ESIC Act, 1948- Wages Means
In this article we discuss about the items to be included in gross salary and items is not included in the gross salary for calculation of ESIC contribution. The following items to be considered for calculation of ESIC Gross salary: –
| S. No. | To be Included in Wages | S. No. | Not to be included in Wages |
|---|---|---|---|
| 1 | Basic Pay | 1 | Sum paid to defray special expenses |
| 2 | Dearness Allowance | 2 | Gratuity payable on discharge |
| 3 | House rent allowance | 3 | Pay in lieu of notice retrenchment |
| 4 | City compensatory allowance | 4 | Benefits paid under the ESI Scheme |
| 5 | 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 | 5 | Encashment of leave Encashment |
| 6 | Annual Bonus, Incentive Bonus, Production Bonus, Attendance Bonus provided the periodicity of the payment is not more than 2 months | 6 | Payment of Inam which does mean part of employment |
| 7 | Nightshift allowance | 7 | Washing allowance |
| 8 | Children education allowance | 8 | Conveyance amount towards reimbursement for duty related journey |
| 9 | Heat, Gas & Dust allowance | 9 | Annual Commission |
| 10 | Suspension Allowance/Subsistence Allowance paid to the suspended employee | 10 | Service charges are collected by management of the hotel on behalf of their employees in lieu of direct tips and the same is paid to their employees at a later date |
| 11 | Wages Paid During Layoff | 11 | Exgratia Payment During Strike for Travelling Expenses |
| 12 | Conveyance Allowance except reimbursement allowance | 12 | Saving Scheme for the welfare of the workers |
| 13 | Medical allowance in lieu of medical aid/reimbursement of medical expenses. Where such payments are made by the employer in lieu of the medical benefit. | ||
| 14 | Newspapers allowance instead of reimbursement of the cost of the Newspapers | ||
| 15 | Education allowance instead of reimbursement of the cost of the education | ||
| 16 | Drivers Allowance | ||
| 17 | Food/Milk/Tiffin/Lunch Allowance:- Paid in cash at fixed rate irrespective of whether the person is absent or on authorised leave etc | 13 | Food/Milk/Tiffin/Lunch Allowance:- a. Paid in cash with deduction for leave or absence etc. b. Paid in kind i.e. canteen subsidy/food subsidy etc. |
| 18 | Gazetted Allowance | ||
| 19 | Wages and Dearness Allowance for Unsubstituted Holidays | ||
| 20 | Interim Relief normally paid when either the wage is under revision or when the payment of Dearness Allowance is delayed due to any reason | ||