I’m working in Animation company, college students come to us for training for 3 to 4 months. We pay them 3000 as stipend, will they be included in ESI.
From India, New Delhi
5From India, New Delhi
There are different views with regard to such type of trainees. ESI Corporation will say that only Apprentices who are engaged under the Apprentice Act, 1961 are excluded. However, interns being trainees not in the rolls of the establishments but doing their project studies as part of curriculum may also be excluded. To support it you will have to produce letters from the College/ University to the effect that they are students and undergoing internship for three/ four months is mandatory for award of degree to them.
Regards,
Madhu.T.K
From India, Kannur
Regards,
Madhu.T.K
From India, Kannur
Apprentice refers to such trainees engaged as per the Apprentice Act. Apprentice Act has specified some designated trades in which trainees can be (rather it is mandatory to engage) engaged by industries and establishments. Such trainees (trade apprentices) will be registered under the Apprentice Adviser/ Apprentice Officer at the Related Instruction Centre in the respective district. Depending upon the trade the period of training may vary from one year to three years. Certain trades are considered as continuation of industrial training obtained by the candidates at the ITIs/ Polytechnics/ Food Craft Institutes and after completion of practical training at factories/ establishments they have to appear for an All India Trade Examination for the award of National Trade Certificate.
Those who have not undergone any basic training in ITIs also can be engaged as apprentices, but they should be registered under the above mentioned Apprentice Adviser. Practical training offered at the factory/ establishment should be as per the syllabus prescribed by the Government of India in this regard.
Stipend of apprentices will be fixed and revised by central government from time to time.
There are some trainees who are engaged as per provisions of the certified Standing Orders of the company. They are also excluded from the EPF. Recently all such trainees have been made covered by ESI.
All other trainees who are not engaged as per provisions of Apprentice Act or as per Certified Standing Orders of the company are trainees. For the purpose of enforcement and application of Labour Laws, these trainees are treated at par with any other employee of the company. Therefore, when the apprentices are paid stipend according to notification by the Govt. of India or when the trainees under the Standing Orders is paid stipend according to the provisions as such in the Standing Orders, the other trainees are to be paid wages/ salary following the Minimum Wages Act. Similarly, when apprentices and standing order trainees are excluded from EPF the other trainees are to be covered under the EPF. Certainly, Apprentices are excluded from ESI as well.
Regards,
Madhu.T.K
From India, Kannur
Those who have not undergone any basic training in ITIs also can be engaged as apprentices, but they should be registered under the above mentioned Apprentice Adviser. Practical training offered at the factory/ establishment should be as per the syllabus prescribed by the Government of India in this regard.
Stipend of apprentices will be fixed and revised by central government from time to time.
There are some trainees who are engaged as per provisions of the certified Standing Orders of the company. They are also excluded from the EPF. Recently all such trainees have been made covered by ESI.
All other trainees who are not engaged as per provisions of Apprentice Act or as per Certified Standing Orders of the company are trainees. For the purpose of enforcement and application of Labour Laws, these trainees are treated at par with any other employee of the company. Therefore, when the apprentices are paid stipend according to notification by the Govt. of India or when the trainees under the Standing Orders is paid stipend according to the provisions as such in the Standing Orders, the other trainees are to be paid wages/ salary following the Minimum Wages Act. Similarly, when apprentices and standing order trainees are excluded from EPF the other trainees are to be covered under the EPF. Certainly, Apprentices are excluded from ESI as well.
Regards,
Madhu.T.K
From India, Kannur
hi Garima,
You will have to deduct ESI if the act applicable in your organisation but if you pay them 3000 or less per month then both share employer have to pay. esi is a social security towards employees. He will not be your permanant employee but suppose if any casualty happens during his training period, without contribution he will not be eligible to get any kind of benifits.
Regards
Anil Kumar
From India, Lucknow
You will have to deduct ESI if the act applicable in your organisation but if you pay them 3000 or less per month then both share employer have to pay. esi is a social security towards employees. He will not be your permanant employee but suppose if any casualty happens during his training period, without contribution he will not be eligible to get any kind of benifits.
Regards
Anil Kumar
From India, Lucknow
Dear Garima,
You have not indicated whether the college students come to you while they are still studying or they come to you after completing their studies.
If they are coming to you while they are studying and the training being imparted by you is part of their college curriculum then as suggested by Madhu, you can obtain a bonafide certificate in respect of the students and you can refrain from payment of ESI.
On the other hand if they join you after completing their studies it is recommended the you pay the ESI contribution in respect of them. In the event you have any restrictions from your management on cash outflow i.e not more than Rs.3000/- then you need to build in the ESI contribution within the amount of Rs.3000/-.
However, if you decide to continue pay Rs.3000/- then you need to show the wages drawn as Rs.3210/- and after deducting Rs.209 towards 6.5% ESI contribution the employee will be getting Rs.3000/- on hand. Both the employee and employer contribution of ESI must be remitted to ESI to enable the employee to claim benefits.
In my opinion the second option will be advisable.
M.V.KANNAN
From India, Madras
You have not indicated whether the college students come to you while they are still studying or they come to you after completing their studies.
If they are coming to you while they are studying and the training being imparted by you is part of their college curriculum then as suggested by Madhu, you can obtain a bonafide certificate in respect of the students and you can refrain from payment of ESI.
On the other hand if they join you after completing their studies it is recommended the you pay the ESI contribution in respect of them. In the event you have any restrictions from your management on cash outflow i.e not more than Rs.3000/- then you need to build in the ESI contribution within the amount of Rs.3000/-.
