Understanding ESIC Deductions: Do Salaries Over 10,000 Include Them?

Dear All,

Please let me know if any employee whose salary is above 10000/-, including the CTC, will have ESIC deductions or not.

Please clarify this point for me.

Nirmala
HRD

Dear Nirmala,

If anyone's total gross salary is less than 10k per month, then he will be covered under ESIC. Mind it, this is not part of the CTC.

Thanks,
JS Malik

Dear Malik Sir,

I am working in the Concrete Sleeper Business Group in the vicinity of Barabanki, Uttar Pradesh. I would like to inquire whether ESIC coverage applies if the ESIC office is located more than 15 km away from my factory.

Regards,
Ramesh

Dear Ramesh,

The distance between your company and the ESIC local office is not relevant. You have to visit it at the time of filing returns, that's it. It is the locality of your employees and their ESI dispensary that you need to consider when issuing the ESIC card. Please check with your local office for the chart listing the dispensaries available in your city. I hope this clarifies any doubts you may have.

Regards,

Chandru

Hello,

The allocation of the dispensary depends on the address you mention when filling out the ESI form. Accordingly, the nearest dispensary is allotted. I hope that solves your query.

Madam,

CTC means all the total components of the salary package: basic, HRA, conveyance, special allowance, PF, LTA, Medical, Incentive, Gratuity, Medical Insurance, and more.

ESI Contribution will be calculated on the Gross salary only. Gross salary refers to all the total earnings based on the working days in the current month. The gross salary formula is as follows: Basic + VDA + HRA + Conveyance + any special allowance only. For ESI calculation, the Gross salary will consider all components. If the total earnings are 10,000 and below, then the staff/worker is covered under ESI. If the gross salary exceeds 10,000, ESI will not be applicable.

If a staff member is covered under ESI, then overtime and incentives will also have ESI contribution deductions.

Dear Nirmala,

You are working in HR and you want your question to be replied to immediately, but neither do you see posts of your question nor do you reply to your query. Really disgusting.

J. S. Malik

Dear Nirmala,

Better you go through the ESIC Laws and rules, where the definition of earnings and wages is given. There is no question of CTC coming into the picture for the applicability and deduction of contribution.

Uday Kr Verma

Dear Seniors,

I too have some queries regarding ESIC. Kindly clarify.

ESIC on Leave Encashment - Is ESIC deductible on Leave Encashment? I believe not, as ESIC is deducted on Gross and Leave Encashment comes in CTC. Please advise.

ESIC on Overtime - The book on Labour Law specifies the term "Wages" for ESIC as excluding overtime. That means ESIC is not deducted on overtime. Please clarify if I am wrong.

Kind regards,
Beena

Dear Sir,

Kindly let us know how to calculate the interest on late deposits of ESIC/EPF contributions.

Regards,
Rishi Saxena

Hi Nirmala,

A person's gross income should be $10,000 or below for them to be eligible for ESIC.

Regards,
Raja