Understanding Employer Contributions: How Much Should Be Allocated for ESI and PF?

Hi Seniors,

I know PF contribution is 12% of the CTC and ESI contribution is 1.75% of the CTC. Please suggest to me how much the employer contribution should be?

Regards,
Anita

Hi Anita,

Employees Provident Fund covers three schemes with contributions of 12% from employees and 13.61% from the employer's side:
1. Family Pension Scheme: 8.33%
2. Provident Fund: 3.67%
3. Link Insurance Scheme: 0.5%
4. Administrative Expenses paid by the employer: 1.61%

Employees' contributions are deducted from Basic + DA. Organizations with 20 or more employees are covered under the scheme. The minimum salary required is Rs. 6500 per month.

ESI deductions include 1.75% from employees and 4.75% from the employer. The calculation is based on Basic + DA, and employees earning Rs. 50 per day are eligible for coverage.

Dear Ms. Anitha,

PF will be calculated in Basic + DA. Employee contribution is 12%, and employer contribution is 12%. Apart from this, the employer should pay the administrative charges and EDLI (Employees' Deposit Linked Insurance) charges.

For ESI, the employee contribution is 1.75% of the Gross Amount, and the employer contribution is 4.75%, making it a total of 6.5%.

Hope you now have a better understanding of this.

Regards,
Saravanan J

Hi Saravanan,

Please do correct me if I am wrong. The calculation of EPF is as follows:
- Employer contribution: 12%
- Employee contribution: 12%
- Family Pension Scheme: 8.33%
- PF Scheme: 3.67%
- Link Insurance Scheme: 0.5%
Total: 12%

Additionally, the administrative expenses of 1.61% are paid by the Employer.

Thank you.

Dear Anita,

PF DEDUCTION:
EMPLOYEE = 12% (OF BASIC SALARY)
EMPLOYER = 12% (OF BASIC SALARY) + ADMIN CHARGES = 1.61% (OF BASIC SALARY)

ESI DEDUCTION:
EMPLOYEE = 1.75% (OF GROSS SALARY)
EMPLOYER = 4.75% (OF GROSS SALARY)

Regards,
Pankaj Chandan

Hi Seniors,

Thank you very much for your information. I am now very clear on this part.

Another question I have is, can PF be withdrawn at the end of service? What about ESI? Please assist me with this.

Regards,
Anita

Hi Seniors,

Will both the employer and employee contributions for PF be deducted from the employee's pay? I am a bit confused about this.

Regards,
Anita

Dear Anita,

The employer contribution in PF is 13.61%. It is divided into 5 accounts in the PF Challan: 3.67%, 8.33%, 1.10%, 0.01%, and 0.05%.

Thank you.

No, the employee contributes 12% of his salary. The other part of the PF will be paid by the employer.

I suppose Priya is right; employer contributions are as follows:

- Pension: 8.33%
- PF: 3.67%
- DLI: 0.5%
- Admin Exp: 1.61%
- ESI: 4.75%

Dear Anita,

Only the employee's contribution is deducted from the employee's salary.

Regards,
Pankaj Chandan

Employee's: 1.75% of Gross
Employer's: 4.75% of Gross
Total: 6.50%
Ceiling Amount: 10000/- (less than or equal to 10000/-)

Hi Anitha,

Only employee contribution (12%) is deducted from the employee's salary, while the employer contributes the other 12%.

Regards,
Chakri.

Dear Sir,

PF contribution of 12% is deducted from the employee's basic salary + DA, and the employer's contribution is 13.61%. The bifurcation of the 13.61% employer contribution is as follows:
- 8.33% is for the pension
- 3.67% is the employee's share
- 0.5% is for EDLI
- 0.01% is for EDLI admin charges
- 1.1% is for administrative charges

Regards,
Mukesh Sharma

No, you can't deduct employer contributions from employees' salary. ESI contribution cannot be withdrawn.

Rajesh

Hi Anita,

PF calculation on Basic + Appl.Allow = 12% employee = 13.61% employer. Limitation: Rs. 6500.

ESIC calculation on gross salary = 1.75% employee = 4.75% employer. Limitation: Rs. 10,000.

Vinay 9850062122

Dear All,

Please find the process flow for the PF. It contains everything related to PF contribution/process flow. Also, I will post the process flow on ESIC very soon.

Hope it will be useful for everybody.

Thanks & Regards,
Kumar Gourav

Dear Sir,

I want to know about my PF balance. Can I get this information online through the net? If yes, then please provide me the website for this.

Hi,

PF contribution is 12% on Basic or Basic+DA if you are paying DA. It is not on CTC. 12% has to be paid by the employer.

For ESI, 1.75% of Gross salary of the employee, and the employer has to pay 4.75%.

Hope this will help you. :icon1:

John

It is not possible to know the balance through online. However, you can request details online, and those details will be sent to your employer.

Employer contributions:
- PF (Basic + VDA + DA) - 13.61%
- ESI (Gross Salary except Washing Allowance) - 4.75%

For further queries, you can reach me at 9909001742.

Regards,
Abhijeet Sawant

Hi Anitha,

As per the amendment dated 22/9/1997, both the employee and the employer have to contribute to the PF at 12%. However, the employer has to contribute an extra 1.61%. The breakdown is as follows:

Employee Employer
A/C No. 1 PF 12% 3.67%
A/C No. 2 PF admin a/c 1.10%
A/C No. 10 EPS 8.33%
A/C No. 21 EDLIS a/c 0.50%
A/C No. 22 EDLIS admin a/c 0.01%
Total 12% 13.61%

For ESI, the employee's contribution is 1.75% of the gross salary, with a ceiling limit of Rs 10,000 gross salary. The employer's contribution is 4.75%, making a total of 6.5%.

