dear mr kapoor,

THE FIRST STEP IN THE PROCESS IS THE OBTAINING OF PARTICULARS ABOUT EACH COVERABLE FACTORY/SHOP/ESTABLISHMENT, AND ITS IDENTIFICATION BY ALLOTMENT OF A NUMBER I.E. CODE NO. BY THE R. O. SO AS TO FACILITATE KEEP TRACK OF CONTRIBUTIONS PAYABLE/PAID AND THE CONNECTED OBLIGATIONS OF THE EMPLOYERS. SUBSEQUENT STEP IS THE REGISTRATION OF EMPLOYEES OF COVERED FACTORIES BY THE R. O/L. O. (WHERE THE WORK OF REGISTRATION OF EMPLOYEES IS DECENTRALISED), AND IDENTIFYING THEM BY ALLOTMENT OF A NUMBER I.E., INSURANCE NUMBER, AND SETTING UP OF NECESSARY RECORDS FOR RECORDING THE BENEFITS FOR WHICH THE INSURED EMPLOYEE MAY BE ENTITLED UNDER THE SCHEME ACCORDING TO ELIGIBILITY. INDIVIDUAL RECORD OF EACH EMPLOYER/EMPLOYEE WILL FACILITATE NECESSARY CHANGES IN FUTURE FROM TIME TO TIME AND PROPER WATCH FOR OBTAINING COMPLIANCE FROM THE EMPLOYERS AND BENEFITS TO CONCERNED INSURED PERSONS.

RE: ESI REGISTRATION

PFA ESI REGISTRATION FORM. SUBMIT IT ALONG WITH FOLLOWING DOCUMENTS:--

ALONG WITH DEEDS/AGREEMENTS/DOCUMENTS/CERTIFICATE:

(A) REGISTRATION CERTIFICATE/LICENCE ISSUED UNDER SHOPS AND

      ESTABLISHMENT ACT OR FACTORIES ACT.

(B) LATEST RENT BILL OF THE PREMISES YOU ARE OCCUPYING

     INDICATING THE CAPACITY IN WHICH THE PREMISES IS OCCUPIED,
    IF APPLICABLE.
(C) LATEST BUILDING TAX/PROPERTY TAX RECEIPT (ZEROX).

(D) MEMORANDUM AND ARTICLES OF ASSOCIATION/PARTNERSHIP DEED/TRUST DEED.

(E) ZEROX COPY OF CERTIFICATE OF COMMENCEMENT OF      

      PRODUCTION AND/OR REGISTRATION NO. OF CST/ST.

(F) LIST OF EMPLOYEES EMPLOYED IN COMPANY.
(G) LIST OF DIRECTORS
(H) CANCELLED CHEQUE (PROOF OF BANK)
(I) COPY OF INCOME TAX PAN

Hi,

Let me know the meaning of wages under ESI act, and wages includes ( Components) please.

Ravindra

Wage for purpose of ESI Act - ‘Wages’ means all remuneration paid or payable in cash to employee according to terms of contract of employment and includes any payment made to an employee in respect of period of authorised leave, lock-out, lay-off, strike which is not illegal and other additional remuneration paid at interval not exceeding two months. It does not include * contribution paid by employer to any pension fund or provident fund * Travelling allowance * Reimbursement of expenses made by nature of employment of the employee * gratuity. [section 2(22)].

Thus, wages include basic pay, dearness allowance, city compensatory allowance, payment of day of rest, overtime wages, house rent allowance, incentive allowance, attendance bonus, meal allowance and incentive bonus. However, wages do not include annual bonus, unilateral rewards scheme (inam), ex gratia payments made every quarter or every year travelling allowance, retrenchment compensation, encashment of leave and gratuity.

"Wages" means all remuneration paid or payable in cash to an employee, if the terms of the contract of employment, express or implied, were fulfilled and includes any payment to an employee in respect of any period of authorized leave, lock out, strike which is not illegal or layoff and other additional remuneration, if any, paid at intervals not exceeding two months, but does not include :-

a)    Any contribution  paid by the employer to any pension fund or provident fund, or under this act;

b)    Any traveling allowance or the value of any traveling concession;

c)     Any sum paid to the person employed to defray special, expenses entailed on him by the nature of his employment; or

d)    Any gratuity payable on discharge.         

The above definition has three parts.

1.      All remuneration paid or payable in cash to an employee flowing from the term of employment (including agreement) express or implied. The periodicity of payment is not relevant in this case.

2       Any additional remuneration even if not flowing from any agreement or settlement but paid at intervals not exceeding two months.

3.      The exceptions as provided in clause (a) to (d) above.

4.      Any remuneration paid or payable under Para 1and 2 is wages and chargeable to contribution whereas any amount paid towards items mentioned in clause (a) to (d) are not wages and therefore no contribution is chargeable on that amount.

