Last Updated: March 2026 Reviewed by CA & CS Team · Patron Accounting LLP

ESI Calculator — ESIC Contribution & Eligibility 2026

TL;DR

This ESI Calculator computes your monthly Employee State Insurance contributions — employee pays 0.75% and employer pays 3.25% of gross wages (total 4%). Applicable only if gross wages are ₹21,000/month or below (₹25,000 for disabled persons). Enter your gross salary to instantly see the split, check eligibility, and get the half-yearly and annual totals. Also shows employer CTC impact and the 6 ESIC benefits you're entitled to.

Calculate ESI Contribution

Gross Monthly Wages (₹)

Basic + DA + HRA + CCA + applicable allowances

Number of Employees (for employer cost)

Total ESI-eligible employees

Person with Disability?

How Employee State Insurance Works

The Employee State Insurance (ESI) scheme is a self-financing social security programme under the ESI Act, 1948. It provides medical care and cash benefits to employees and their families during sickness, maternity, disability, and death due to employment injury. The scheme is managed by ESIC under the Ministry of Labour & Employment.

ESI Contribution Rates (w.e.f. 01.07.2019)

Employee Contribution: 0.75% of gross wages
Employer Contribution: 3.25% of gross wages
Total: 4.00% of gross wages

Wage Ceiling: ₹21,000/month (₹25,000 for PwD)
Applicability: 10+ employees (20+ in some states)
Low Wage Exemption: Daily avg wage ≤ ₹176 → employee exempt, employer still pays

Contribution Periods & Benefit Periods

ESIC divides the year into two six-month contribution periods, each linked to a benefit period:

Contribution Period	Benefit Period
April – September	January – June (next year)
October – March	July – December (same year)

If an employee's wages cross ₹21,000 during a contribution period, ESI deduction continues till the end of that period on the actual (higher) wages. The employee remains eligible for benefits during the corresponding benefit period.

CA Tip: The contribution period linkage is critical for employees who get mid-year salary hikes. If wages cross ₹21,000 in July, ESI continues through September (end of Apr-Sep period). But if wages were already above ₹21,000 when the employee joined in July, ESI never applies. Verify the joining date and initial salary carefully. Check the ESIC portal for current implementation areas.

What Counts as Wages for ESI?

Not all salary components are included in the ESI wage calculation. The ESI Act defines wages specifically:

Included in ESI Wages

Basic salary, dearness allowance (DA), city compensatory allowance (CCA), house rent allowance (HRA), incentive allowance, attendance bonus, meal/tiffin/food allowance, suspension allowance, lay-off compensation, children education allowance, and any other regular monthly payment that is part of the employment terms.

Excluded from ESI Wages

Annual bonus, retrenchment compensation, encashment of leave, gratuity, overtime wages, conveyance allowance paid exclusively for duty performance, washing allowance, employer PF contribution, ESIC contribution, and any ad-hoc or irregular payments. Understanding this distinction is essential — including wrong components inflates contributions, excluding valid ones risks non-compliance during ESIC inspections.

Important: If your establishment provides food allowance through a canteen or as a reimbursement (not cash), it may be excluded from ESI wages. However, if it is paid as a fixed monthly cash allowance, it is included. The treatment depends on the nature of payment, not the label. When in doubt, include it — under-reporting wages attracts penalties and back-contributions with 12% interest during ESIC audits.

ESIC Benefits for Employees

The ESI scheme provides six categories of benefits, making it one of the most comprehensive social security programmes for Indian workers:

Sickness Benefit

70%

of wages for up to 91 days/year during certified illness

Maternity Benefit

100%

of wages for 26 weeks (full pay during maternity leave)

Temporary Disability

90%

of wages during recovery from employment injury

Permanent Disability

90%

of wages proportionate to disability % (lifelong)

Dependant Benefit

90%

of wages to family on death due to employment injury

Funeral Expenses

₹15,000

lump sum towards funeral expenses on death

Additionally, ESIC provides free medical treatment at ESIC hospitals and dispensaries for the insured person and their family members. The ESIC network includes 159 hospitals, 42 annexes, and 1,500+ dispensaries across India. Employees can also access treatment at empanelled private hospitals through the ESIC tie-up hospital network.

ESIC Compliance for Employers

Registration

Employers must register on the ESIC portal within 15 days of the Act becoming applicable (10+ employees with at least one earning ≤₹21,000). File Form 1 with establishment details, PAN, address proof, and employee list. ESIC issues a 17-digit unique code number. Each employee receives an ESI card (Pehchan card) for availing benefits.

