not wage".
The ESI Corporation Headquarters at Delhi, has been issuing specific instruction on the subject based on court judgements. Often the field officers and Inspectors may not be aware of the instructions and policy stand of their own department, and will seek contribution on wages not legally correct. Please use Right to Information Act to seek copies of policy instruction from ESIC HQ New Delhi.
O. Abdul Hameed
Formerly Additional Commissioner ESIC
From India, Coimbatore
I broadly agree with the two replies on the subject. Under ESI Act, there is no difference between skilled and unskilled, casual or regular etc. All employees, employed even for a single e day, and whatever may be nomenclature and status given to him are to be covered if remuneration paid in cash is Rs 10000 or below (excluding OT, which is to be taken only for paying contribution, and not for deciding coverage). All payment paid in cash is to be considered but anything paid in kind need not be taken. As for HR allowance, if payment of rent is made by Company directly to the house owner, though taken for an employee, at need not be taken. Similarly reimbursement of actual conveyance or transportation expenses need not be taken. Further production and productivity incentives and such payment made in periodicity of more than two month need not be taken to pay contribution.
Please also remember, the benefits available to employee covered under ESI scheme, in cash (for leave, maternity, accident related disability etc) will also be based on the wage on which contribution is paid, and since benefit rates have been revised upward, your employee will stand to benefit depending upon the actual rate of contribution paid. However, for medical care, the rate of contribution paid will not make any difference since all are treated equally for medical care.
Instead of bothering about nomenclature of different component of gross wage just remember " anything paid in cash in consideration of contract for employment is wage, anything paid in kind or paid addional to contractual obligation in periodicity of over two month is not wage, and reimbursement of specific purpose like washing allowance and actual conveyance is not wage".
The ESI Corporation Headquarters at Delhi, has been issuing specific instruction on the subject based on court judgements. Often the field officers and Inspectors may not be aware of the instructions and policy stand of their own department, and will seek contribution on wages not legally correct. Please use Right to Information Act to seek copies of policy instruction from ESIC HQ New Delhi.
O. Abdul Hameed
Formerly Additional Commissioner ESIC
From India, Coimbatore
My details:
Name : Saravanan Emp.Id No: 2141
DOJ: 26 July 2007
Date of Retired: 31 Aug 2008
Name of concern: Amnet Systems Pvt Ltd,Vellore 632 006.Tamilnadu.
Head Of Concern: Amnet Systems Pvt Ltd,Chennai-18..
Pf No: TN/49889/982
ESI No: 51-77319-66
Design: Team Member
Dept: E-resource
Total Contribution of ESI/PF: JULY 2007 TO AUG2008
Total ESI Amount : Rs.438.15paise
Total PF Amount : Rs 717.24paise
----------------
Not received : Rs.1155.39paise
- ----------------
What I do Next?
How did I get back these returns?
Who are the members' to contact these purposes...Address???
Anyone who likes to guide me?
Awaiting for your favourite reply
Bye
saravanan
vellore
oct30.2008
From India, Madras
Name : Saravanan Emp.Id No: 2141
DOJ: 26 July 2007
Date of Retired: 31 Aug 2008
Name of concern: Amnet Systems Pvt Ltd,Vellore 632 006.Tamilnadu.
Head Of Concern: Amnet Systems Pvt Ltd,Chennai-18..
Pf No: TN/49889/982
ESI No: 51-77319-66
Design: Team Member
Dept: E-resource
Total Contribution of ESI/PF: JULY 2007 TO AUG2008
Total ESI Amount : Rs.438.15paise
Total PF Amount : Rs 717.24paise
----------------
Not received : Rs.1155.39paise
- ----------------
What I do Next?
How did I get back these returns?
Who are the members' to contact these purposes...Address???
Anyone who likes to guide me?
Awaiting for your favourite reply
Bye
saravanan
vellore
oct30.2008
From India, Madras
Dear Sir
An employee is paid Rs. 14000/- salary in cash and Rs. 2000/- worth of "Sodexo" meal vouchers making the total monthly pay to Rs. 16000. Whether this employee is to be treated as "coverable" or "exempted" under ESI.
Also in a different case where the salary is 14000 of which cash part is 12000 and sodexho meal vouchers are given for the value of 2000. Whether we need to deduct and pay contribution on 12000 or 14000.
Sir kindly clarify, this has been a long pending doubt and I am unable to get a confident answer from my nearby sources.
Ramesh
From India, Madras
An employee is paid Rs. 14000/- salary in cash and Rs. 2000/- worth of "Sodexo" meal vouchers making the total monthly pay to Rs. 16000. Whether this employee is to be treated as "coverable" or "exempted" under ESI.
Also in a different case where the salary is 14000 of which cash part is 12000 and sodexho meal vouchers are given for the value of 2000. Whether we need to deduct and pay contribution on 12000 or 14000.
Sir kindly clarify, this has been a long pending doubt and I am unable to get a confident answer from my nearby sources.
Ramesh
From India, Madras
Dear Ramesh,
In my opinion, the meal vouchers should also be the part of the salary...simply say that it can be treated as 'meal allowance'. Hence the above employee can be treated as non coverable employee.........
From India, Hyderabad
In my opinion, the meal vouchers should also be the part of the salary...simply say that it can be treated as 'meal allowance'. Hence the above employee can be treated as non coverable employee.........
From India, Hyderabad
Dear V.S.P. gaaru
kindly refer to the post of Mr Hamid replying to a query raised by priya. Here in the 3rd para he has said..
anything paid in cash in consideration of contract for employment is wage, anything paid in kind or paid addional to contractual obligation in periodicity of over two month is not wage, and reimbursement of specific purpose like washing allowance and actual conveyance is not wage".
which means anything paid in kind cannot be treated as wages, since sodexo vouchers cannot be encashed. It can only be used to buy food. Therefore it can be concluded that it does not form "wages". So this derivation which also seems to hold good does confuse me. what is ur opinion ?
From India, Madras
kindly refer to the post of Mr Hamid replying to a query raised by priya. Here in the 3rd para he has said..
anything paid in cash in consideration of contract for employment is wage, anything paid in kind or paid addional to contractual obligation in periodicity of over two month is not wage, and reimbursement of specific purpose like washing allowance and actual conveyance is not wage".
which means anything paid in kind cannot be treated as wages, since sodexo vouchers cannot be encashed. It can only be used to buy food. Therefore it can be concluded that it does not form "wages". So this derivation which also seems to hold good does confuse me. what is ur opinion ?
From India, Madras
Dear ramesh,
As u said, if the employer is clearly giving in kind and as the vouchers can not be treated as 'paid in cash', i too can agree with ur version, i can agree with ur version 100% if and only if the employer has to establish as per his records, that:
i) this was paying other than their agreement;
ii)as a token of kind;
iii)the vouchers can not been encashed in any manner into cash.................
thank u for a nice discussion........
From India, Hyderabad
As u said, if the employer is clearly giving in kind and as the vouchers can not be treated as 'paid in cash', i too can agree with ur version, i can agree with ur version 100% if and only if the employer has to establish as per his records, that:
i) this was paying other than their agreement;
ii)as a token of kind;
iii)the vouchers can not been encashed in any manner into cash.................
thank u for a nice discussion........
From India, Hyderabad
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ESI contribution rates lowering.pdf