Understanding ESI: Is It Applicable If an Employee Leaves Mid-Month? Seeking HR Insights

Dear Friends,

Please help me as I have a query regarding ESI. Suppose an employee leaves the organization in the month of May 2010 (either in the middle of the month or the first week of the month), is ESI applicable to him? State the minimum number of days or quote the rules in this regard. I request all my HR friends to suggest in this regard.

Regards,
Ashok

Your query is not clear.

As far as ESI is concerned, even if a person works in a covered unit for just one second for wages, they will be covered under the ESI, and you have to contribute in respect of such a person.

In a nutshell, all casual, contract, daily, and temporary workers are covered under ESI.

[QUOTE=teki ashok;1155112]

Dear Friends,

Please help me as I have a query regarding ESI. Suppose if an employee leaves the organization in the month of May 2010 (either in the middle of the month or the first week of the month), is ESI applicable to him.

Answer: According to you, if the employee has worked the first week of May 2010, he will be liable for ESI contribution. This is the basic rule of ESIC. Wish you all the best.

Dear Mr. Rana,

ESIC will be applicable to the employees because the ESIC limit has been enhanced on May 1, 2010. During that period, the employees were present.

Regards, Jitendra Tomar 931335381

Hi,

In ESI, you have a contribution period (April - Sept & Oct - Mar) and a benefit period (Jan - Jun & Jul - Dec). We submit returns twice a year: May 12th for the Oct to Mar period and Nov 12th for the Apr - Sept period. If any employee leaves in May, they may avail of this facility up to the next ESI returns (which would be Nov 12th).

It is applicable up to Sept. Hope it's clear.

Regards,
Leela

QUOTE=teki ashok;1155112]Dear Friends,
Please help me as I have a query regarding ESI. Suppose if an employee leaves the organization in the month of May 2010 (either in the middle of the month or the first week of the month), is ESI applicable to him? State the minimum number of days / quote the rules in this regard. I request all my HR friends to suggest in this regard.

Regards,
Ashok[/QUOTE]

Dear sir,

Thank you for all of your valuable suggestions. I would like to explain the question clearly with an example:

For example, a person, x, is receiving a gross salary of Rs. 14,000/- per month. If x resigns and leaves the organization on May 11, 2010, and falls within the ESI bracket (due to the ESI wage enhancement limit of Rs. 15,000/-), my queries are:

1. If he was relieved on May 11, 2010, is it mandatory to make employer ESI contributions from the organization's side? Additionally, as per the ESI Act, are there any rules that mention the number of days an employee should work in a particular month to be eligible for coverage under the ESI Act if he leaves the organization?

2. Also, if x leaves on May 01, 2010, is ESI deduction applicable (both employee and employer) even for just one day?

Your valuable suggestions are required in this matter.

Regards,
Ashok

I hope my earlier post answers your question. In other words, you have to pay the contribution in respect of the two examples you have given. You have to pay the ESI contribution on the wages received during that period, irrespective of the number of days/hours/minutes/seconds worked for wages.

Hope your doubt has been clarified. In case of any further doubts, do not hesitate to call me at 09443434313.