ESI Exemption - Workmen Compensation

Dear HR Fraternity,

Would you like to share your views on the much complicated scenario on ESI Coverage and exemption.

There is a Company/ Establishment Registered and Operating from the area that falls in the ESI Exempted region. There is no branch elsewhere. Accordingly,the Establishment is not contributing towards ESI. But as a Employer has subscribed for Workmen Compensation Policy and providing full coverage to all the employees in terms of Hospital, Insurance, Accident etc.

Mostly, all the Employees work in the Establishment.

However, (1) there are certain Functions/ Department where employees of these departments viz: Marketing & Sales have to travel and visit areas which are not exempted from ESI.
(2) There are certain set of employees less than 10 nos, who are deputed to other areas or premises of other party/vendor which are not exempted from ESI.

Would like to understand whether in such situation 1 & 2 the Establishment/ Employer needs to take ESI coverage for these set of employees if their salaries fall in the ESI range ie. gross less than Rs.10000/- per month.

As I understand if the monthly Gross is above Rs. 10000/- per month, such employee is to be excluded from ESI coverage.

Hope to receive an expertise comment of both the situations.

Now the salary ceiling for ESI coverage is enhanced to Rs.15,000 from Rs. 10,000.
Abbas.P.S

If the deputed employees work for short period in the areas covered under ESI and If their salary is paid from the Head Office, you need not apply for ESI registration/pay contributions for them. any how, you have taken carae to cover them under WC Act, which suggests your attitude to take care of them in case of accidents. The coverage limit is Rs 15000/
vijayakumar kanna

Dear Vijayakumar,

Thanks for your inputs.
Sometimes back, i witnessed a situation where the ESI Inspector was enquiring about the coverage to the employees working in the areas which are not ESI Exempted. The Payroll was centralized and the Registered Office was in ESI Exempted areas and all the employees where shown on the roll of the Office which was ESI Exempted.

The Inspector mentioned that although, the payroll is centralized and all the Employees are part of Office which is in the ESI Exempted area but they are working in the Office which falls in the area which comes under ESI coverage and hence they are to be covered. Fortunately, all the employees were having gross above the entitled limit.

Similarly, there is a new case, where it is informed that even if the employee is on the roll of the Company which falls in the ESI exempted area but then if by virtue of travel or deputation if he/she has to visit in ESI coverage, even for a day, and is ESI eligible category, he/she should be covered under the scheme even if there is WC Policy.

This is somewhat confusing.

No confusion at all. Payroll process location has nothing to do with ESI coverage. ESIC coverage is decided as per the area of activity of the concerned employee/worker.
regards,

Subject - ESI wages
hi guys.......as per the esi person earning less than 15000 wages is eligible for esi......
can ne one explain the defination of wages in esi act, all the allowance included in wages and whether remuneration is included or exclude....what are the types of remuneration
and whether washing allowance is included or not
i know my discussion may be confusing ...plzzzzz help me

Subject - ESI wages
hi guys.......as per the esi person earning less than 15000 wages is eligible for esi......
can ne one explain the defination of wages in esi act,WHILE CALCULATING ESI all the allowance included in wages and whether remuneration is included or exclude....what are the types of remuneration
and whether washing allowance is included or not
i know my discussion may be confusing ...plzzzzz help me

Dear frineds,
Any allowance forms part of salary paid to employees every month need to be taken for coverage. Regading pf contribution of employers including share for pension fund is not taken into calculation.
However some company pays the washing allowance separately and if paid so it need not be taken into consideration of calculation of ESI contribution.
Regards.