Wages - Bonus

ANNUAL BONUS:

Bonus paid to the employees could not be treated as wage for the purpose of charging of contribution under Sec.2(22), provided the periodicity of the payment is more than 2 months. The said issue was also considered in the meeting of the ESI Corporation held on 19.12.1968 and the Corporation agreed to the recommendations of the Standing Committee that bonus may not be treated as wage. Hence no contribution is payable on annual Bonus.
(Earlier instructions were issued vide memo No.Ins.III/2(2)-2/67 dt. 8.2.1967).

INCENTIVE BONUS:

As per the decision of the Supreme Court delivered on 8.3.2000 in the case of M/s.Whirlpool India Ltd. Vs. ESIC in civil appeal No.1903 of 2000, additional remuneration to become wages has to be paid at intervals not exceeding two months as distinguished from being payable. Thus, there has to be actual payment and the payment of production incentive does not fall either under the 1st part or last part of the definition of the term wages as defined in Sec.2(22) of the Act, hence no contribution is payable on the incentive bonus, provided the periodicity of payment is more than 2 months.
(Earlier instructions were issued by this office vide Memo No.T-11/13/53/19-84-Ins.IV dt. 19.9.84, Memo No.Ins.III-2(2)/2/69 dt,. 26.12.73, Memo No.T-11/13/54/18/82-Ins.IV dt. 14.7.82 & Memo No.D/Ins.5(5)/68 dt. 18.9.88.)

PRODUCTION BONUS:

Production Bonus like incentive bonus is paid to the workers as additional remuneration and hence like incentive bonus such additional remuneration in order to become wages has to be paid at intervals not exceeding 2 months as distinguished from being payable. Thus, there has to be actual payment and hence no contribution is payable, provided periodicity of the payment is more than 2 months.
(Earlier instructions issued vide letter dated 4(2)/13/74-Ins.IV dated 2.9.85)

ATTENDANCE BONUS

It is a special allowance being paid by certain employers to their employees to discourage the workers from absenting from the job. Any amount paid by the employer to its employees as Attendance Bonus will constitute wages under Sec.2(22) of the ESI Act and the same opinion was held by Bombay High court in the case of ESIC Vs. Indian Dyestuff Industries Ltd.. However, the periodicity aspect has to be kept in mind. In case the periodicity is more than 2 months, the same will not constitute wages and no contribution will be payable as in the case of incentive bonus.

PAYMENT MADE TO RICKSHAW PULLERS,HATHRAIRY PULLERS AND TRUCK OPERATORS (INCLUDING LOADING & UNLOADING CHARGES WHEN THE LOADERS/UNLOADERS ARE THE EMPLOYEES OF THE TRUCK OPERATORS:

Rickshaw pullers, Hathrairy pullers and Truck Operators (who bring labour with them) no contribution is payable on the amount paid by the employer if the amount paid is lumpsum amount including loading/un-loading charges and no separate wages are paid by the employer. Similar view was held by Bombay Division Bench in 1990 in the case of Raisaheb Tekchand, Mohate Mills Vs. R.D. ESIC.

Wages - ALLOWANCE II

HOUSE RENT ALLOWANCE(HRA)

House Rent Allowance is wage in cases where it is being paid. Notional amount of house rent can not be presumed as wages for deciding the coverage. In cases where an employee is being paid house rent allowance, the same will be included both for coverage and contribution. In cases where the staff quarters have been allotted the amount of salary and wages paid will count for coverage and contribution and no notional house rent allowance is to be presumed in such cases.

In the cases of Braithawait & Co. Vs. ESIC and M/s.Harihar Polyfibres Vs. ESIC, Bangalore, Supreme Court has also held that house rent allowance is a ‘wage’ under Sec.2(22) of the ESI Act.
(Earlier instructions were issued vide memo No.T-11/13/11/15-Ins.III dt. 28.9.75, No.Ins.III(2)/15/15/74-Ins.Desk.I dated Dec.,76, No.T-11/13/53/19-84/Ins.IV dt. 19.9.84 & No.D.Ins.II/11/3087/303 dated 1.3.1985).

