In India, when two family members are working in the same company and both fall under the Provident Fund (PF) liability, it is essential to deduct the Employee State Insurance (ESI) contribution from both individuals. ESI is mandatory for all eligible employees, including family members, and skipping the deduction for one of them is not permissible under the law.
To ensure compliance and avoid any legal issues, here are the steps to follow:
Steps to Deduct ESI for Two Family Members in the Same Company
1. Verify Eligibility:
- Confirm that both family members meet the eligibility criteria for ESI coverage based on their wages and employment status.
2. Calculate ESI Contribution:
- Calculate the ESI contribution for each family member based on their individual wages. The current ESI contribution rate is 1.75% of the employee's gross salary, while the employer contributes 4.75%.
3. Deduct ESI Contributions:
- Deduct the ESI contributions from the wages of both family members as per the calculated amounts.
4. Submit ESI Payments:
- Ensure timely submission of the deducted ESI contributions to the ESI Corporation within the specified due dates.
5. Maintain Records:
- Maintain accurate records of ESI deductions for both family members, including contribution amounts, payment dates, and any related documentation.
By following these steps and deducting ESI contributions for both family members, you can comply with the legal requirements and ensure that both employees receive the benefits entitled to them under the ESI scheme. If you have any specific questions or need further clarification, it is advisable to consult with a legal expert or HR professional familiar with Indian labor laws.