Is ESI Coverage Based on Gross Salary or Actual Earnings? Need Advice on Nov-24 Scenario

Mr. A is not a member of ESI until Oct-24. His gross salary is Rs. 26,000 per month.

In Nov-24, due to his 15 days of absence, he earned a gross salary of Rs. 13,000.

Is ESI applicable to him from Nov-24? Please suggest.

For coverage under ESI, the notional wages or the gross salary for 30 days (per month) should not exceed Rs 21,000. In this case, the earned wages for 15 days amount to Rs 13,000, but the notional wages, or the wages he would have earned if he had worked for 30 days, is Rs 26,000. Therefore, he is not eligible for ESI coverage.

If the gross salary is more than Rs. 21,000/- per month, the employee is considered an exempt employee. ESIC will not deduct from his salary if he has worked 15 days or less.

Regards, Sanjay Tiwari