Finance/Compliance Consultant
77990 Points
Posted on 06 November 2026
Corrections and rules:
• The rate is no longer 4.75%. Since 1 July 2019 the employee pays 0.75% and the employer 3.25% (4% total) of wages paid.
• Coverage is decided at the start of each contribution period (1 April–30 September; 1 October–31 March). If gross wages (rate of wages) were Rs 21,000 or less (Rs 25,000 for persons with disability) at the start, the employee stays covered for the whole period, even if wages later exceed the limit.
• Contribution is on wages actually paid or payable for the days worked. For 20 days (Rs 12,000 paid): employee Rs 90, employer Rs 390.
• Gross Rs 18,000 is within the Rs 21,000 limit, so the employee is covered. In the next month, with Rs 18,000 paid for 30 days, contributions are on Rs 18,000.
• Employees earning up to Rs 176 a day (average daily wage) are exempt from their own share; the employer still pays.
• Under the Code on Social Security, 2020 (in force from 21 November 2025), ESIC coverage continues, with the wage definition including the 50% exclusions cap. Check the revised wage computation for allowance-heavy structures.