Employees' State Insurance (ESI)
Employees' State Insurance (ESI) is a multidimensional social security system administered by the Employees' State Insurance Corporation (ESIC) under the Ministry of Labour and Employment. It provides full medical care and cash compensation for sickness, maternity, disablement, and death due to employment injury.
Statutory Contribution Formula (Total: 4.00%)
Employee Share
0.75%
Deducted from monthly Gross Wages
Employer Share
3.25%
Paid by company into ESIC pool
1. Applicability & Wage Threshold
- Establishment Coverage: Applies to non-seasonal factories employing 10 or more persons, and shops, hotels, restaurants, transport, and private medical/educational institutions.
- Gross Wage Ceiling: Employees earning a monthly Gross Salary of up to ₹21,000 are mandatorily covered. For employees with benchmark disabilities, the ceiling is ₹25,000.
- Mid-Period Wage Hike Rule: If an employee's gross wages exceed ₹21,000 during an active contribution period (April–September or October–March), they remain covered until the end of that contribution period.
2. Practical Calculation Example
For a worker earning a Monthly Gross Salary of ₹18,000:
• Employee Deduction (0.75%): ₹18,000 × 0.0075 = ₹135 / month
• Employer Contribution (3.25%): ₹18,000 × 0.0325 = ₹585 / month
• Total Remittance to ESIC: ₹135 + ₹585 = ₹720 / month
Calculate Your Exact EPF & ESI Splits
Automatic statutory ceiling checks and employer/employee breakdowns.