MEDICAL ALLOWANCE

The employees working in factories/establishments are being provided medical services in kind by the employer but in certain factories/establishments instead of providing medical services in kind, the amount spent by the employees on medical care is reimbursed while in some other organisations, employees are being paid monthly cash allowance in lieu of medical aid/reimbursement of medical expenses. Where such payments are made by the employer in lieu of the medical benefit, the same are to be treated as wages under Sec.2(22) of the ESI Act and the contribution is chargeable.
(Earlier instruction were issued vide letter No.Ins.5(5)/68-Ins.III dt. 21.8.71 & Ins.III/2(2)2/68 dated 24.6.71)

NEWSPAPER ALLOWANCE

In certain factories/establishments the employees are reimbursed the cost of Newspapers while in some other factories/establishments the employees are paid monthly newspapers allowance instead of reimbursement of the cost of the Newspapers. Where the amount is being paid regularly to the employees by the employer as Newspapers allowance the same will be treated as wages under Sec.2(22) of the ESI Act and the contribution is chargeable. However, where the cost of Newspapers is reimbursed to the employees, no contribution is to be charged on such payments.

EDUCATION ALLOWANCE:

Employees are being paid monthly Education allowance for the children studying in the Schools/Colleges. Where such education allowance is being paid monthly, the same is to be considered as wages under Sec.2(22) of the ESI Act and the contribution is chargeable on the said amount.

However, in such cases where instead of paying the education allowance on monthly basis, the amount spent as fee is reimbursed to the employees and booked under education allowance, in such cases no contribution is payable.

DRIVERS’ ALLOWANCE

In some of the factories/establishments the officers employed as employees are being paid drivers’ allowance per month. This allowance is being paid to enable the officers to appoint a driver at their own level and such drivers employed are not being paid salary directly by the factories/establishments. Where such allowance is being paid to the employees and the drivers are not engaged by the employees, in such event the allowance paid as such will be considered as wage under Section 2(22) of the ESI Act and contribution will be chargeable provided the employee is coverable under the Scheme..

However, where the services of the drivers are being utilised, in such event the drivers so engaged will be covered as employee and contribution will be payable on the amount paid to the drivers as salary and booked in the ledgers of the employer under the heading ‘Drivers’ Allowance’.

FOOD/MILK/TIFFIN/LUNCH ALLOWANCE:

Each case of payment of Food, Milk, Tiffin and Lunch Allowance has to be examined on its merits depending on the following conditions under which the allowance is payable:-

Tiffin/Food/Milk/Lunch Allowance paid in cash at a fixed rate irrespective of whether the person is absent or on authorised leave etc. may be treated as wages.
Tiffin/Food/Milk/Lunch allowance paid in cash with deduction for leave or absence etc. may not be treated as wages.
Tiffin/Food/Milk/Lunch allowance paid in kind i.e. canteen subsidy/food subsidy etc. may not be treated as wages.
(Earlier instructions were issued vide letter No.P-11/13/97-Ins.IV dated 2.2.1999)
GAZETTED ALLOWANCE

Certain factories/establishments are paying gazetted allowance to its employees in lieu of duties performed by them on gazetted holidays. Such gazetted allowance is not wage for the purpose of Sec.2(9) of the ESI Act. However, it will be wage for the purpose of Sec.2(22) of the ESI Act and the contribution are to be recovered on such payments.

Wages - ALLOWANCE I

OVERTIME ALLOWANCE

In the case of the employer as and when the employer finds the need to have work done expeditiously, in addition to the normal work during the course of the working hours, the employer offers to the employee to do the overtime work after the working hours. When employee does overtime work it amounts to the acceptance for the same, hence there emerges concluded implied contract between the employer and the employee. Both the remuneration received during the working hours and overtime constitutes a composite wage and thereby it is a wage within the meaning of Sec.2(22) of the ESI Act. Therefore, the contribution is payable on the overtime allowance. However, overtime allowances will be considered as wage for the purpose of charging the contribution only and will not be considered for the purpose of the coverage of the employee under the Scheme.

The same view was held by the Supreme Court in its judgement delivered on 6.11.96 in the case of Indian Drugs & Pharmaceuticals Ltd. Vs. ESIC, in Civil Appeal No.2777 of 1980.
(Old instructions issued vide memo No.3-1(2)/3(1)/68 dt. 31.5.68).

