Hi,
As per the ESI Act, it is calculated on the gross amount. To arrive at the gross amount, various pay elements are considered such as Basic, HRA, Conveyance, and Special pay (balancing figure after allocating the amount in other pay elements), etc. Since PF, ESI, and Gratuity are calculated after gross salary, and ESI is calculated on gross, I am encountering a circular reference while preparing the salary fitment in the spreadsheet.
Can anybody guide me on how to arrive at gross earnings as Special pay is the balancing figure?
I would appreciate an early response.
Thanks,
Nikita
From India
Acknowledge(0)
Amend(0)
4As per the ESI Act, it is calculated on the gross amount. To arrive at the gross amount, various pay elements are considered such as Basic, HRA, Conveyance, and Special pay (balancing figure after allocating the amount in other pay elements), etc. Since PF, ESI, and Gratuity are calculated after gross salary, and ESI is calculated on gross, I am encountering a circular reference while preparing the salary fitment in the spreadsheet.
Can anybody guide me on how to arrive at gross earnings as Special pay is the balancing figure?
I would appreciate an early response.
Thanks,
Nikita
From India
Acknowledge(0)Amend(0)
Hi Niki,
First of all, ESI is deducted from the gross amount, and in the gross amount only the basic and DA come; other heads come thereafter depending on your earnings and deduction heads. At the end, whatever amount you will get will be your net payable amount, which includes all earnings like HRA, Conveyance, Special Pay, and deduction heads like security, etc.
I hope you are clear now. For any help, keep in touch.
Ratikanta Rath (H.R)
From India, Delhi
Acknowledge(0)Amend(0)
First of all, ESI is deducted from the gross amount, and in the gross amount only the basic and DA come; other heads come thereafter depending on your earnings and deduction heads. At the end, whatever amount you will get will be your net payable amount, which includes all earnings like HRA, Conveyance, Special Pay, and deduction heads like security, etc.
I hope you are clear now. For any help, keep in touch.
Ratikanta Rath (H.R)
From India, Delhi
Acknowledge(0)Amend(0)
dear ESI is deducted on your gross salary ehich includes basic,HRA,conveyance,special pay,special allowance etc. tks j s malik
From India, Delhi
Acknowledge(0)Amend(0)
From India, Delhi
Acknowledge(0)Amend(0)
Dear,
ESI is applicable on all heads that appear on your salary/wage slips and are paid on a monthly basis. This applies to employees who draw a gross monthly salary of less than Rs 10,000.
Thank you.
Acknowledge(0)Amend(0)
ESI is applicable on all heads that appear on your salary/wage slips and are paid on a monthly basis. This applies to employees who draw a gross monthly salary of less than Rs 10,000.
Thank you.
Acknowledge(0)Amend(0)CiteHR is an AI-augmented HR knowledge and collaboration platform, enabling HR professionals to solve real-world challenges, validate decisions, and stay ahead through collective intelligence and machine-enhanced guidance. Join Our Platform.
SALARY SHEET CALCULATION.xls
Salary calculation.doc