Dear Seniors, Kindly clarify the following.
Can we exclude leave wages (monthly payment) and statutory bonuses (monthly advance payment) from the ESI threshold limit?
Ex- Total Gross Rs.23,000 (inclusive of leave wages & Statutory bonus). If we exclude LW Rs.1000 & bonus Rs.1000, can we cover the employee under ESI. If yes, pl share your valuable comments with proof.
Thanks
V.Annakumar
From India, Pondicherry
Can we exclude leave wages (monthly payment) and statutory bonuses (monthly advance payment) from the ESI threshold limit?
Ex- Total Gross Rs.23,000 (inclusive of leave wages & Statutory bonus). If we exclude LW Rs.1000 & bonus Rs.1000, can we cover the employee under ESI. If yes, pl share your valuable comments with proof.
Thanks
V.Annakumar
From India, Pondicherry
First of all let me say that you cannot pay "leave wages' included in the wages. You can pay it separately as it is leave surrender which is an employee benefit and not part of remuneration. Second, you cannot pay advance of bonus along with wages. It should be paid separately as Bonus advance. Now, after excluding these two payments, if the wages comes within Rs 21000, then the employee will be under ESI. Obviously, if you have a component called travelling or conveyance allowance or washing allowance then that components should also be excluded from wages to decide the coverage as well as contribution.
From India, Kannur
4250From India, Kannur
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LEAVE ENCASHMENT NOT INCLUDED IN WAGES FOR P. F. CALCULATION.pdf
HC MAD 07 LEAVE ENCASHMENT NO WAGES.doc