Is a Worker Eligible for ESI if Absence Lowers Their Monthly Wage Below 21,000?

A workman with fixed wages of 25,000 per month (for 26 days) is not eligible for ESI coverage if he goes on leave or is absent, causing his wages to fall below 21,000. In this case, whether he is eligible for ESI coverage or not is a matter of concern.

I have discussed this issue with many officials, all of whom have different opinions. Seniors, please shed light on this matter.

ESI coverage is determined by the notional wages principle. If the (notional) wages exceed Rs. 21,000 when an employee works for the entire month, such as 26 or 30 days, he will be excluded from ESI coverage. In the following month, if his salary drops to less than Rs. 21,000, the number of days present would also decrease, and therefore, there is no need to cover him because his notional wages are still above Rs. 21,000.

Please note that if the employee receives any conveyance allowance, that allowance may be deducted from the gross salary to determine his eligibility for coverage under ESI.

Maternity Benefits by ESI
Maternity benefits provided by the Employee's State Insurance (ESI) scheme include paid leave during pregnancy and after childbirth. The ESI Act, 1948, mandates that employees covered under the ESI scheme are entitled to maternity benefits. These benefits typically include paid maternity leave for a certain duration before and after childbirth. The salary during this period is usually a percentage of the employee's average daily wage.

Eligibility for Maternity Leave Salary
Employees who contribute to the ESI scheme are eligible for maternity benefits. Both the employer and employee make contributions to the ESI fund, which enables employees to avail of benefits such as maternity leave salary. It is important for employers to ensure compliance with ESI regulations to provide these benefits to eligible employees.