EMPLOYEE COMPENSATION UNDER ESI & PF

FILMA VARGHESE TRADEMARK DEPARTMENT

ALTACIT GLOBAL

ESI AND PF

COMPARISON BETWEEN ESI & PF ESI PF

APPLICABILITY The establishment which is employing more than 10 persons and using power for his manufacturing process orThe establishment which is employing more than 20 persons and not using power for his manufacturing process Under Section 1(5): State Governments have extended the provisions of the ESI Act to the following classes of establishments. •Shops•Hotels & Restaurants•Cinemas including preview theatres•Road motor transport undertakings•Newspaper Establishments

All the establishments employing 20 or more persons. The Central Government has residual powers to apply this act to any establishment employing less than twenty employees.

AREAS COVERED

The ESI Scheme is being implemented area-wise by stages. The Scheme has already been implemented in different areas in the following States/Union Territories STATES - All the States except Nagaland, Manipur, Tripura, Sikkim, Arunachal Pradesh and Mizoram.UNION TERRITORIES - Delhi, Chandigarh and Pondicherry

Extends to whole of India except the State of Jammu & Kashmir and also the State of Sikkim where it has not been notified so far after its annexation with the Union of India.

ELIGIBILITY Wage-limit is Rs.10, 000/- per month (with effect from 1.10.2006).All allowance except washing, conveyance allowance would be considered as wages for the purpose of applicability of the Act.

An employee at the time of joining the employment  and getting wages up to Rs.6500/- Every employee becomes eligible for joining the scheme from the date of joining the service.

COMPARISON BETWEEN ESI & PF ESI PF

CONTRIBUTION RATE

Employee contribution – 1.75% of the wages (w.e.f. 1.1.97)Employer’s contribution – 4.75% of the wagesEmployees in receipt of a daily average wage up to Rs.50/- are exempted from payment of contribution. Employers will however contribute their own share in respect of these employees.

Both the employees and employer contribute to the fund at the rate 12% of the basic wages, dearness allowance and retaining allowance if any payable to employees per month.

CONTRIBUTION PERIOD

1st April – 30th September 1st October – 31st March

Contribution for the current month is deposited in the subsequent month

BENEFIT PERIOD 1st January – 31st June1st July – 31st December

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ESI PFCONTRIBUTION RATE

Employee contribution – 1.75% of the wages (w.e.f. 1.1.97)Employer’s contribution – 4.75% of the wagesEmployees in receipt of a daily average wage up to Rs.50/- are exempted from payment of contribution. Employers will however contribute their own share in respect of these employees.

Both the employees and employer contribute to the fund at the rate 12% of the basic wages, dearness allowance and retaining allowance if any payable to employees per month.

CONTRIBUTION PERIOD

1st April – 30th September 1st October – 31st March

Contribution for the current month is deposited in the subsequent month

BENEFIT PERIOD 1st January – 31st June1st July – 31st December

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ANNUAL CONTRIBUTION FOR THE PERIOD

- Is from 1st of March to 28/29 of Feb

BENEFITS TO EMPLOYEE

Medical benefitMedical benefit after retirementSickness benefitMaternity benefitDisablement benefit Temporary Disablement benefit Permanent Disablement benefitFuneral expensesDependent’s benefit

RetirementMedical careHousingFamily obligationFinancing of insurance polices

BENEFITS TO EMPLOYER

Employer exempted from the applicability of the ESIC for Medicare facility, Maternity Benefit Act, Workmen’s Compensation Act

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EMPLOYEES STATE INSURANCE

EMPLOYEES STATE INSURANCE

EMPLOYEES STATE INSURANCE

TYPES OF BENEFITS - PFTYPES OF BENEFITS

ELIGIBILITY ELIGIBLE AMOUNT FORM DOCUMENTARY SUPPORT

Advance from the fund for repayment of loan

10 years membership of the fund and member should have taken loan from the government body

36 months wages (Basic + DA) or Members own share of contribution + Company’s share of contribution with interest thereon

31 A certificate from the lending authority furnishing the details of loan and outstanding amount

Advance from the fund for illness

Stay in hospital at least for a month

6 months wages (Basic + DA)

31 A certificate from the medical practitioner for hospitalization or operation

Advance from the fund for marriage / Advance from the fund for education

17 years membership of the fund and minimum balance in member’s account should be Rs. 1000/-

50% of member’s own share of contribution

31 Declaration by the member which is attested by the employer

Grant of advance in abnormal conditions, Natural calamities etc

Certificate of damage from appropriate authority, State Government declaration

Rs. 5000/- or 50% of member’s own share of contribution (To apply within 4 months)

31 Certificate of damage from appropriate authority

To physically handicapped member for purchase of an equipment required to minimize the hardship on account of handicap

Production of medical certificate from a competent medical practitioner to the effect that he is physically handicapped

Basic wages + DA for six months or own share of contribution with interest or cost of equipment whichever is least

31 Certificate from the medical practitioner to the effect that the member is physically handicapped.

PROVISIONS UNDER PF

EMPLOYEES STATE INSURANCE

PROVIDENT FUND

CASE STUDY

CASE STUDY