Query w.r.t ESI:- Certain class of workers getting, Monthly salary+special incentive=CTC (as per appointment letter) I.e., 18000+9000=27000/-(more than 21000- out of ESI Limit), Now looking to COVID Pandemic situation organisation has decided to deduct Special Incentive then worker will get 18000 payout (this is less than 21000- ESI Limit), this situation 18000 payout may continue for 2 to 3 months and impact will be on 1000 workers then Query: IS IT REQUIRES TO GO FOR ESI REGISTRATION? ... Regards
Are you not already registred. ESI Act requires for mandatory registration if number of employees exceed 10 irrespective of wages/salaries being paid to each of employee. Whether or not contribution is required to be made is a subsequent question.
Coming to your query. Contribution to ESI is mandatory where total salary of an employees is less than 21000.00. Total salary in this regard is to be treated as total Salary Payable for a month and not Total Salary earned in a month. For example an employees getting a monthly salary of Rs. 50000.00 is exempt from making contribution even if he attends office for a week only in a particular month and earns Rs. 12500.00
Similary in your case if total salary of employees is in excess of thresh hold limit, and actual salary earned by such employees in a particular wage period is less than thresh hold limit will not make them liable for contribution for such month.