Understanding EPF and ESIC Eligibility: How Do I Ensure Compliance for My Staff?

I am the admin manager for a newly formed establishment of a jewelry group. Our establishment consists of 18 staff so far, and I want to follow all legal rules and regulations properly from the beginning. For this, I need your help and suggestions regarding EPF and ESIC. I know the contribution rate of EPF and ESIC is 12% from both the employer and the employee for EPS, and 1.75% and 4.25% for ESIC.

Query on ESIC Eligibility

My query is regarding the number of staff required for eligibility for ESIC and under what conditions. We pay gross salaries of Rs. 10,000/-, 15,000/-, 20,000/-, and 25,000/-, out of which I have allocated only 25% as basic salary and the rest for other allowances like TA, HRA, Medical, CCA, and others. Now, please assist me in determining which employees among these pay scales should be included for EPF and ESIC. Kindly provide detailed assistance.

Thank you.

The employer's share of contribution under the ESI Act, 1948 is 4.75% of total wages and not 4.25% as mentioned by you in the above comments.

All employees receiving wages up to and including Rs. 15,000 per month will be covered under the ESI Act, 1948.

Before complying with the said Act, you will need to obtain an ESIC Code Number for your factory/establishment by submitting Form 01 to the appropriate Sub/Regional Office of ESIC. Ensure that your establishment/factory is located in an implemented area as notified under section 1(3) of the said Act and that it qualifies either as a 'factory' or another category of establishment as per the notification issued by the appropriate government under section 1(5) of the said Act.

After obtaining the Code Number, you must obtain Insurance Numbers for all covered employees by submitting Declaration Forms for such employees. Contact the nearest ESIC Branch Office for assistance.

Thank you.