Dear Senior, good morning.
My question is this: If the salary of an employee is ₹18,000 gross every month and he receives ₹12,000 in overtime every month, making a total of ₹30,000 deposited in the bank monthly, how much will ESI and EPF be deducted from the salary?
Regards,
Monu Dhiman
From India, Yamunanagar
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1My question is this: If the salary of an employee is ₹18,000 gross every month and he receives ₹12,000 in overtime every month, making a total of ₹30,000 deposited in the bank monthly, how much will ESI and EPF be deducted from the salary?
Regards,
Monu Dhiman
From India, Yamunanagar
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Hi Monu Dhiman, You must deduct ESIC at Rs.30,000/- because the employee Fixed wage is under 21k. and you include the OT wages also. Also please aware about the OT wages act.
From India, Karur
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From India, Karur
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Rs 21,000 is the threshold limit for coverage and not for contribution. The gross salary does not consist of overtime wages, but it will be considered for contribution. Therefore, if in respect of a covered employee (if the gross salary is Rs 18,000, the employee would be a covered employee), the total earnings including overtime allowance will qualify for contribution. Thus, you have to deduct contribution on Rs 30,000 and contribute a contribution on the same 30,000. You can exclude only travelling/conveyance allowance. If you have provided a uniform, obviously, washing allowance can also be excluded from the contribution.
For the benefits payable to the employees, their total salary including overtime wages will be considered, and as such, the cash benefits that the employee receives will also be higher. Another reason for considering overtime wages for contribution is that the employee meeting with an accident during the extended time (overtime period) will get insurance coverage.
Caution: An employee is not expected to do overtime beyond a certain number of hours, and there are limits for overtime. It depends on state rules in this regard, and it should be around 75 hours in a quarter (of four months). Asking employees to do overtime over and above this is illegal.
From India, Kannur
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For the benefits payable to the employees, their total salary including overtime wages will be considered, and as such, the cash benefits that the employee receives will also be higher. Another reason for considering overtime wages for contribution is that the employee meeting with an accident during the extended time (overtime period) will get insurance coverage.
Caution: An employee is not expected to do overtime beyond a certain number of hours, and there are limits for overtime. It depends on state rules in this regard, and it should be around 75 hours in a quarter (of four months). Asking employees to do overtime over and above this is illegal.
From India, Kannur
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PF is to be deducted on canteen allowance - Delhi HC 22.7.2013.pdf
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