Understanding ESI and PF Rules in Delhi: Are Both Mandatory for Low-Wage Employees?

Hello everyone,

I am working as an HR in a company. I always used to get a lot of information from this site. Now, I wanted to know more about ESI and PF as per Delhi rules:

- If an employee is receiving a salary of 7500 (peon), ESI is mandatory. Is PF also mandatory in this case?
- If labor wages are more than 15000, ESI is not applicable from both sides.

Hi Priyanka,

I believe the wages of Rs. 7500/- for a Peon in the Delhi location are less than the minimum wages. ESI and EPF have the same rules across India. If the salary is confirmed, both ESI and EPF are mandatory. If the gross wages are above Rs. 15000/-, then he/she is exempted from ESI but not from EPF.

Thank you for your reply.

I have one more question. I would like to know if we calculate EPF based on basic+DA, is an employee still eligible for PF if their salary is less than 15000?

PF is calculated on Basic + DA + Retaining allowances. If basic + DA is less than 15000/-, you have to contribute. Once the employee becomes a member, he has to continue even if his wages are above 15000.