Have set the ESI eligibility limit as 15000 as delimit form 1-May-2010 but still when we derive the salary component of an employee more than 15000 still ESI is calculated from their gross salary.
As per the ESI eligibility limit if an employee salary cross more than 15000 it is should not calculate the contribution for ESI but here it is calculating for any amount.
Kindly suggest a best solution to get the sorted. Kindly share me the path to resolve this issue.
(Updated the limit as 15000 in the following path SPRO -> Payroll -> India Payroll -> Statutory Social Contribution - > Employee State Insurance -> Main Contribution rates for ESI. Updated the limit as 15000.)
Please check the cumulation classes 12(ESI Basis) and and 13 (ESI Basis Nominal) for all the wagetypes you are using in the entire payroll process.
You might have missed the select option button to untick on it for some wagetypes which you are using in payroll.
Please go to table v_512w_d to check the cumulation classes for the respective waghetypes.
Also u can see the RT table for the ESI Base Amount,by this u can know on what wagetypes the esi basis amount is calculated.
If any,please revert.
this is standard behavior. For employees, even if anyone exceeds the ESI limit within the ESI period, deduction will happen.
Please have a look at the documentation of function INESI
An employee was a beneficiary of the ESI scheme in 1998 as his ESI basis was Rs.6,200. When the salary of the employee was revised in February 1999, the ESI basis of the employee was Rs.6800. The employee was not eligible for the benefit of ESI because of the increment in salary, but continues to contribute to ESI until the contribution period lapses.
First you check , why the gross salary of the employee has increased. did you made any irregular payment to the employee in that period. And whether that irregular payment should be included in ESI basis calculation or not.
As per the statutory norms of ESI.
There are two ESI contribution period.
a) April 1 - September 30
b) October 1 - March 31
The function calculates the Nominal Pay for ESI eligibility check,
- If the payroll run is for the first month of the contribution
period, that is, April or October, or
- No ESI contributions have been made in any of the previous
periods of the current contribution period.
If the employee has contributed for ESI in any one month of the ESI
contribution period, then the employee will continue to contribute
for all the subsequent months in that contribution period.
Check the INESI function, it wil be more clear to you
Edited by: sandeep_1979 on Feb 17, 2011 12:07 PM