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If an employee chooses to continue with ESI even after his/her salary was hiked above 21,000/- limit, what will be the employer contribution? Is it zero, 4.75% of 21,000 or 4.75% of the new salary?
There is no provision in ESI Act permitting an employee to exercise option to continue to be covered by the ESI if his wages exceed Rs.21000/-pm.However where such hike beyond Rs 21000/- occurs after the start of the contribution period, he can continue to be covered till the end of the contribution period.
B.Saikumar
HR & Labour Relations Consultant.

Thank you Sai for your response.
In case the hike happens in between a contribution period, do we have to deduct 1.75% / 4.75% of 21,000/- or the new gross salary?
Yes, you have to deduct employee and employer contributions at the existing rates till the revised rates come into force. B.Saikumar HR & Labour Relations Consultant
on gross wages only, if any body knows the sec. / rule pl. let us know. Regards, Srinivas
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