Monthly Payment

Employers must deduct the employee contribution (0.75%) from wages, add the employer contribution (3.25%), and deposit the combined amount within 15 days of the month-end via the ESIC portal. Payment through SBI and other authorised banks is also accepted. Late payment attracts 12% simple interest per annum.

Return Filing

Half-yearly returns must be filed: by 12th November for the April-September period and by 12th May for the October-March period. The return includes wages paid, contributions made, and employee details for the period. Non-filing attracts penalties under Section 85 of the ESI Act.

Need ESIC Compliance Help? Patron Accounting handles ESIC registration, monthly challan computation and payment, half-yearly return filing, employee onboarding, and ESIC inspection support for businesses across India. Get ESIC compliance help →

Frequently Asked Questions About ESI

ESI is a social security scheme under the ESI Act 1948 managed by ESIC. It applies to establishments with 10+ employees (20+ in some states). All employees earning gross wages up to ₹21,000/month are covered (₹25,000 for disabled persons). Once covered in a contribution period, coverage continues even if wages cross the ceiling mid-period.

Since July 2019: employee contributes 0.75% and employer contributes 3.25% of gross wages, totalling 4%. Employees earning daily average ≤₹176 are exempt from the 0.75% but the employer must still pay 3.25%. These rates apply uniformly across all ESI-implemented states and areas.

₹21,000/month for regular employees, ₹25,000 for persons with disability. Wages include basic, DA, HRA, CCA, incentive allowance, meal allowance. Excluded: overtime, conveyance for duty, annual bonus, gratuity, employer PF, and irregular payments. ESI is calculated on the full gross wages (included components), not just basic salary.

ESI is calculated on gross wages (included components). Employee: 0.75% of gross wages. Employer: 3.25% of gross wages. Example on ₹18,000 wages: employee pays ₹135, employer pays ₹585, total ₹720/month. Contributions are rounded to the nearest rupee. The employer deducts the employee share from salary and deposits both shares with ESIC.

Two contribution periods: April-September and October-March. Corresponding benefit periods: January-June (next year) and July-December (same year). If wages cross ₹21,000 during a contribution period, deductions continue till the period ends on actual wages. The employee remains covered for benefits during the corresponding benefit period.

Six benefits: sickness (70% wages, up to 91 days/year), maternity (100% wages, 26 weeks), temporary disablement (90% wages during injury recovery), permanent disablement (90% proportionate to disability), dependant benefit (90% to family on death from employment injury), and funeral expenses (₹15,000 lump sum). Plus free medical care at ESIC hospitals for employee and family.

Included: basic, DA, CCA, HRA, incentive allowance, attendance bonus, meal allowance, suspension allowance. Excluded: annual bonus, gratuity, retrenchment compensation, leave encashment, overtime, conveyance for duty, washing allowance, employer PF. The distinction depends on nature of payment, not the label — cash food allowance is included, canteen facility is excluded.

Late payment attracts 12% simple interest per annum from due date until payment. The employer is liable for both shares. ESIC can initiate recovery proceedings, impose penalties, and prosecute under Section 85. Payment must be within 15 days of month-end. During ESIC inspections, under-reporting wages or delayed payments are the most common findings.

If an employee earns above ₹21,000 from joining date, ESI does not apply. But if wages cross ₹21,000 during a contribution period (mid-year hike), ESI continues till the period ends on actual wages. After the period ends, if wages are still above the ceiling, ESI stops from the next contribution period. The employee retains benefit eligibility for the corresponding benefit period.

Register online at esic.gov.in by filing Form 1 with establishment details, PAN, address proof, registration certificate, and employee list. ESIC issues a 17-digit code number. Register within 15 days of applicability. Each employee gets an ESI card (Pehchan card) with their insurance number for availing medical and cash benefits at ESIC facilities.

Yes — ESI provides basic coverage through ESIC hospitals and dispensaries. Private medical insurance covers private hospitals, higher room categories, and wider network. Many employers offer group health insurance alongside ESI. They serve different purposes — ESI is statutory social security while private insurance is a voluntary employee benefit. Both can be claimed simultaneously for different treatments.

Check via ESIC portal with your insurance number, through the UMANG app (search ESIC → Claim Status), or visit the nearest ESIC branch. Your employer provides the insurance number at registration. Contribution details update monthly after employer files the challan. Download your e-Pehchan card from the ESIC portal for a digital copy of your ESI card.

Yes — a CA handles ESIC registration, monthly contribution calculation, challan payment, half-yearly return filing, and ESIC inspection support. Patron Accounting provides complete payroll including ESI, EPF, Professional Tax, and TDS for businesses across India. We also assist with ESIC dispute resolution and benefit claims for employees.