Wages Ceiling Limit Under ESI
Hemlata Khandenwal / 2020-03-27 10:07:12

1. When an employee exceeds the salary ceiling limit, why should wages be paid the total wage beyond the limit?

An employee (who has ESI registration) that exceeds the prescribed ceiling limit at any time after the commencement of the contribution period shall remain an employee until the end of that contribution period. The rule position in this regard is as follows: -

According to Rule-50 of the ESI (Central) Rules, 1950, any employee whose contribution (excluding remuneration for overtime work) exceeds one month (fifteen thousand) at any time before and after the beginning of the contribution period Will be done Continue and Must be an employee by the end of that period. "

2. Will the late settlement draw any interest?

An employer failing to pay contributions within the limits prescribed under Regulation 31 shall be liable to pay simple interest at the rate of 12% per annum in respect of delayed or defaulted payments each day (Contribution 31-A).

3. What is the method of calculation and payment of contribution?

  • Employers have to file monthly contributions online through ESIC portal after monthly registration in respect of all their employees. Through this practice, employers are required to enter an employee-wise number, for which wages are paid to ascertain the number of contributions paid.

  • ESIC has facilitated the payment of online ESI contributions through 58 banks, the payment gateway of the employer besides SBI.

  • The total amount of contribution in respect of all employees (both shares) for each month is through the ESIC portal, the generation of challan can be deposited online at any branch of SBI. Credit ESIC facilitates online payment of ESI contribution through payment by employer gateway of 58 banks apart from SBI.

4. Why should an employee be excluded from the salary ceiling for over-time coverage?

Overtime is not a regular and continuous payment but is occasional. If overtime is also taken for the wage limit for coverage of an employee, it may be out of coverage for some time and again within the scope of the plan if not overtime. However, this includes overtime work to contribute to cover the risk during that period, and at the same time enables him to attract cash benefits at an increased rate.

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