Thanks,
Shreekanth.P.R

Hi Anitha,

As per the amendment dated 22/9/1997, both the employee and the employer have to contribute to the PF at 12%. However, the employer has to contribute an extra 1.61%. The breakups are as follows:

employee employer
A/C No. 1 PF 12 3.67
A/C No. 2 PF admin a/c 1.10
A/C No. 10 EPS 8.33
A/C No. 21 EDLIS a/c 0.50
A/C No. 22 EDLIS admin a/c 0.01
____________________________________________

12 13.61

For ESI, the employee's contribution is 1.75% of the gross salary, with a ceiling limit of Rs 10,000 gross salary. The employer's contribution is 4.75%, making a total of 6.5%.

Thanks,
Shreekanth.P.R

Hi Anitha,

Only employees' contributions will be deducted from the pay. The employer's contribution, along with the said administrative charges, will be paid by the company.

For PF, the employer's contribution is 12%, along with other administrative charges of 1.10, EDLI charges of 0.50, and 0.001.

ESI charges are at 4.75% from the employer's side.

Dear Anita,

ESI contribution is meant for ensuring and providing medical assistance for the employee and their dependents' health. Neither the employee's nor the employer's contribution to ESI accumulation will be available at any cost. However, your and the employer's ESI contributions would assist at the time of availing the below-mentioned benefits:

1. Medical Benefit
2. Disablement Benefit
3. Maternity Benefit
4. Sickness Benefit
5. Dependent Benefit

Thanks, Vedha

Hi Anitha,

ESIC is calculated on gross salary where the employee contribution is 1.75% on gross and the employer's contribution is 4.75% on gross.

PF is calculated on Basic+DA. The employee contribution is 12%, and the employer contribution is 13.61%. The bifurcation of 13.61% is as follows:
- 8.33% as pension fund.
- 3.67% as provident fund.
- 1.61% comprises PF admin (1.10% calculated on Basic + DA), EDLI (0.5% calculated on Basic + DA), and EDLI admin (0.01%).

For EDLI, if Basic + DA exceeds 6500, the calculation is done based on 6500 only, and the remaining amount will be entered into the provident fund.

I hope this clarifies the breakdown of contributions. Let me know if you need further information.

Hi,

Great to know this information from you. Regarding ESI, those employees who get medical facilities & drawn more than a 10,000 salary, what is it called? Please help me.

Hi all,

This is Alpa. I have some queries regarding PF and ESIC. I have left one company and now want to withdraw my PF amount. I want to know the exact amount of PF and also understand how I would receive that amount if I join a new company.

Regarding the ESIC amount, I am unsure. Can you provide me with more information on this?

I am a fresher in the HR field and I am currently studying PGDHRM from Symbiosis University. I am curious if I can secure an HR job in a company with my current studies.

Please suggest me on the above queries. Thank you.

Dear Anita,

First of all, I would like to correct one error in your sentence:
PF is calculated on Basic, not on CTC. ESI is calculated on Gross Salary.

Now, let's address your question regarding the employer's contribution for PF and ESI:
- PF Contribution of Employer: 12% of Basic
- ESI Contribution of Employer: 4.75% of Gross Salary

Regards,
Bhagwan Tolani
Sr. HR, Cosmos Retail
Mumbai
+919784539090

Hi Everybody,

I have gone through everybody's reply; let me clarify a bit more A/c wise.
A/c 1... 15.67% (12% employee share + 3.67% employer share)
A/c 10... 8.33% (Employer share)
A/c 2... 1.10% of wages (Basic + DA)
A/c 21... 0.5% ---do-----
A/c 22... 0.01% ----do-----(subject to a minimum of Rs. 2/-)

Here I am facing a problem also; please do let me know if anyone can help me in this regard. Can anyone guide me on what wages PF is applicable to? So far, my knowledge says it is on normal wages only as mentioned in the above replies. However, we are being asked by PF Authorities to deposit the Contribution on OT Wages also (wherever paid), both Employees' and Employers' share in arrears with Interest and Damages. They are framing us under Sec 7A, Evasion of wages.

Can anyone help us in this matter? How is OT being calculated for PF Contribution and being framed as Evasion of wages? An early reply will be highly appreciated.

Thanks

Regards,

Harminder Singh

Dear Anita,

Please understand the whole process of PF & ESIC by reading the books available in the market. Senior persons will guide you on any matter in your career that can help solve your problems. However, for this, you have to put in extra effort for your basic preparation in any subject.

The answer to your question is that there are deductions of PF & ESIC contributions from employees' salaries. When depositing the share of PF & ESIC via challans, employers' contributions are calculated (for PF 13.61% & ESIC 4.75%) and both the shares (employee & employer) are deposited in the bank. PF is divided into five accounts: A/c1 (3.67% & 12%), A/c2 (1.10%), A/c10 (8.33%), A/c21 (0.5%), and A/c22 (0.01%).

To understand these calculations, you will have to prepare challans of your organization by yourself. Get them checked by your senior or consultant because there are very small details to consider in these calculations.

Vinay Shedge
9850062122