Is ESIC Calculated on Gross Salary or CTC? Understanding Employer Obligations

ESIC: Applicable on Gross Salary or CTC?

ESIC stands for Employee's State Insurance Corporation. The contribution for ESIC is calculated on the basis of the employee's gross salary, not on the Cost to Company (CTC). The gross salary includes basic salary, allowances, and any other taxable components but excludes components like bonuses and overtime pay. It is essential for employers to ensure compliance with ESIC regulations to provide mandatory health insurance benefits to their employees.

ESIC applicability is based on gross salary only. Those who earn less than or equal to ₹15,000 are eligible for ESI benefits.

Regards,
Sriharsha .Y

Geographical Coverage of ESIC

How does ESIC cover geographically? If we are out of the city area and want to connect with ESIC, is it possible? What is the actual range for it?

Thanks,
Amit

I am an accountant in an industry, and I am covered by ESIC with my father, mother, and wife. I have 2 questions regarding that:

1. Can I take my father, who is over 60 years old, to the ESIC hospital for treatment?

2. How can I avail the maternity benefits from ESIC for my wife? Please, sir, tell me the process in detail.

Ramesh Tripathi

Dear Tripathi,

Your father can receive treatment from an ESIC Hospital. However, your wife cannot avail maternity benefits from ESIC as she is considered a family member or spouse only. Nevertheless, she can receive all treatments from an ESIC hospital.

Regards,
Ramesh Tripathi

I am an accountant in an industry, and I am covered by ESIC with my father, mother, and wife. I have 2 questions regarding that:

1. Can I take my father, who is 60+, to the ESIC hospital for treatment?
2. How can I avail the maternity benefits from ESIC for my wife? Please, sir, tell me the process in detail.

Ramesh Tripathi

Eligibility for ESIC Benefits

1. Your father is also eligible for ESI.
2. She is eligible for taking maternity benefits. Obtain form 37 (Continuation of Employment) from your employer, then visit the ESI dispensary nearest to your house. Ask your HR for better guidelines.

Even if you are outside the city, you are eligible to receive ESI treatment from the ESI dispensary near your village or city. Obtain Form 105 from your employer and submit it at the ESI dispensary near your village or city.

The post pertains to around five months ago. Therefore, I am not sure if any addition to it would provide any value. However, let me clarify that if your parents' income from all sources does not exceed Rs 5000 (it was limited to Rs 1500 when the thread began), they can now be included as dependents. After doing so, they can avail of the medical benefits outlined by the ESI Scheme. The recent revision in income may take some more time to be fully implemented. In the meantime, you can include your parents by updating the family details on the ESI website, obtaining a printout, and then visit the local office for a photo session.

Regards,
Madhu.T.K

No. The same rules that apply to shops and establishments also apply to the service industry. Therefore, if you employ 20 employees (or 10 in the case of establishments engaged in manufacturing activities), your establishment will be covered by ESI.

Regards,
Madhu.T.K