New Employees with CTC 15,500 and 18,000: Can I Deduct EPF or Only ESIC?

Dear Seniors,

I have appointed two new employees with CTCs of 15,500 and 18,000. They have never been onboarded for EPF and ESIC in their previous jobs. Can I deduct EPF or ESIC from my company? Or should I only deduct ESIC since they are outside the EPF range? Please assist me in calculating this.

Regards,
Sidharth

Madhu Sir, What if I have to bifurcate the above salary into Basic + DA, HRA, and Extra Work Allowances for ESIC only?

No benefit at all because for ESI, all these components will be treated as part of wages only.

What is the extra work allowance?

Is it an overtime allowance? Naturally, you cannot fix the overtime allowance and mention the same in the contract of employment. It is variable according to work, and for coverage and out of coverage, the overtime amount will not be counted as wages. However, for contribution purposes, it will be considered as part of wages qualifying for contribution to ESI.