Contribution is the
amount payable to the Corporation by the
principal employer in respect of an
employee and comprises the amount
payable by the employee and the
employer.
The scheme is
primarily funded by contribution raised
from insured employees and their
employers in the implemented areas as a
small but specified percentage of wages
payable to such employees.
The rates of
contribution as of now are:-
Employees’
contribution-1.75 percent of the wages
Employers’
contribution-4.75 percent of the wages
Total-6.50 percent of the wages
It is obligatory on the part of the employer
to calculate and remit ESI Contribution comprising
of employers' share 4.75% plus employees'
share of 1.75% which is payable on or before
21st of the following month, to the month to
which the salary relates. If the employee is
drawing upto Rs.50/- as daily average wage,
he is exempt from the payment of his share
of contribution. The employer is however to
pay employer's share of 4.75% of the salary
received/receivable by the employee.
The State Govt. bears one-eight share of
expenditure on medical benefits with in the per capita ceiling of Rs.1000/- per I.P. family per annum.
RECOVERY OF
CONTRIBUTION
In the first
instance the Principal Employer is to pay
employers' share of contribution in respect
of every employee whether employed directly
or through immediate employer. The
employees' share may thereafter, be
recovered by making deduction from their
wages for the wage period for which
contribution is, however is payable. No such
deduction may be made from any wages other
than those relating to the period in respect
in which contribution is payable.
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