ESI Contribution Calculator
How ESI contribution is calculated
The Employees' State Insurance (ESI) scheme gives medical and cash benefits to workers earning up to a wage ceiling. Both the employee and the employer contribute a percentage of the employee's gross monthly wages. The calculator above works out each side's share and the total.
Rates and ceiling
- Employee: 0.75% of gross wages.
- Employer: 3.25% of gross wages.
- Total: 4% of gross wages.
- Wage ceiling: ESI applies up to ₹21,000 gross per month (₹25,000 for employees with a disability).
A worked example
Gross wage ₹18,000: employee ₹135, employer ₹585, total ₹720 per month. The ₹135 is deducted from salary; the employer pays ₹585 on top and deposits ₹720 to ESIC.
What the employee gets
- Full medical care for the worker and family, with no cap on treatment cost.
- Sickness benefit (about 70% of wages, up to 91 days a year), maternity benefit, disablement and dependants' benefits.
Employer compliance
The employer deducts the employee's share, adds its own, and deposits the total by the 15th of the next month. Late payment attracts interest (12% p.a.) and damages. Contribution periods are April–September and October–March.
What counts as "gross wages" for ESI
ESI is calculated on gross wages — basic, DA, HRA, conveyance, and most allowances paid every wage period. It generally excludes annual bonus, gratuity, and reimbursement of actual expenses. Overtime is included for calculating the contribution but is not counted when deciding whether an employee crosses the ₹21,000 coverage ceiling. Getting this base right matters, because under-deducting exposes the employer to interest and damages on the shortfall.
The mid-period rule that trips up payroll
If an employee's wage rises above ₹21,000 in the middle of a contribution period, they do not exit ESI immediately. They continue contributing (and stay covered) until the end of that contribution period — April–September or October–March — and only then leave the scheme. This keeps benefit eligibility continuous and avoids mid-month confusion, but payroll teams must remember to keep deducting until the period closes.
Which establishments must register
ESI applies to non-seasonal factories and notified establishments — shops, hotels, cinemas, road transport, and others — generally employing 10 or more persons (20 in a few states), where employees earn within the wage ceiling. Registration is mandatory within 15 days of the Act applying, and every covered employee gets an ESI number and a Pehchan card to access the benefits. Even one missed monthly contribution can hold up an employee's medical or maternity claim, so timely filing protects both sides.
Frequently asked questions
What is the ESI contribution rate?
0.75% from the employee and 3.25% from the employer, totalling 4% of gross wages.
What is the ESI wage ceiling?
Gross wages up to ₹21,000 a month (₹25,000 for employees with a disability).
Is ESI on basic or gross salary?
On gross wages - basic, DA and most monthly allowances - not just basic.
Who pays more?
The employer, at 3.25% versus the employee's 0.75%.
What if salary crosses ₹21,000 mid-period?
The employee keeps contributing until the end of the current contribution period, then exits ESI.
Source: Employees' State Insurance Act, 1948, and ESIC rates (0.75% / 3.25%). Confirm current rates and ceiling on the ESIC portal. ComplyKraft is independent; this is not professional advice.