Dear All,
If there is firm in which 25 employee are working out of which 16 have gross salary less 15000/- and remaining have more than 20000/- so is ESIC applicable to that firm. Please suggest.

From India, Pune
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Yes ESIC is applicable in your case, since the count of employees has crossed 20, even though out of 25 employees 9 employees are out of range of ESIC salary bracket. Hope this clarifies your query
From India, Ahmadabad

In addition to Saji i also quote that ESIC is applicable under ur case as because 16 employees were having salary less than Rs. 15000/-, and for coverage only 10 employees were required.
Thanks & Regards,
Sumit Kumar Saxena

From India, Ghaziabad

For of implementation of ESI Act 20 employees working is enough. The salary criteria does not arise.
ESI coverage is belong to the salary range of Rs.15000 and below. As the total employees are above 25, the ESI is applicable to you. You have to extend the ESI facility to the persons drawing Rs.15000 and below even though the number of such persons is below 20.

From India, Hyderabad

Dear Mahesh,
Refer to your query, pl note the follwing. have not mentioned the firm under which category it follows.
2. It is applicable to Factories/Industries where 10 or more people working with power, 20 or more people working with out power i.e.applicable to Shops & Establishments, Private Educational Institutions& Dispensaries working on any day of preceding 12 months whose salaries/wages are below Rs.15,000/- per month.
Thanks & Regards,

From India, Hyderabad
Nila Maharana

Yes, ESIC is applicable this case .because 16 employees were having salary less than Rs. 15000/-, and for coverage only 20 employees were required. Nila Maharana 9920840453
From India, Mumbai

Dear, To know about above ESIC problem or more about ESIC. Kindly visit NATIONAL ACADEMY OF INDIAN PAYROLL or call 08080226688
From India

Dear All,
Thanks for the answers, but there are some HR persons whose opinion is for applicability of ESIC all twenty members should have gross salary less than 15000/- is it 100% true or not. In act also it is not clarified that applicability is related to gross salary criteria. If anybody of you have any supporting document regarding this so requesting you to please share it.

From India, Pune
Anjali S D

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From India, Pune
Harsh Kumar Mehta


With due regards to all members who contributed in this thread as above, I may humbly submit that the position of coverage under ESI Act,1948 as mentioned appears to be not clear. With due regards to all, I may sum-up the position as follows:-

1. Under said Act, the coverage is of two type of establishments namely-factories and establishments (some establishments as mentioned in the notifications). While coverage of factories is as per provisions of Section 1(3) of said Act, the coverage of establishments is under section 1(5) of the same.

2. After amendments in the said Act in the year 2010, in order to establish the coverage of a factory under said Act, the requirement is only of employment of 10 or more persons. The use of power for manufacturing process as well as minimum coverage of 10 or more persons (i.e. getting wages within wage ceiling) is no more required. If in any factory 10 persons are working and out of which only one person is getting wages within coverage limit ( presently upto and including Rs. 15000/), even then the factory is definitely coverable under said Act and principal employer is required to make compliance even for one person.

3. So far as coverage of establishments is concerned, the same is done after notification by the appropriate government and the State Govt. in respect of establishments other than Central Govt. establishments is the appropriate Govt. So far as I understand, a majority of State Governments ( except Maharashtra etc.) have now issued fresh notifications under said section bringing the coverage of specified establishments at par with the coverage of factories as under section 1(3) above.

4. However, in respect of areas of Pune or other implemented areas of Maharashtra and in respect of some other States, the position may be different because such State Govt. have not issued fresh notification under section 1(5) on the same pattern as per provisions of section 1(3). The position as to which of the State Govt. has issued fresh notifications after amendments in ESI Act, 1948 can be obtained from the respective Regional Offices of the ESIC. For example, the State Govt. of Gujarat has issued notification dated 03/01/2012 and Government of Anddhra Pradesh has issued such revised notification dated 21/04/2011.

5. Therefore, in my opinion, except some States like Maharashtra etc., such shops, hotels, restaurants etc. (which qualifies as specified establishments) which employ 10 or more persons regardless as to how many of them are getting wages below coverage limit as mentioned above are coverable under said Act. In such States, where fresh notifications have not been issued under section 1(5), the coverage of specified establishments will be as per notifications earlier issued by said Govts.

I will suggest to all members having interest on coverage under ESI Act, 1948 particularly officials working in HR sections of employers to kindly see the amended provisions of said Act, particularly the definition of factory under section 2(22) of said Act and also to ascertain the exact position of notification of State Govt, within their jurisdiction, if any, issued under section 1(5) of said Act before forming any opinion on the same. The present position in respect of areas like Pune situated in Maharashtra, can also be locally confirmed before any opinion is formed regarding coverage or otherwise of such units.

From India, Noida

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