ESI is not calculated properly in salary for existing employees

Hi Gurus,

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.)


Pradeep Krishnamurthy



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

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