Do Monthly Grooming Fees for Our Doorman Affect E.S.I. Contributions? Seeking Advice

Dear seniors,

We are paying an amount of 400/- to our doorman as a part of grooming charges every month. My doubt is, will these grooming charges attract E.S.I.? Awaiting an early response.

Dear,

What is grooming allowance, and what is it given for? Can you please explain?

Thanks,
J. S. Malik

Please explain if the doorman is working exclusively for you or if he is employed by multiple companies or individuals for grooming work. If he is working for more than one employer, then ESI will not apply. Please reply.

Hello everyone,

We have received a similar notice from ESI. There are a few casual employees who are working exclusively for us, such as the cook. Additionally, there are a few casual employees who work for multiple people, like the Maali, sweeper, and helper for the cook to clean utensils.

Please advise on this.

Thanks and regards,
Dr. Shikha Sahai

Dear Sir,

We pay the doorman for the purpose of getting his clothes washed and for his shaving needs. The expenses incurred for these services are combined and termed as grooming allowances. He works for two companies, depending on the need.

Thank you.

Any allowance that is paid at intervals of not more than two months shall come under the definition of wages and will attract ESI. Therefore, the allowance in this case (sorry, I have not come across such an allowance) will also attract ESI. These may be minor amounts for an employer, but for an employee like a watchman, it matters because the higher the contribution, the greater the benefits he receives from ESIC.

Regards, Madhu.T.K

Dear,

It will attract ESI, and you have to make a contribution towards ESI against this payment as it is part of the salary paid every month.

Thanks,
J. S. Malik

All allowances are part of the definitions of wages under the ESI Act. They are subject to deductions for ESIC purposes. :-)

Dear All,

1. Notwithstanding the nomenclature of the allowances,
i. if the payment is at regular intervals of less than two months (in the instant case, it is a monthly allowance) and
ii. paid as a fixed allowance and not a variable reimbursement of defraying actual expenses as in the instant case,
ESI contribution is payable. In other words, if the upkeep amount is paid at various dates on production of actual claims/bills, the same would not attract ESI contribution.

2. As regards the queries raised by Dr. Shikha Sahai, notwithstanding the fact it is casual or temporary - be it Maali, cook, etc., all would come under the definition of an employee for the purpose of ESI Coverage, and hence contribution is payable. If cooking/washing is temporary in nature, depending upon the accounting entries, ESI contribution/coverage will be determined.

A. Irudayam
Advocate and HR Consultant - +91 99406 86632