However, if you decide to continue pay Rs.3000/- then you need to show the wages drawn as Rs.3210/- and after deducting Rs.209 towards 6.5% ESI contribution the employee will be getting Rs.3000/- on hand. Both the employee and employer contribution of ESI must be remitted to ESI to enable the employee to claim benefits.
In my opinion the second option will be advisable.
M.V.KANNAN
From India, Madras
Dear Garima,
No need for deduction of any ESI for Trainee worker and Second No overtime worked by him/her.
In case of any injury is caused to an apprentice, by accident arising out of and
in the course of his training as an apprentice, his employer shall be liable to pay compensation which shall be determined and paid, so far as may be, in accordance with the provisions of the workmen's Compensation Act,1923, subject to the modifications specified in the schedule.
And find the attached points , Hope same is helpful for you.
From India, Delhi
No need for deduction of any ESI for Trainee worker and Second No overtime worked by him/her.
In case of any injury is caused to an apprentice, by accident arising out of and
in the course of his training as an apprentice, his employer shall be liable to pay compensation which shall be determined and paid, so far as may be, in accordance with the provisions of the workmen's Compensation Act,1923, subject to the modifications specified in the schedule.
And find the attached points , Hope same is helpful for you.
From India, Delhi
Dear Garima,
i am agree with Madhu G.
Becose Trainees are covered only under Apprenticeship Act.
so if u have any trainees who are covered under Apprenticeship act they are not liable to covered under esic and if they not then you have to contribute ESIC
From India, Rudarpur
i am agree with Madhu G.
Becose Trainees are covered only under Apprenticeship Act.
so if u have any trainees who are covered under Apprenticeship act they are not liable to covered under esic and if they not then you have to contribute ESIC
From India, Rudarpur
Apprentice/Trainees are not covered, Okay. But the point is that how to wad of the liability on account of Employees Compensation Act (ECA)? If any mishap happen to any trainee during training, Principal Employer will be responsible for the compensation in whose premises the accident occurred. Paying ESI is just 6.75% but the compensation will be too burdensome. ESI takes care of the ECA.
So, it is advisable that the ESI may be paid. it is not a much of liability but a great relief. Who know what happens when? Accident do not come with an advance call.
From India, Chandigarh
So, it is advisable that the ESI may be paid. it is not a much of liability but a great relief. Who know what happens when? Accident do not come with an advance call.
From India, Chandigarh
Dear pal, Write the whole purpose of their in plant training along with letters from respective colleges to the ESI authorities and seek exemption from them. Thanks HC. SUBBARAMU Bangalore
From India, Kochi
From India, Kochi
Dear friends.........
To some extend only i can agree with the above comments.........
Our own interpretations will not serve the purpose in the eye of law.......since every employer will interprete the issues as per their convenience .......
But as far as ESI Act is concerned the exclusive part is only for APPRENTICE engaged under APPRENTICE ACT...................So rest of the persons who were engaged for ANY PURPOSE with ANY NOMENCLATURE.....U r supposed to extend the ESI to them........ Here the main point you have to understood is u r taking their services for not free of cost........but paying some thing but polished u r nomenclating as STIPEND............... another issue whether they are students or not or its coming as part of their Curriculam is different Y because, as far as U r taking their services and controlling them and supervising them.........In my concern all such people it may be internship or trainees.......finally the relation between u and him as far as work of the organisation is concerned its a MASTER-SERVANT relation only...of course it may fulfill 100% of the condition as applicable for other employees.......
Do anybody have the court judgement says that other trainees, either it may be industrial trainees or intership trainees or etc., (other than Apprentice) will not come under ESIC ?..................I hope no such judgement as of now........
The next point.........many of our HR friends are discussing about a point related to employees who draws Rs.3000 and below.......its my humble request please under the issue properly..........the person who draws Rs.3000 or less per month, they are called as exempted employees..........that means they are exempted for payment of their share, i.e. Employees Share of (1.75%)..........Dont be under the wrong impression that all 6.5% should be born by the Employer...................As their share is exempted for payment, in such employees......Employer has to pay ONLY HIS SHARE, i.e. 4.75% only...........
With best wishes......
From India, Hyderabad
To some extend only i can agree with the above comments.........
Our own interpretations will not serve the purpose in the eye of law.......since every employer will interprete the issues as per their convenience .......
But as far as ESI Act is concerned the exclusive part is only for APPRENTICE engaged under APPRENTICE ACT...................So rest of the persons who were engaged for ANY PURPOSE with ANY NOMENCLATURE.....U r supposed to extend the ESI to them........ Here the main point you have to understood is u r taking their services for not free of cost........but paying some thing but polished u r nomenclating as STIPEND............... another issue whether they are students or not or its coming as part of their Curriculam is different Y because, as far as U r taking their services and controlling them and supervising them.........In my concern all such people it may be internship or trainees.......finally the relation between u and him as far as work of the organisation is concerned its a MASTER-SERVANT relation only...of course it may fulfill 100% of the condition as applicable for other employees.......
Do anybody have the court judgement says that other trainees, either it may be industrial trainees or intership trainees or etc., (other than Apprentice) will not come under ESIC ?..................I hope no such judgement as of now........
The next point.........many of our HR friends are discussing about a point related to employees who draws Rs.3000 and below.......its my humble request please under the issue properly..........the person who draws Rs.3000 or less per month, they are called as exempted employees..........that means they are exempted for payment of their share, i.e. Employees Share of (1.75%)..........Dont be under the wrong impression that all 6.5% should be born by the Employer...................As their share is exempted for payment, in such employees......Employer has to pay ONLY HIS SHARE, i.e. 4.75% only...........
With best wishes......
From India, Hyderabad
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
PF,ESI WORKING SPECIMEN.xls