NIGHT SHIFT/HEAT/GAS & DUST ALLOWANCE:

It is an additional remuneration paid to the employee for performing duty atnight time during the hours of darkness. This amount is paid by way of incentive under the scheme of settlement entered into between the Management and its workmen and hence are wages within the meaning of Sec.2(22) of the ESI Act. This view was observed by the Full Bench of Karnataka High Court in the case of NGEF Ltd. Vs. Dy.Regional Director, ESIC, Bangalore. Supreme Court in the case of M/s.Harihar Polyfibers Vs. RD ESIC, Bangalore has also held the same view. Hence, Night Shift Allowance, Heat, Gas & Dust allowance are wages under Sec.2(22) of the ESI Act and contribution is payable on the said amount paid by the employer to the employees.
(Earlier instructions were issued vide Memo No.T-11/13/53/19/84-Ins.IV dated 19.9.94).

CONVEYANCE ALLOWANCE

Conveyance allowance is paid to the employee to compensate the expenses incurred by the employees on travelling etc. The travelling allowance or value of any travelling concession is also being paid to the employees in the nature of conveyance allowance, which is neither wages for the purpose of coverage of employees under Sec.2(9), nor it is treated as wages for the payment of contribution under Section 2(22) of the ESI Act.

In the case M/s.Hyderabad Asbestos Cement Products Vs. ESIC, Punjab & Haryana High Court, Chandigarh as well in the case of M/s.Harihar Polyfibres, the Supreme Court have held that conveyance allowance is not wage under Section 2(22) of the ESI Act.
(Earlier instructions were issued by this office vide No.P.11/13/97-Ins.IV dated 27.1.97.)

SERVICE CHARGES

Service charges are collected by management of the hotel on behalf of their employees in lieu of direct tips and the same is paid to their employees at a later date.

Such amount collected as ‘service charges’ will not constitute wages under Sec.2(22) of the ESI Act. In the case of ESIC Vs. M/s.Rambagh Palace Hotel, Jaipur, the High Court of Jaipur has held that ‘service charges’ are not wages under Section 2(22) of the ESI Act. This verdict of the High Court of Jaipur was accepted in the ESIC and hence no contribution is payable on ‘service charges.
(Earlier instructions were issued vide letter No.P-12/11/4/79-Ins.Desk.I dt. 18.9.79)

WAGES AND DEARNESS ALLOWANCE FOR UNSUBSTITUTED HOLIDAYS:

Such wages and dearness allowance paid to the employees for the unsubstituted holidays are to be treated as wages under Sec.2(22) of the Esi Act and the contribution is payable. High Court of Gujarat in the case of ESIC Vs. New Assarw Manufacturing Co.Ltd. held the same view.

Contact Us

Sub-Regional Office (Tirunelveli)
Employees State Insurance Corporation (ESIC)
Municipal shopping complex
Salai street
Sindupoonthurai
Tirunelveli - 627 001
Tamil Nadu
INDIA

Ph: 0462 - 2332103, 2332106, 2332105,
EPABX: 2330136
FAX: 0462 - 2332107


email: esicsrotli@dataone.inThis e-mail address is being protected from spambots. You need JavaScript enabled to view it

Website URL:
SRO site: www.esictirunelveli.org
Headquarters Office site: www.esicindia.org
Toll Free Helpline: 1800 11 2526
No Name Designation Contact No
01. Sri. S. Ravichandran Joint Director 0462-2332105
02. Sri R. Thinesh Kumar Deputy Director (Finance) 0462-2332103
03. Sri. S.Pysone Gnanaraj Assistant Director 0462-2332106
04. Sri S. Murugesan Branch Manager, Tirunelveli 0462-2334333
05. Sri. M.Lakshmanan Branch Manager, Tuticorin 0461-2323133
06. SSri T. Thiagarajan Branch Manager, Nagercoil 04652-231115
07. Smt. B. Annammal Branch Manager, Kovilpatti 04632-220853
08. Sri A.Shanmugavel Branch Manager Vickramasingapuram 04634-220382
09. Sri. P.Chandran Branch Manager, Tenkasi 04633-228010
10. Sri. S.Rajagopal Branch Manager Marthandam 04651-264502
11. Sri. P. Sathiyavasagam Insurance Inspector, Tirunelveli 0462-2332106
12. Smt. G.V.Usharani Insurance Inspector, Tuticorin 0461-2323133
13. Sri. M.A.Ivin Insurance Inspector, Nagerkoil 04652-231115
14 Sri D. Muthuramalingam Insurance Inspector, Legal Mobile no.  9487248161
15 Sri R.  Muthu Velu Insurance Inspector, Recovery Mobile No.  9894177900
16 Sri S. Sam Christhu Kumar Office Superintendent Mobile No.  9442107787

