Are Employees Responsible for PF and ESI Deductions if Not Mentioned in Offer?

Dear All,

Please let me know if the company hasn't mentioned anything about PF and ESI deductions during the interview or in the appointment letter. The salary heads mentioned are Basic, HRA, and Conveyance Allowances with the total CTC. Now, if the company has decided to deduct PF and ESI from employees, is the employee solely liable to bear the deductions?

Thank you & Regards,
Gunjan

I want to know about ESIC and PF rules. Are both deducted on basic salary or basic + DA? Please clarify for me.

Dear Gunjan,

ESI and PF are statutory requirements, whether the company mentioned the costs in the appointment letter or not. It is the company's responsibility to pay the employee and employer share of the contribution to the ESI and PF organizations.

Regards,
Anbarasan J.

Dear friend,

ESI should be deducted from the gross salary and the PF should be deducted from the Basic+DA.

Regards,
Anbarasan J

Please, can anybody help me? If we pay overtime to employees, do we have to deduct ESIC from the overtime amount?

Anita

Hi,

PF deduction is applicable only on Basic + DA and it is not applicable on HRA & Conveyance.

Hi,

An employee is liable to pay only his contribution, which will be deducted from his gross salary. The employer needs to pay their contribution towards the employee, which will be part of the CTC.

Net Salary = Gross Salary - Employee contributions (ESI, PF, PT, IT, etc.)
CTC = Gross Salary + Employer Contributions (ESI, PF, Grad, etc.)

Please tell me for which allowances ESI is not deducted. In cash, it is deducted. Do we have to submit the supporting bills during the inspection?

Regards,
Amith Shetty

Dear all,

PF and ESIC are both calculated on Basic salary + DA. The rate of PF contribution is 12% of Basic + DA from either side. For ESIC, the contribution is 1.75% from the employee and 4.75% from the employer. Additionally, the employer adds 1.61% as EDLI charges.

The ceiling rate for PF is ₹6500 per month and for ESIC it is ₹15000. I hope this information is sufficient for all of you.

Regards,

Sudhir R. Wagh
HR Executive

Explanation Needed on Minimum Wages and Deductions

Can you please explain the following:

As per the LABOUR DEPARTMENT PUNJAB, are the minimum wages (2013) in Punjab, Rs. 5695/- the basic salary component of the CTC, or is it the CTC?

Is ESI and PF deducted on CTC or Basic Salary?

What is the minimum criteria of CTC/Basic salary to deduct ESI and PF?

Regards,
Parmod Kumar

Please tell me the amount of deduction of PF & ESIC from the following salary slip:

Salary Slip Details

- Basic: 7843.68
- HRA: 392.18
- Special Allowance: 2085.98
- Conveyance: 1320.00
- Gross Salary: 11641.84

Please give me the details of PF and ESIC deduction details. In the same case, if he is on leave for 2 days and the same is leave encashment:

Leave Encashment Details

- Basic: 6938.64
- HRA: 346.93
- Special Allowance: 1845.29
- PL Encashment: 905.04
- Conveyance: 1320.00
- Gross: 11355.90

Please provide me with the details of PF and ESIC deduction details.

Regards

Hello All,

We have ESIC applicable for a few employees, due to the new amendment in ESIC i.e. 21000 gross salary, many new employees are added, and we are deducting ESIC payment from CTC. Since the new amendment came into force during the financial year, employees are being affected. Their net take-home salaries are reducing from January 2017. They are asking to compensate the employer ESIC portion for the months. Please let me know what is the right way to address it.