Hi Altaf,
ESI is contributed from both sides, by the employee as well as the employer. It is calculated based on the gross salary per month, with a maximum ceiling of Rs. 10,000 per month.
The contribution from both sides is as follows:
Employee Side - 1.75% of gross per month. For example, if an employee's gross salary is Rs. 8000 per month, the ESI contribution would be 8000 * 1.75% = Rs. 140.
Employer Side - 4.75% of gross per month. In the same example, the ESI contribution from the employer would be 8000 * 4.75% = Rs. 380.
Employees are required to fill out a declaration form, Form 1, clearly stating their gender as male or female. All declaration forms must be countersigned by the employer.
Subsequently, a return of declaration in Form 3 needs to be prepared separately for male and female employees within 10 days of filling out the declaration form.
Each employee will then be allocated a temporary identification number.
Regarding PF, it is contributed at a rate of 12% of the basic salary from both the employee and the employer. Out of the total 24% contribution, 8.33% goes to the Pension Fund, and the remaining 15.67% goes to the Provident Fund.
The ceiling for Provident Fund membership is Rs. 6500 basic per month. Even if an individual exceeds this ceiling, the contribution amount remains the same at 12% of Rs. 6500 basic.
In certain cases, contributions may be made on amounts exceeding the ceiling, but approval from the employer is required.
I hope this information helps you understand the details.
Regards,
Amit Seth