ESI Eligibility Change: What Steps Should We Take for an Employee Earning Over 22k?

Hi Everyone,

I have a little doubt regarding ESI. One of our employees is going to receive a salary above 22k from next month. As per ESI rules, ESI is not eligible for those who are receiving a salary above 21k. What should be our next step? Please help me.

As per ESI rules, if any employees come under ESI, they should pay the full contribution (e.g., 1st April to 30th September 1st half & 1st October to 31st March 2nd half) even if they exceed the ESI limit.

If the insured person crosses the coverage limit in the contribution period, they will continue to be covered under the ESI Act. If an employee's salary exceeds the ESI limit within the contribution period of April to September or October to March, they will remain a member until the end of the contribution period, namely September or March, as the case may be.

You can exclude an employee from ESI coverage consequent to an increase in salary, i.e., above Rs 21,000/- per month, effective from 01/10/2017.

ESIC contribution has been increased from Rs. 15000/- to Rs. 21000/- with effect from January 2017.