Introduction
The Employees’ State Insurance Corporation (ESIC) has recently released a new contribution rate for 2019. This new rate is applicable to all employers and employees who are covered under the Employees’ State Insurance Act, 1948. The new contribution rate is 3.25% for employers and 0.75% for employees. This new rate is applicable from 1st April 2019 and will be applicable for the entire financial year. This notification has been released in the form of a Gazette Notification and is available for download on the official website of the ESIC. This article provides an overview of the new contribution rate and the Gazette Notification.
Download ESIC New Contribution Rate 2019 Gazette Notification [3.25% & 0.75%]
You can download the ESIC New Contribution Rate 2019 Gazette Notification from the official website of the Employees’ State Insurance Corporation (ESIC). The notification can be found under the ‘Notifications’ section of the website. The notification is available in PDF format and can be downloaded for free.
The central government after consultation with Employee State Insurance Corporation (ESIC) has reduced the ESIC contribution rates to 3.25% (employer contribution) and 0.75% employee contribution, this has happened after 22 years and these reduced ESI contribution rates increase the in hand salary of the employees. These new contribution rates are effective from 1 July 2019. Here is the official gazette notification of reduced ESIC new contribution rates 2019 in PDF format.
Download Reduced ESIC Contribution Rate Gazette Notification PDF
The main aim of this decision is to bring more number of employees under ESI scheme, there are more than 3.6 crores of employees and 12.85 lakhs of employers are going to benefit with these new contribution rates.
ESIC Contribution Rates Old & New
Till now employer is contributing 4.75% and the employee is contributing 1.75% of total gross salary towards ESIC & we all know ESI is applicable to employees whose monthly gross is equal to or less than 21000 Rs.
So a total of 6.50% of employee gross salary is going to ESIC, it is really a huge amount if these rates are decreased it will reduce some burden to employee and employer. Now the total ESIC contribution has reduced to 5% and it increases the in hand salary of the employees.
Old ESIC contribution rates
- Employer contribution 4.75%
- Employee contribution 1.75%
- Total Contribution 6.50%
New ESIC contribution rates
- Employer contribution 3.25 %
- Employee contribution 0.75%
- Total contribution 4%
Use of new ESI contribution rates
If the ESIC contribution rates decrease then the in hand salary of employees will increase and for employers also it reduces some burden. The reduced ESIC contribution rates motivate employers to bring more employees in employee state insurance scheme.
Affect on ESIC benefits
No, there is no affect on ESIC benefits. All the benefits for ESIC members will remain the same and the reduction in ESIC contribution rates is only to bring more employees in ESIC scheme.
Eligibility for ESI scheme
Employees whose monthly gross salary is 21000 or below 21000 Rs are eligible for employee state insurance scheme. Here is the notification on ESI eligible salary limit.
ESIC Contribution Calculation as per Reduced Contribution Rates
For example, if an employee’s monthly gross salary is 18000 Rs then ESIC will be calculated in the following manner.
Employee contribution 0.75% = 18000 x 0.75% = 135 Rs
Employer contribution 3.25% = 18000 x 3.25% = 585 Rs
Total contribution = 720 Rs
How ESIC collects contributions
Every employer needs to make ESIC contribution payments within 15 days after the following month. If employers aren’t able to pay ESIC contribution on or before ESIC due date then they need to pay penalties.
Employers need to login to their ESIC employer portal at the esic.in website. After login, they need to enter the ESIC contributions of their employees by clicking on pay monthly contributions or they can also upload a bulk excel sheet of all the employees contributions. Once they upload the excel sheet then a challan will generate. Now employers need to make the payment of that ESIC challan.
Employees who have contributed for ESIC will be eligible for ESIC cash benefits in ESIC beneficial period, here is the table of ESIC contribution period and cash benefit period.
ESIC New Contribution Rate 2019 Gazette Notification
The Employees’ State Insurance Corporation (ESIC) has recently released a Gazette Notification regarding the new contribution rate for 2019. According to the notification, the contribution rate for employers and employees has been revised to 3.25% and 0.75% respectively.
The notification states that the new contribution rate will be applicable from 1st April 2019. The notification also states that the new contribution rate will be applicable to all establishments covered under the Employees’ State Insurance Act, 1948.
The notification further states that the new contribution rate will be applicable to all employees who are covered under the Employees’ State Insurance Act, 1948. The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019.
The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019. The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019.
The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019. The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019.
The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019. The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019.
The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019. The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019.
The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019. The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019.
The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019. The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019.
The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019. The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019.
The notification also states that the new contribution rate of 3.25% and 0.75% will be applicable to all establishments covered under the Employees’ State Insurance Act, 1948. This new contribution rate will be applicable from 1st April 2019.
The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019. The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019.
The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019. The notification also states that the new contribution rate will be applicable to all employees who are employed on or after 1st April 2019.
The notification also states that the new contribution rate of 3.25% and 0.75% will be applicable to all establishments covered under the Employees’ State Insurance Act, 1948. This new contribution rate will be applicable from 1st April 2019.
The Employees’ State Insurance Corporation (ESIC) has taken this step to ensure that the employees are provided with adequate social security benefits. This new contribution rate will help the employees to get better benefits and will also help the employers to manage their costs.