The following items will form part of the wage both under Section 2(9) i.e. for considering the employee for the purpose of coverage and Section 2(22) of the ESI Act for the purpose of charging of contribution:-

1.        Matinee allowance which is being paid to employees in Cinema Houses.

2.        Shift allowance paid to employees who work on shift duty at odd shifts.

3.        Location allowance paid, in addition to Dearness Allowance to meet the high house rent.

4.        Compensatory allowance.

5.        Cash handling allowance paid to Cashier.

6.        Supervisory Allowance.

7.        Additional pay paid to training staff.

8.        Charge allowance

9.        Steno/Typist allowance

10.     Plant allowance

11.     Honorarium for looking after the hospital/dispensary

12.     Computer allowance

13.     Gestetner/Photocopier/Printer allowance

14.     Personnel/Special allowance

15.     Machine allowance

16.     Canvassing allowance

17.     First-aid allowance

18.     Personnel allowance – Pay over and above the basic wage and Dearness allowance for skill, efficiency or past good records.

19.     Area allowance - given to employees living in a particular area to meet the high cost of living in that area.

20.     Ex-GRATIA payment if payment is made within an interval of two months.

21.    MEDICAL ALLOWANCE

            The employees working in factories/establishments are being provided medical services in kind by the employer but in certain factories/establishments instead of providing        medical services in kind, the amount spent by the employees on medical care is reimbursed while in some other organizations, employees are being paid monthly cash allowance in lieu of medical aid/reimbursement of medical expenses. Where such payments are made by the employer in lieu of the medical benefit, the same are to be treated as wages under Sec.2(22) of the ESI Act and the contribution is chargeable

       22.      OVERTIME ALLOWANCE

           In the case of the employer as and when the employer finds the need to have work done expeditiously, in addition to the normal work during the course of the working hours, the employer offers to the employee to do the overtime work after the working hours. When employee does overtime work it amounts to the acceptance for the same, hence there emerges concluded implied contract between the employer and the employee. Both the remuneration received during the working hours and overtime constitutes a composite wage and thereby it is a wage within the meaning of Sec.2(22) of the ESI Act. Therefore, the contribution is payable on the overtime allowance. However, overtime allowances will be considered as wage for the purpose of charging the contribution only and will not be considered for the purpose of the coverage of the employee under the Scheme.

The same view was held by the Supreme Court in its judgment delivered on 6.11.96 in the case of Indian Drugs & Pharmaceuticals Ltd. Vs. ESIC, in Civil Appeal No.2777 of 1980.

 23     DRIVERS’ ALLOWANCE

               In some of the factories/establishments the officers employed as employees are being paid drivers’ allowance per month. This allowance is being paid to enable the officers to appoint a driver at their own level and such drivers employed are not being paid salary directly by the factories/establishments. Where such allowance is being paid to the employees and the drivers are not engaged by the employees, in such event the allowance paid as such will be considered as wage under Section 2(22) of the ESI Act and contribution will be chargeable provided the employee is coverable under the Scheme.. However, where the services of the drivers are being utilised, in such event the drivers so engaged will be covered as employee and contribution will be payable on the amount paid to the drivers as salary and booked in the ledgers of the employer under the heading ‘Drivers’ Allowance’

 24.        NIGHT SHIFT/HEAT/GAS & DUST ALLOWANCE:  

               It is an additional remuneration paid to the employee for performing duty at night time during the hours of darkness. This amount is paid by way of incentive under the scheme of settlement entered into between the Management and its workmen and hence are wages within the meaning of Sec.2(22) of the ESI Act. This view was observed by the Full Bench of Karnataka High Court in the case of NGEF Ltd. Vs. Dy.Regional Director, ESIC, Bangalore . Supreme Court in the case of M/s.Harihar Polyfibers Vs. RD ESIC, Bangalore has also held the same view. Hence, Night Shift Allowance, Heat, Gas & Dust allowance are wages under Sec.2(22) of the ESI Act and contribution is payable on the said amount paid by the employer to the employees.

 25.        INTERIM RELIEF:  

                Interim relief paid to the employees is normally paid when either the wage is under revision or when the payment of Dearness Allowance is delayed due to any reason. Whatsoever may be the case, if the interim relief is paid to the employees by any employer, the same will amount the wages within the meaning of Sec.2(22) of the ESI Act and contribution is payable thereon.  

 26.        HOUSE RENT ALLOWANCE

           House Rent Allowance is wage in cases where it is being paid. Notional amount of house rent can not be presumed as wages for deciding the coverage. In cases where an employee is being paid house rent allowance, the same will be included both for coverage and contribution. In cases where the staff quarters have been allotted the amount of salary and wages paid will count for coverage and contribution and no notional house rent allowance is to be presumed in such cases.

In the cases of Braithawait & Co. Vs. ESIC and M/s.Harihar Polyfibres Vs. ESIC, Bangalore , Supreme Court has also held that house rent allowance is a ‘wage’ under Sec.2(22) of the ESI Act.

 The following items will NOT form part of the wage either under 

                Section 2(9) or under Section 2(22) of the ESI Act:-

                        a.        Payment made on account of un-availed leave at the time of discharge.

b.       Commission on advertisement secured for Newspapers, if not paid to the regular employee.

c.        Fuel allowance/Petrol allowance

d.       Entertainment allowance       

Question:  A company incorporated in 2006  still not registered in ESI,know the company registered normal procedure way or belated period penalty any they charged?

I want to know the whole procedure to introduce a new company into esic asap. Please need your help for this.

my mail id is priyanshi.j @ dubble.org

For registration under ESI is it Online or Manual.? 

registration under ESI is it Online or Manual.? 

 

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