Advice On OT

Dear friends,
Kindly advise me as to whether overtime attracts PF and ESI.
regards,
Maj Subhash Sharma

I don't think OT attracts PF or ESI.
As per my knowledge PF and ESI is decided on Basic Pay.
With Regards
Phanindra Sai A

Mr.Subash Sharma
No question abt OT attracts P.F, O.T will not attract P.F, O.T attracts E.S.I only but doesn't calculate for the eligibility criteria i.e 10,000. we cannot add O.T to Gross salary to conclude for the Eligibility criteria.
Hope it clears ur ambiguity
rgds
S.V

Dear Friends,
PF cut on basic salary but ESIC cut on gross salary.
hence according to me ot can attract esic.
Regards,
Reshma Sawant

Dear Mr. Subhash,
Good Afternoon!!!
OT doesnt attracts PF as Pf always calculated on Basic Salary not on Gross salary and OT alwys effect on gross salary not on basic.
OT can attract ESI if even after adding OT once's salary is below or equals to 10000/- gross.

Dear Sharma,
Ofcourse OT attracts ESI not PF. Not only OT every thing attract ESI, whatever you pay on monthly basis even as allowance.
Sanjay Gupta, Noida

Dear Team,
As per the ESIC act it is told that ESI is calculated on Basic and all allowances. And OT is also considered to be an earned allowance it attracts ESI. Even though ESIC ceiling is 10000 as Gross earnings, OT stands seperately. Only Bonus and Exgratia paid to workers will not attract ESIC.

Hello Mr.
O.T will not attract P.F, O.T attracts E.S.I only but who is eligible for this criteria i.e 10,000. we paid total deduct after ESIC,and calculate O.T.double required for Factory act.
Hope it clears ur ambiguity
rgds
C.P.V

ESI contribution is payable on OT but not for EPF. Any payment made not on montly basis, viz, incentive, performance bonus, if made , say once in two months, or more, ESI is not payable. Certain expences reimbursed as shoe allowance, washing allwoance, (defrey), encashment of leave, Bonus/ exgratia payments also do not come under the definition of " wages" under ESI ACT.
HC Subbaramu
HR Consultant, Bangalore

Dear Subhash,
OT does not attract PF as PF is calculated on Basic + DA
Yes, it does attract ESIC. When employee does overtime work it amounts to the acceptance for the same, hence there emerges concluded implied contract between the employer and the employee. Both the remuneration received during the working hours and overtime constitutes a composite wage and thereby it is a wage within the meaning of Sec.2(22) of the ESI Act.
Therefore, the contribution is payable on the overtime allowance.
However, overtime allowances will be considered as wage for the purpose of charging the contribution only and will not be considered for the purpose of the coverage of the employee under the Scheme.
Hope this clears your doubt.
Regards,
Manasi Shah
HR/Labour Law Consultant
Advent Corporate Services
Mumbai