Confused About ESI Contribution Rates in Andhra Pradesh? Need Help with 4% vs 6.5% Dilemma

Dear Members,

We have a manpower contract in the newly ESI notified area in Andhra Pradesh. We obtained a sub-code for this but are unable to make contributions at 4%. The contributions are being paid online, and the software automatically calculates them at 6.5%.

Please assist me in understanding how to make contributions at 4%, or if it is not applicable for the sub-code unit.

Regards,
Rajendra

Please go through this circular where everything is clarified: [ESIC Circular](http://esic.nic.in/backend/writereaddata/file/f487dc7d60ba3d5c857c0fe753df22ba.pdf)

New Rule Under Employee State Insurance Scheme

A new rule has been introduced under the Employee State Insurance Scheme. It states that in areas where the scheme is implemented for the first time, the employer's and employee's contributions would be as follows for the initial period of 24 months from the day it's implemented.

- Employer: 3% of wages payable to the employee, rounded up to the next higher rupee.
- Employee: 1% of wages payable to the employee, rounded up to the next higher rupee.

After the completion of the aforementioned 24 months, the rate of contribution will revert to the existing rates, i.e., 4.75% for the employer and 1.75% for the employee.