WorkLegal.in ← Back to Toolkit
Sponsored Resource

ESI Contribution Calculator

Compute 0.75% employee and 3.25% employer ESIC deductions under official wage thresholds.

₹
Includes Basic, DA, HRA, City Compensatory Allowance, and all monthly cash allowances.
Under Ministry of Labour rules, employees with disabilities receive an extended ₹25,000 threshold.
Used to verify the daily average wage exemption (₹176/day minimum).
ESI Statutory Schedule
ESI Act 1948
Covered: Gross Salary ≤ ₹21,000 Limit
Total Monthly ESI Contribution
₹720
Employee Share (0.75% Deduction) ₹135 / Month
Employer Share (3.25% Contribution) ₹585 / Month
Total Combined Rate 4.00% of Gross Pay
Annual Employee Deduction ₹1,620
Annual Employer Cost ₹7,020

How ESI Contributions are Calculated in India

Under the Employees' State Insurance Act 1948, ESI is mandatory for all non-seasonal factories and commercial establishments employing 10 or more persons where employee gross wages do not exceed statutory ceilings:

Employee Contribution = 0.75% × Gross Monthly Wages
Employer Contribution = 3.25% × Gross Monthly Wages
Total Contribution = 4.00% deposited with ESIC

The ₹21,000 Wage Ceiling Rule & Mid-Period Increments

If an employee's gross salary is ₹21,000 or below at the start of a contribution period (April–September or October–March), they remain covered until the end of that specific six-month contribution period even if their wages exceed ₹21,000 mid-way due to an increment or promotion.

Exemption for Daily Wage Earners

Employees whose average daily wage is up to ₹176 per day are exempted from paying the employee's share (0.75%). However, their employer must still contribute the full 3.25% share on their behalf.