What is the ESI wage limit effective from Jan 1st 2017 ?

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ESI wage limit has been increased to Rs 21,000 from Rs 15,000 per month and will come into effect from 1st January 2017. Further, the board has given the option to the people who are already insured to continue their membership even if the salary is above the limit of Rs 21000 per month. According to the current provision, all those who are insured under the ESIC scheme have to forgo their ESI membership and the insurance cover if the salary/ wage increases over the limit. Post the implementation additional 50 lakh members will be covered under the ESIC scheme.

Currently, ESIC scheme offers insurance to 2.6 crore insured person and covers over 10 crore people, assuming 4 members of a family. Further, the announcement has been made that soon the plan to increase the wage threshold for retirement fund body EPFO subscribers  will be considered in the upcoming meeting of the Central Board of Trustees (CBT).

The formal ESI amendment circular by the Government of India is as follows:-

New Delhi, the 22nd December, 2016

G.S.R. 1166(E).—Whereas certain draft rules further to amend the Employees’ State Insurance (Central) Rules, 1950 were published in the Gazette of India, Extraordinary, Part-II, section 3, sub-section (i) vide number G.S.R. 957(E), dated the 6th October 2016 as required by subsection of section 95 of the Employee’s State Insurance Act 194(34 of 1948), inviting objections and suggestions from all persons likely to be affected thereby before the expiry of a period of thirty days from the date on which the copies of the Official Gazette in which the said notification was published were made available to the public;

And whereas, the copies of the said Official Gazette were made available to the public on the 6 October, 2016;

And whereas, objections and suggestions received from persons likely to be affected thereby have been considered by the Central Government;

Now, therefore, in exercise of the powers conferred by section 95 of the said Act, the Central Government, after consultation with the Employees’ State Insurance Corporation, hereby makes the following rules further to amend the Employees’ State Insurance (Central) Rules, 1950, namely:-

 1. a  These rules may be called the Employees’ State Insurance (Central) Third Amendment Rules, 2016.

b They shall come into force from 1 day of January, 2017.

2. In the Employees’ State Insurance (Central) Rules, 1950, in rule 50, for the words “fifteen thousand rupees” occurring at both the places, the words ‘twenty one thousand rupees” shall be substituted.

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