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kumar.kankit@rediffmail.com
4

Dear Seniors,
An Employee fixed gross salary is 19600/-
However this employee is also getting sales
Incentive variable Not fixed upto 7000 to 15000 PM Plz
clarify weather this variable incentive component paid monthly shall let this employee to be in the purview of ESI or not,
Regds
Kankit

From India, Jodhpur
Glidor
630

basic concept is
whether the incentive component is considered as part of salary or not
if the same is accounted in his form 16, Profession tax, pay register and TDS purpose , then Yes it is part of salary for ESIC/PF/PT Purpose
if the incentive is given as sales promotion without taking the employee name in consideration, the how the same is treated at employer end? under form as one establishment can not issue form 16 and 16A both for a single person,
check the basic facts to categorize the same in appropriate account
variable or fixed is not an issue,
issue is of accounting method maintained by the establishment


deveshch
18

Dear kankit.
All the act. Has its different meaning of
Wages in its different section for EPF meaning
Of wages is defined in sec 2(b) of epf act. & wages
for ESI contribution is defined in sec 2(22) of ESI Act. Therefore for the chargability of
ESI shall Not depends from the point of
income tax, PT, Etc,
However with regard to your query if sales incentive is being paid monthly shall
Attract to ESI contribution if the same is
Being paid after 2 month periodical will not attract
ESI contribution,
Thanks & Regards
Devesh Chauhan
Practicing in Accounts, Finance, Taxation,
Labour Laws

From India, Basti
fc.vadodara@nidrahotels.com
733

An employee who is getting over Rs. 15000/- per month will not come under the purview of ESI. Please note that the enhancement of ESI from Rs. 15000/- to Rs. 21000/- has not come to effect as the notification is still awaited to the best of my knowledge.
From India, Ahmadabad
fgla
2

Dear Kankit,
Mr. Devesh Chauhan is right , if any incentive of whatever amount on monthly basis with salary , in this case all amount will consider under ESI act. If the same incentive paid after 2 month or quarterly in this case ESI will not apply.
Sunil Kumar Chauhan
Director - Trainer on manufacturing Basics
FGLA Concept Marketing Private Limited

From India, Calcutta
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