ESI and PF Deductions for Layoff Wages: Are They Required and What Laws Apply?

Aravindh Thamaraiselvan
ESI and PF Deductions for Layoff Wages

It is necessary to pay ESI and PF deductions for layoff wages. If yes, kindly mention any laws regarding these layoff wages.
kumaracme
Layoff wages are wages to be considered for deducting EPF and ESIC contributions. The following are the directions given by the ESIC Regional office on the deduction of ESIC contributions on layoff wages. Hence, you should follow the same.

https://www.esic.nic.in/wages

Wages Paid During Layoff

During the period of layoff, though the employee is not given actual work and is also not given full remuneration, certain wages are paid to the employee by way of remuneration for remaining attached to the factory/establishment of the employer. Therefore, such payments paid for the period of layoff are also wages for the purpose of Sec.2(22) of the ESI Act, and hence contribution is payable on such payments.

(Earlier instructions were issued in 1968).
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