Employees' State Insurance (Central) Ammendment Rule, 2016 & New Area Under ESIC & Contribution - CiteHR
Industrial Relations And Labour Laws
Harsh Kumar Mehta
Consultant In Labour Laws/hr
Labour Law Advisor
+1 Other

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Dear All,
Please find attached new notification from ESI dated 25th July, 2016 Employees' State Insurance (Central) Amendment Rule, 2016 & list of new area included in Maharashtra, Rajasthan & Bihar
Employees' State Insurance (Central) Amendment Rule, 2016 states about draft rules for ESI revised rates to new ESI implementing area for the first time under the purview of ESI Act.
a) Rule 51-(A) Shall be renumbered as rule "51A"
Its says - In Area where the Act is implemented for the first time, the rate of employers' & employees, contribution for the initial twenty-four moth shall be as under:-
a) Employer Contribution:- 3% of ESIC Wage
b) Employee Contribution :- 1% of ESIC Wage
please find the link below
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Dear Rahul Kumar, From which date this amendment is in force to the all and the rate of contribution is decreased form 6.5 to 4 ?
There is no reduction in the rates of contribution for existing establishments. The rule is for establishments in an area which is newly brought under ESI by notification. As you know that ESI is not applicable to the entire India but there are areas where the scheme is not implemented. ESIC can notify such areas as ESI notified areas and accordingly many areas are being notified as ESI covered areas. When a place is notified as ESI covered area the establishments in such areas will come under the coverage of ESI Act and they would be bound to pay the contribution at 4.75+1.75 % of wages with effect from the date of notification. The present amendment says that whenever a new area is brought under ESI scheme, the establishments in that area will have a concessional rate of contribution for 2 years.
Hi, Request please refer this attachment and suggest. Recon this is applicable only for new coverage areas. With Regards Sathya Narayana Y S

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File Type: pdf 16aug_circai18.pdf (516.7 KB, 1391 views)

The notification only states that in respect of an establishment in an area newly notified as ESI Covered area, the rates will be 3% and 1% for two years (twenty four months). That means this is applicable to newly covered establishments in the newly notified areas and not to all establishments.
Sir, in addition to the views of Sh. Madhu T.K. ji, as above, I may submit that the said notification is only an intention notification intimating about draft rules. These are not final and the exact date of implementation or enforcement of the amendment, if finalised by appropriate government, will be indicated in the said final notification. Therefore, till the draft rules are finalized and published in the gazette of India, and the effective date of said rules is indicated, it is only a proposal or only an idea.
As the senior Member Shri Madhu T.K and Mr. Mehta has rightly mentioned that first it is a Draft Rule proposed which has not been passed yet. Secondly the rate is applicable for all the new areas where ESI is implemented for the first time and the rate is valid for the first 24 months of subscription from the date of such implementation. From the 25th month the regular rate will be applicable.
Can any one provide which areas are covered in Maharashtra, Rajasthan and Bihar. If possible please provide notification inresepct of the same.
FYI enclosed the notification for your kind reference you can also find the same in ESIC official website Regards Sathya Narayana Y S

Attached Files
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File Type: pdf Andra Pradesh.pdf (445.3 KB, 208 views)
File Type: pdf Bihar.pdf (448.5 KB, 61 views)
File Type: pdf Faridabad.pdf (441.3 KB, 93 views)
File Type: pdf J&K.pdf (516.0 KB, 41 views)
File Type: pdf Karnataka.pdf (442.4 KB, 158 views)

Dear Members,
We have a manpower contract in newly ESI notified are in Maharasthra. We obtained a sub code for this and unable to make contribution @4%. As the contribution are being paid online and software calculate @ 6.5% automatically.
Please help me how to make contribution @ 4% or it is not applicable for sub code unit.

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