You need to learn more on PF & ESI.
PF Wages means Basic + DA+ Food subsidy+leave encashment(if paid). On PF wages, employee contribute 12% and employer also contributed 12%. The employer contribution splited into PF 3.67% and Pension 8.33%. The PF wages ceiling upto Rs.6500/-.
ESIC wages means basic+DA+allowances+overtime. But Conveyance should not considered. the ESI revised limit Rs.10,000/-. the employee contributed 1.75% and employer contributed 4.75% on total ESI wages.
The minimum wages also attract to ESI deduction.
Can anybody clarify my following queries:
1) How do calculate monthly salary of Rs.15000/- in case of daily rate wages, what is the rule applicable for absenteeism. For eg. if a person work 30/31 days in a month he will exceed the monthly salary of Rs.15000/- if he/she absent for even one day his salary will be below Rs.15000/-. In such case whether he/she is eligible for ESIC deduction or not.
2) A employee is de-covered from ESIC Coverage in the month of October-12 to January-13 as his salary was more than 15000/- but in the month Feb-13 he gets only 28 days salary which is less than 15000/-. What is the rules applicable as per ESIC Act.1948. Whether employee will be recovered for ESIC deduction or not?
Sudhakar M. Acharya
My question is " for daily rated wage system" i.e.
1) How to treat absenteeism while calculating ESIC salary of Rs.15000/- for example Workman A worked for 31 days in Jan-13 and got a monthly salary of Rs.15500/- and workman B woked only 28 days he got a salary of Rs. 14000/- only. In such case the workman B is eligible for EISC Deduction. In my view he should be de-covered from ESIC as if he had woked for 31 days his salary would be Rs..15500/-
2) Similary in the month Feb-13 e.g. The workman A will get only 28 days salary i.e. Rs.14000/- which below Rs.15000/- whether this workman A is eligible for ESIC deductions?
Nothing has been mentioned in the Act. The act says the eligible salary per month for ESIC deduction is Rs.15000/-
Sudhakar M. Acharya.
Thank very much for the information. but sir, my query is totally different.
I know the eligibility salary for ESIC is Rs.15000/- and the contribution period is April to Sept. & Oct. to Mar.
Even if an worker once covered in the month April or Oct. irrespective of wages, whether it is more than 15000/- or less than that, employer should deduct the ESIC. Here, there is no issues for those monthly paid workers.
But the issues is here, we are paying our workers on daily basis i.e. they will get the wages for no. of days worked in a month. If an worker work for full month days i.e. 26 days (excluding Sundays) he will get a wages of more than 15000/- and eventually he will be out of esic. However, if a worker absent for 2 days and if he gets only 24 days wages then his wages will be below 15000/- My question is how to treat such worker, are the employer bound to deduct ESIC of this worker? or he will be out of ESI coverage as if he had have worked for 26 days his salary would be more than 15000/-.
Also since October -12 to January-13 most of our workers are getting more than 15000/- wages as they work 26/27 days (Excluding Sundays) they were out of ESIC. But in this month i.e. Feb-13 having only 28 days and the worker will get wages of 24 days only and their wages will be less than 15000/- wages only. Here also my question is, Are they recovered for ESIC or not?
Kindly advise me.
Sudhakar M. Acharya