Dear Sir,
My CTC is 7500.
And basic is 7143.
From my salary 125 (1.75% of 7143) is deducted and
356(4.75% of 7500) is included in my CTC hence
7500-356 = 7143 is my basic I receive..
Is above calculation right ?
And now my salary will be 10500 Rs. So
Please tell me Will I be exempted from ESIC deduction or not ?
One other question.. I am giving 1.75% of my salary to be benefited and 4.75% is also deducted from my salary.
Why should company benefited even though both contribution are done from my salary ?
Please reply me as I am very confused with this ..
U can also mail me on
Thanks in advance...

From India, Ahmadabad
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Jitendra Tomar

This is not the way to calculate ctc
If Y salary in ctc Rs 7500 .
ony 1.75% will be deducted in your salary other 4.75% will be given be Employer
and your (gross or basic) salry will be Rs 7368
Any problem
pls contract
Jitendra Tomar

From India, Ghaziabad

Hi Thanks
Ur number is not working
I am still confused..I am giving my details as per salary slip
My CTC is 7500/ month
My Basic is 7143
Deduction is : PT : 80
GMC : 530
ESIC : 125 (1.75% OF 7143)
My Net : Basic - (PT+GMC+ESIC) I.e
7143 - (80+530+125) = 6408
Is above calculation right ?
They give CTC structure as
7143+356(4.75% of 7500) = 7500 /month
but both deduction are done from my salary..
1.75% is deducted from my basic and 4.75% is included in CTC.
I seem something wrong..
Please help me

From India, Ahmadabad

dear ketan,
u r totally under wrong calculation, ctc is cost to company basis like basic, hra, ca, da,cca,medi.allow,leave travel exp,bonus, pf including every thing which u have benefitted. so esi deduction will be deducted on gross salary only not from ctc amount. suppose ur gross salary is Rs.12,000/- then ur esi share deduction from ur gross salary is Rs.210/- (1.75%) then employer share is Rs.570/-.
Note: the ESIC wage limit is increased 10 to 15k from 01.05.2010

From India, Hyderabad

Thanks Devi.
As per ur example
In my case what is happening
1.75% of basic , I am paying..
and 4.75% of CTC is also getting deducted from my salary..
They have added gross+Employer's ESIC(4.75%) and made my CTC
e.g. : Basic+Employer's ESIC = CTC..
As per ur comment. I have to pay only 1.25% of gross only na?
Am I right?
but right now From my salary structure is
CTC: 7500
BASIC : 7143 -----> (7500-356) (356 = 4.75% Empl.ESIC)
DEDUCTION : 125 (1.75 % OF Employee contribution)
This is wrong na?
Ultimately , I am paying both 1.75% and 4.75%
And Limit is calcualated on basic(gross) or CTC?
Please reply me....
Thanks in advance........

From India, Ahmadabad

Dear Ketan
As explained to you by other seniors, CTC means cost to company.
That is to say cost which company incurrs for an employee.
As per ESIC Rules, Total ESIC deduction is 6.5% of which 1.75% is employees' share & 4.75% is employer's share. Both these amts. are cost to company. Hence it is considered in your CTC ( Cost to company ).
Similar case is of PF( 12% each from Employee & Employer )
Hope it clears your doubt now.

From India, Mumbai

As your Salary is above 10,000/- mark you are currently exempted from ESI contribution. Please wait. Now, the exemption limit of ESI has been increased from Rs.10,000/ - to Rs.15,000/-. The date of implementation is not yet known, but it is likely to be from 01.04.2010. That being the case, you will be under ESI liable for contribution at the rate of 1.75% of your gross salary.

From India, Madras
Dear Ketan,
The ESI has enhanced the wage limit under the ACt from 10000/- to 150000/- w.e.f. May 1, 2010. So you will need to pay the ESI contribution.
ESI is attempting to improve its image but the performance has been far from satisfactory. If an employee can contribute the same amount that he pays under the ESIC, he could take a better medical coverage under any general insurance company.
It is time that employers impressed the government on the performance of this white elephant...

Prithvi Pal Singh

My dear friends,
According to notification dated 20th April 2010 issued by Ministry of Labour and Employment coverage under Employees’ State Insurance (Central) (Amendment) Rules 2010 is being increased from Rs. 10,000/- to Rs. 15,000/-.
This shall come into force from the 1st day of May, 2010.
(& not from 1st April 2010).
This means ESIC amount will be deducted from May 2010 wages & to be paid in June 2010.
(Kindly note first payment as per new scheme will be in the month of June 2010 & not in May 2010.)
Copy of Notification attached herewith for your reference.
Prithvi Pal Singh

From India, Mumbai

Attached Files (Download Requires Membership)
File Type: pdf New ESIC Notification.pdf (1.67 MB, 1238 views)


Dear Ketan,

Please do not confuse between salary and CTC. As has been brought out that CTC is cost to company which means how much you are costing to the company. This includes Basic Pay, HRA, Food subsidy (if any), conveyance (if provided), Employer's contribution to PF, Employer's contribution to ESI and any other money which the company is incurring on you.

As per Employee's State Insurance act, the employee's share is 1.75% of Basic pay and the employer's share is 4.75% of basic pay.

In your case basic pay has been fixed at Rs 7143/- All other allces mentioned above which constitute CTC are additional. The employer's share of ESI is CTC but it is notionalk as this is not to be paid to the employere in cash. This has to be deposited with ESI authorities. You will get the benefits of ESI based on your contribution i.e. 1.75% of your basic salary and the employer's contribution which is 4.75% of your basic salary.

The calculation by the company is correct.

I hope this clears the confusion.


From India, New Delhi

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