ESIC Eligibility Confusion: Does High Income in a Few Months Affect Future Coverage?

Dear Seniors, a very good morning to you. I am having a problem regarding ESIC exemption. According to ESIC, if an employee earns more than INR 15,000 in gross wages, they will not be eligible for ESIC.

Question on ESIC Eligibility

My question is, if an employee receives gross wages exceeding INR 150,000 (wage + O.T) in two or three months within a half-yearly contribution period (April to September, October to March), will they be eligible for ESIC in the following month or contribution period? Your reply would be greatly appreciated.

Thanks & Regards,
Nitin Sharma

Hi,

You can contact near ESIC office; in my view, only fixed wages are considered in gross wages. Therefore, overtime (OT) pay is not given on a regular basis. Please confirm this with the ESIC authority.

During a contribution period, excluding overtime wages, if an employee's gross wages are above Rs15,000 per month, they can be exempted from the beginning of the next contribution period.

I do agree with Mr. Varghese Mathew's view. For eligible conditions, the standard wages earned by the employee should be considered. The fluctuation due to variation in salary, such as overtime and other payments that are not constant, will not be considered for deciding the coverage under ESI.

To be on the safer and more convenient side, you may contribute towards wages up to ₹15,000. That way, your IP will also continue to remain insured.

Thank you.