Tags

ESIC, ESI, ESI Hospitals, Employer, Insurance, Employee, Industries, Tirunelveli, kanyakumari, ESI corporation, Medical, Disablement Benefits, INAM, Hospitals, Dispensaries,

Regional Board - Members' List

Sl No Name of the Representatives Designation Under Regulation
1 Minister of Labour, Government of Tamil Nadu Chairman 10 (1) (a)
2 Minister of Health and Family Welfare,
Government of Tamil Nadu
Vice-Chairman 10 (1) (b)
3 Secretary
Health & Family Welfare, Government of Tamil Nadu
Member 10 (1) (c)
4 Director,
Medical and Rural Health Service (ESI),   
Chennai 600006
Member 10 (1) (d) (i)
5 Secretary (Labour & Employment),
Government of Tamil Nadu, Chennai 600009
Member 10 (1) (d) (ii)
6 State Medical Commissioner
(ESI Corporation),      Chennai 600034
Ex-Officio Member 10 (1) (f)
7 Thiru.S.Sridharan,
Trichy District Tiny Small Scale Industries Association, Tamil Nadu, 58-59, Raja Colony, Collector Office Road, Trichy 620001
Employers' Representative 10 (1) (e)
8 Thiru M.Ravi,
Tamil Nadu Hotel Owners Association (TN, Vasantha Bhavan, 20, Gandhi Road, Egmore, Chennai 600008
Employers' Additional  Representative Provisio to Regulation  10 (1)
9 Thiru.T.M.Jawaharlal,
Employers' Federation of Southern India, Karumuthu Centre, 634, Anna Salai, Chennai 600035
Employers' Additional  Representative Provisio to Regulation  10 (1)
10 Thiru.P.Muthuvelappan, Senior General Manager,
Sakthi Sugars Ltd., Southern Indian Sugar Mills Association, 180, Race Course Road,
Coimbatore 641018
Employers' Additional  Representative Provisio to Regulation  10 (1)
11 Thiru M.Shanmugam,
Thozhilalar Munnetra Sanga Peravai, Pattavarthi, Pulla Poothangudi Post, Pabanasam Vattam, Thanjavur
Employees' Representative Regulation  10 (1) (e)
12 Thiru R.Audikesavan,
Tamil Nadu INTUC, 85-A/27, Mettu Street, Athipet, Ambattur, Chennai 600058
Employees' Additional  Representative Provision to Regulation  10 (1)
13 Thiru R.S.Rajendran,
State Secretary (CITU), 44, Kavaadakhara Street, Dindigul
Employees' Additional  Representative Provision to Regulation  10 (1)
14 Thiru S.Kasiviswanathan,
Tamil Nadu-AITUC, 33, Salai Street, Sindhupoonthurai, Tirunelveli
Employees' Additional  Representative Provision to Regulation  10 (1)
15 Regional Director,
ESI Corporation, Tamil Nadu
Member Secretary 10 (3)

