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Monday 17 June 2019

Amendment in ESI Contribution for Employer and Employee

Effective 1st July, 2019 the Government of India along with the ESI Corporation has amended the rates of contribution for both employers and employees. Following a change made to rule 51 of the ESI Rules, employer and employee contribution has been reduced from 6.5% to 4%. Employers will now be required to contribute 3.25 percent(earlier rates were 4.75%), and employees rates are reduced from 1.75 to 0.75 percent.

The move is an attempt to increase the base of both employers and employees who contribute toward the fund. Officials anticipate a rise of about 20 percent in the contributions that are currently being received.