Can We Stop ESIC Deductions for Employees Covered by CGHS Due to a Parent's Government Job?

Hi, I'm working as Manager H.R. in an Interior firm. One of our employees who recently joined has submitted an application requesting to stop deductions for ESIC Contribution since his father is a Government Servant, and he and his family are covered under the CGHS facility. Can anyone tell me if it is okay to stop ESIC deductions?

No, he can't if his salary is below 15,000 Rs. ESIC contribution has to be deducted every month. Please let me know if you need any further assistance.

If he earns below ₹15,000, he is eligible for ESIC. However, his father will not be eligible.

Thanks,
Mohd

ESI Deduction Guidelines

Please note:

- ESI deduction is statutory, and companies are liable to deduct the same from eligible employees.
- No individual can opt out of ESI deduction on their own.
- If the gross salary is up to Rs. 15,000/-, please deduct the ESI contribution.
- Employees' parents, wife, and children will also be covered and are eligible for ESI benefits.

Regards,
K. Ramachandra
Bangalore

Talk to the concerned employee and explain to him that his request cannot be considered since his coverage under ESI is as per the provisions of the law.

Regards,
Vasant Nair

No, we can't exempt any single employee from ESIC if they are earning below ₹15,000. If you exempt that employee from ESI deduction, then during an ESI inspection, you will have to answer for it, and you will be charged.

ESI benefits are for the employees. We need to help them understand this benefit, which they can avail from ESI. Unlike his father, a government employee, who has benefits, similarly, in private organizations, we have PF & ESI benefits for employees. They consider this as a deduction from their salary and are aware of the benefits. So, my suggestion would be to make them understand the benefits since it's a statutory law, not made by private organizations.

Regards,
Nimisha

No, I don't think so because he is not dependent on his father. After 21 years, the facility that his father is receiving from the government is not applicable to him.

Hi Mr. Chachad Kiran, whatever it may be, if he is eligible (gross less than 15,000), then the organization should recover 1.75%. NO COMPROMISE IN THIS.

It is mandatory for all employees, including staff, who are receiving less than ₹15,000 gross salary (not CTC).

Regards,
Praveen
Career Growth Consultancy
Bangalore

I agree with Nimisha. 99% of employees will think this is an unnecessary deduction; they don't know the ESI benefits. As HR professionals, we need to make them understand the benefits of ESI & PF.

Regards,
Praveen

Dear Chachad Kiran,

First of all, I will make it clear that if the gentleman is working with your organization and has become independent from his parents, then he is not entitled to CGHS facilities provided to his father, mother, and other family members.

If his salary is less than Rs. 15,000/- per month, then it is mandatory for him to pay the ESIC contribution. He cannot be exempted under any circumstances.

Thank you,

Sushil Kumar

I am also facing this same question. As per the government provision, we have to deduct ESI from all eligible employees.

Regards,
Subas

I work for a construction company where ESIC is applied. I have more than one question:

ESIC Deduction for Short-term Workers

1. Not some but most of the workers here work for less than 10 days and leave for their places. Do we have to deduct ESIC for them? If it is compulsory, it's a pity.

Handling PF and ESIC Deductions

2. Some of our workers are requesting not to deduct PF for them. If I don't deduct PF, how can I deduct only ESIC for them? Please help me with a quick solution.

Regards,
G.V