Hospitals

No Address
01. Appollo Hospitals Enterprises Limited, Chennai-6
02. Miot Hospitals, Chennai-600 089
03. Prcms Eye Clinics, Chennai-600 015
04. Sugam Hospitals, Chennai-19
05. Mahathma Eye Hospitals, Tiruchirapalli- 620018
06. The Eye Foundation, Coimbatore-641002
07. A.G.Eyc Hospitals, Tiruchirappli-620 017
08. Laiiiha Hospitals, Coimbatore-12
09. Kongunadu Hospital (P) Limited, Coimbatore- 641012
10. Shecla Clinic, Coimbatore-641 012
11. K.G.Hospitals, Coimbatore-641 018
12. Harvey Heart Hospitala Ltd., Nungambakkam, Chennai
13. The Institute of Orthopedic Research and Accident Surgcry(ICRAS), Madurai-625 020
14. Jejan Singh Eye Hospitals, Nagercoil-629 003
15. JprJ-Maituas Hospital, Nagercoil
16. Sooriya Hospital, Chennai-93
17. Shanmuga Hospital and Salem Cancer Institute, Salem-638 007
18.
Kavcry Medical Center, Trichy-620 017
19. Meenakshi Mission Hospital and Research Centre, Madurai-625 107
20. Joseph Eye Hospital, Tiruchirappalii-620 001
21. PSG Hospitals, Coimbatore-64l64
22. Kovai Mcrlical Centre and Hospital, Coimbatore-641 014
23. Madras Medionl Mission, Chennai-600 037
24. Kidney care centre, Tirunelveli - 1
25. Quality Care Hospital Pvt Ltd, Madurai-625010
26. M.N.Byc Hospital, Chennai-21
27. Maruthi Hospital Trichy-620 017
28. Sri Ramaehandra Hospitals, Chennai-600 116
29. Apollo Speciality Hospitals, Madurai-625 020
30 Sri Ramakrishna Hospital, Coimbatore-641 044
31. Mani Hospital Pvt Ltd., Theni-675 531
32. Ashwin Poloyclinic P.Ltd., Coimbatore-641 012
33. Vijayfv Heart Foundation, Chennai-600 026
34. Malar Hospitals ltd., Chennai-600 020
35. KTVGGi ip Hospitals, Coimbatore-641 011
36. TMS Eye Hospital Salem-636 007
37. Santera Ncthralaya, Chennai-600 006
38. City Hospitals, Dindigul-624 005
39. Priya Hospital, Palani-624 601
40. Shifa Hospitals, Tirunelveli
41. Madurai Kidney Centre And Transplantation Research Centre, Madurai - 625 020.
42. Sree Abu-ami Hospital(P) Ltd, Coimbatore -: 625 020.

Wages

EXGRATIA PAYMENT DURING STRIKE FOR TRAVELLING EXPENSES

Like conveyance allowance if any exgratia payment is made during the period of strike to some of the employees to incur certain travelling expenses such amount will neither be considered as wage under Sec.2(9) nor under Sec.2(22) of the ESI Act and no contribution is payable on such amount. High Court of Bombay in the case of ESIC Vs. Willman (India) (P) Ltd. in case No.210 of 1976, held the same view.

INTERIM RELIEF:

Interim relief paid to the employees is normally paid when either the wage is under revision or when the payment of Dearness Allowance is delayed due to any reason. Whatsoever may be the case, if the interim relief is paid to the employees by any employer, the same will amount the wages within the meaning of Sec.2(22) of the ESI Act and contribution is payable thereon.

SAVING SCHEME

Certain factories/establishments are contributing towards the saving scheme for the welfare of the workers. Such amount paid by the employer as his contribution to the saving scheme, will not constitute wages under Sec.2(22) of the ESI Act and the contribution is not payable.
(Earlier instructions were issued vide Memo No.P-12/11/4/77-Ins.IV dt. 15.11.80)

HAMALS/COOLIES EMPLOYED AT A PARTIULAR TIME

Where Hamals & Coolies are employed at a particular place and a particular time, outside the premises of the factory/establishment to perform a specific job on the spot in such cases no contribution is payable on the amount paid to such Coolies/Hamals, however the contribution is payable on the amount paid to the coolies and hamals for services rendered within the premises of the employer.

Bombay High Court in the case of Parley Bottling Co.Ltd. VS. ESIC,Bombay

1989 and Supreme Court in the case of ESIC VS.Premier Clay Products, have held this view.

SHORT PERIOD CONTRACT FOR SERVICE – ELECTRICIAN, CARPENTERS, MECHANICS, PLUMBERS ETC./REPAIR WORK DONE ON SHOP

In such cases also contribution is payable on the amount paid by the Employer if the services are rendered within the premises. This view was also held by Punjab and Haryana High Court vide its judgement dated 29.3.84 in the case of Modern Equipment Vs. ESIC in Civil Appeal No.3218 of 1989.

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