Understanding ESI Eligibility: Do Monthly Bonuses Affect the Rs. 21,000 Salary Cap?

anuradhagrewal

Hi,

What are the wage components under the ESI Act to arrive at a monthly salary of Rs. 21,000? If we pay statutory bonus on a monthly basis, then these employees' gross monthly salary will be more than Rs. 21,000. Will they still be eligible under ESI?

Please clarify.

vmlakshminarayanan

Hi,

ESI is calculated on gross earnings. If gross earnings exceed 21k, then ESI coverage is not required.

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