Help me calculate salary breakup manually if the salary is either Rs.15000 or Rs.19000 and should be provided PF ESI?

Hi, could you please help me calculate the salary breakup manually if the salary is either Rs. 15,000 or Rs. 19,000 and should include PF and ESI deductions? Please provide your valuable suggestions for calculating this manually.

Thank you.

Dear Sanjay,

1. As per statutory norms of the government, in a salary break-up - if the total gross earnings of an employee (after deducting washing allowances, if available) are less than Rs. 22,000/-, then he is eligible for ESIC deduction.

2. However, it also depends on which state the employee is working in, as ESIC differs between states. In certain states, ESIC is not deducted for widows. Please verify this.

3. PF should be deducted compulsorily if the staff's pay is less than or equal to Rs. 15,000. If it's above Rs. 15,000, it's not mandatory. However, with management consent, it could be deducted either as a flat Rs. 1,800/- every month or at 12% of the earned Basic+DA every month.

I will share an example shortly. Please have a look at it.

Thank you.

Dear Sanjay,

To calculate a breakup, it's necessary to provide the following details:

1. State of employment: We need to verify the minimum wages act for the skill category to determine the basic pay in that location if we are looking to hire an employee.
2. Category of employment (Skilled/Semi-Skilled/Under-Skilled).
3. Please confirm whether the pay you have specified, either 15000 or 19000, is Gross Pay, Net Pay, or CTC.
4. Nature of the industry: For example, in the Hospital Sector, washing allowances are excluded from Gross earnings when calculating ESIC. This distinction is essential for accurate calculations.

With these details, I can provide the breakup and explanation.

Thank you.