Dear All, Please help me understand how to calculate ESIC...? IS it on the Basic salary or on the Gross amount ?? Regards Bhavna
From India, Delhi
Hi Bhavna.
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.
Hope it might have helped you to understand the same..
Amit Seth

From India, Ahmadabad
Hi Amit
Just want to clear is this amount payable or its just to avail medical benefits as I could see our organisation pay employee 2400perannum as additional allowance in the form of ESi .

From India, Gurgaon
Hi Deepa,

Its not there that under this Act only Medical benefit is provided, apart from this some more benefits are also provided, which are as below-

1. Sickness Benefit: Every insured employee is entitled to the cash benefit for the period of sickness, certified by a duly appointed medical practitioner.

2. Maternity Benefit: A cash benefit is payable to an insured woman employee, in case of miscarriage, medical termination of pregnancy, sickness arising from the pregnancy.

3. Disablement Benefit: It is also been paid in form of cash to an employee who is injured in an accident during the course of his employment.

4. Dependent's Benefit: If nay employee dies as a result of any injury, his dependents shall be entitled to a benefit in the form of pension.

5. Medical Benefit:

6. Funeral Expenses

7. Payment of benefit in case of death.

Moreover, it is the rule that if your company is covered under this Act, then you have to be with the rules, and it is required to register the company under this Act.


Amit Seth.

From India, Ahmadabad
Thank You Amit SAAB
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M. Peer Mohamed Sardhar
093831 93832

From India, Coimbatore
Hi Amit,
Just wanted to get clarified on one thing is ESI calculated on Gross or Total Earnings of an Employee. And according to me if his/her limit cross 10,000 in between the Half year term than also he should to be covered till that particular period is finished, correct me if i am wrong.
I would like to be in touch with ur are of great help on my first day in this site.
Amith R.

From India, Bangalore
ESI Contribution is payable on the Gross Salary. The rate of contribution is 1.75% & 4.75% for employees & employer respectively. The wage limit for ESI Contribution is Rs. 10,000/- PM.
Amit Kumar Tawar

From India, Mundra
Hi Amith,
ESI is calculated on the basis of Gross salary/month.
Regarding the second part, i'm not that much sure.. but in my view also you are bit correct, he remain covered under the Act till that benefit period..
Thank you so much, you are always welcome...
Amit Seth.

From India, Ahmadabad
Hi All,
What amit says it valid.. an employee will remained covered for the deduction till the end of the six monthly contribution period.
You can even check with the corresponding benefit period for the ESI benefits to the employees.

From India, Mumbai
Esi is caluculated on Basic + D.A. + All Allowances ( eg - Hra, Conv, O.T. ect ) + any other kind of earnings = Gross Amt.
It is diveded into two shares 1.75% that is employee share and 4.75% employer share total 6.5 %.
All employee who has their Gross Salary 10000 or less has to give their contribution towards ESI as 10000 is the celing for esi frm 1 oct 2006.
Now when u calculate it if some Amount comes in decimals you have to round it of to next rupee eg - if say Rs 45.3 it will be taken as Rs 46.

From India, Delhi

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