Human Resources Management
Talent Acquisition Manager
Amith R Murthy
Hr Executive
Personnel Incharge
Amar Chauhan
Pg Student
+1 Other

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Hi Bhavna,
Yes you need to take the Incentives the account, because according to me ESI is always calculated based on the total earnings. And you need to deduct ESI until teh completion on going 6months period.
Members correct me if i am wrong................
Amith R.

From India, Bangalore
Hi All,
I have few queries related to ESIC calculation. I am citing a case to explain the situation and understand the solutions well.
An employee is at a gross salary of 8000/- and is thus liable for ESIC deduction. During the year he receives incentive worth Rs. 1,500/- and after few months an increment of Rs. 4,000/-. Now his gross salary becomes Rs. 12,000/-.
Following are the queries:
1. While calculating ESIC deduction, will incentives be considered?
2. After increment, though he is not eligible for ESIC deduction but as the 6 monthly contribution has to go on, the deduction will be calculated on which amount.....8,000/- or 10,000/- or 12,000/- ?????
Please help.

From India, Delhi
The employer and employee should contribute towards ESIC @ Rs. 12000.
For more information on ESIC and what constitutes wages please read the attached file.
warm regards,
Umesh Chaudhary
([email protected])

From India, Delhi

Attached Files
File Type: pdf wages_under_esic_100.pdf (53.4 KB, 621 views)

Hi Bhavana
The incentive amount has to be included in the gross earnings for ESI calculations. Eventhough the gross income crosses the ceiling of Rs.10000/- the ESI should be deducted till the end of the contribution period for the gross earnings.
members! please tell me if i am wrong.
warm regards

From India, Coimbatore
the simple answer to your query is that the amount on which he was getting the contribution, only that amount should be considered because if consider the entire amount then it will like that you are not considering the law. So only consider the previous amount on which he was getting the contribution.
Sorry if i am wrong, but i am right best to my knowledge.
Amar Chauhan

Hi Bhavna,
Even after the increment you need to calculate ESI on the total earnings only it doesn't change and i mentioned in my earlier post you need to do it until the completion on the ongoing 6 months period. I hope is it clear now...........
Umesh thanks a lot it is very informative. Keep posting..........
Amith R.

From India, Bangalore
Hi my salary hikes 16000 in July 2016.... now esic wage limit increases to 21000.... am i eligibility for esic maternity benefit in Dec 2016....
From India, Jaggayyapeta
Hi my delivery date is in Dec 2016... I have 9 yrs experience in my institution.... Which contribution period will check for benefit period .....?
From India, Jaggayyapeta
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