sub- ESI contribution when wage exceeds Rs 15000/-p.m
In the instant case, the employee’s wages did not exceed Rs.15,000/- p.m. on the 1st April which is the beginning of the contribution period (The contribution period is between 1st April and 30th September.). It means he is an employee at the beginning of the contribution period but his wages exceeded Rs.15000/- p. m. from June, thereby meaning that though he is an employee under the Act at the beginning of the contribution period, he ceased to be an employee from June within the meaning of the above section.
The question is whether the said employee ceased to be an employee within the meaning of Sec. 2 (9) from June onwards and the need to pay his contribution can be dispensed with.The answer to this puzzling question lies in the Proviso to Sec. 2(9). It says that an employee continues to remain as an ‘employee’ if his wages were within the limit at the beginning of the contribution period even though his wages exceed the ceiling limit (Rs.15,000/-) at any time after the beginning of the contribution period. Thus, in the instant case, the employee is eligible for disablement benefit on the basis of the explanation.
In this connection please refer to ESI Corporation v. Doddaiah & Others (Karn H.C) 2002 I LLJ 979.In this case, an employee was held not eligible for medical benefits under the Act since his wages were raised beyond the then wage limit of Rs.1,600/ p.m. (the then wage limit) on the first day of April (i.e. beginning of the contribution period).
B.Saikumar
HR & labour Law Consultant
Chipinbiz Consultancy Pvt Ltd.
Mumbai