ESI Eligibility

rajeshwar78
I have Gross salary below Rs.15000 and had ESI. During April & May 2013 I earned more than Rs.15000 with performance linked allowance (PLA) and my employer stopped ESI contribution. From June 2013 again my gross & take home is below Rs.15000. Why I am not eligible for ESI from April 2013. Is it ESI insurance is on and off insurance based on salary during contribution months of April and October. Per my knowledge only gross is considered for ESI eligibility but not gross+ PLA, which is earned on performance,though, PLA will be paid every month if performance is met. Please reply.
Ro
This is true that only Gross is parameter for ESIC contribution
i would like to know one more aspect were you deducted for your esic contribution for that period in which you earned more than 15K (Gross +PLA)
Currently , an employee covered under the scheme has to contribute 1.75% of the wages whereas, an employer contributes 4.75% of the wages payable to an employee. The total contribution in respect of an employee thus works out to 6.50% of the wages payable.Total Salary includes Basic+DA+Conveyance+other allowance+PF+bonus.Total salary exceeds Rs.15000/Month are exempted from payment of contribution. These rate and exemption limit will be changed time to time.
Any deduction from Employee and not from Employer may also indicate if the company did not follow the proper compliance regulation.
fc.vadodara@nidrahotels.com
It is a wrong practice, kindly get in touch with your HR there must be some mistake or skipped out or maybe the payroll software must not be compatible with the statutory norms. Kindly update after confirmation
rajeshwar78
Thanks for the reply. Either employer or employee contribution was not deducted from April 2013, so I believe my ESI was lapsed. My question was "Will ESI lapse when an employee earns more than Rs.15000 (Gross+PLA/variable allowance). PLA/variable allowance is not guaranteed pay but can be earned by employee with performance every month,otherwise, only gross is paid that is below Rs.15000. I hardly earn above Rs.15000.
fc.vadodara@nidrahotels.com
Kindly confirm the forum whether the ESI of June has been deducted from your salary. If it is deducted then for 2 months the ESI has to be deducted which was a lapse from your HR. If ESI is not deducted in June and July salary bring it in the notice of HR
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