Can we deduct ESIC contribution above the ceiling limit of Rs.21000?
From India, Delhi
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From India, Delhi
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Impact of ESI Contribution Above 21K
Remittance of ESI contribution above 21K may lead to benefit rejection when an employee applies for ESI benefits, including maternity benefits.
We have employees who earn 19K and 20K as fixed gross earnings. However, due to production-related incentives, overtime wages, and night shift allowances, which are not standard every month and are paid based on certain criteria, their gross earnings can exceed the fixed amount.
This situation impacts many employees as their payable gross crosses 21K (including fixed and additional earnings), resulting in the rejection of any ESI benefits even after providing all the evidence and explanation with the last hike letter/appointment letter CTC + one-time component breakup.
Possible Solutions
However, it seems there is an option for a specific category to include a part of ESI above 21K that you need to check.
From India, Bengaluru
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1Remittance of ESI contribution above 21K may lead to benefit rejection when an employee applies for ESI benefits, including maternity benefits.
We have employees who earn 19K and 20K as fixed gross earnings. However, due to production-related incentives, overtime wages, and night shift allowances, which are not standard every month and are paid based on certain criteria, their gross earnings can exceed the fixed amount.
This situation impacts many employees as their payable gross crosses 21K (including fixed and additional earnings), resulting in the rejection of any ESI benefits even after providing all the evidence and explanation with the last hike letter/appointment letter CTC + one-time component breakup.
Possible Solutions
However, it seems there is an option for a specific category to include a part of ESI above 21K that you need to check.
From India, Bengaluru
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SC Judgment-No obligation to excess contribution than Statutory Limit.docx
ESIC-Contributi on-Transfer-For m.pdf
ESIC Wage Limit Increased.JPG