Employee State Insurance (ESI) provides health and social security for Indian workers. Use our free ESI Calculator India to compute contributions and check eligibility. Part of our Complete Salary & Tax Guide for India.
What Is ESI?
The Employees' State Insurance Corporation (ESIC) runs a social security scheme funded by employee and employer contributions. It covers medical care, sickness, maternity, disability, and dependent benefits.
ESI Eligibility
Gross wages ≤ ₹21,000/month (₹25,000 for disabled employees). Establishments with 10+ employees in manufacturing (20+ in other sectors) must register.
Contribution Rates
Employee: 0.75% of gross wages. Employer: 3.25%. Total: 4% of gross wages per month.
What Counts as Gross Wages?
Basic + DA + HRA + special allowances. Overtime and one-time bonuses may be excluded in some interpretations — state and employer practice varies.
ESI Benefits
Medical treatment (ESIC and empanelled hospitals), sickness benefit (70% wages, up to 91 days), maternity (100% wages, 26 weeks), disability benefit, dependent benefit, and funeral expenses.
ESI vs EPF
Both are mandatory deductions but serve different purposes. EPF is retirement savings (12% employee + 12% employer on basic up to ₹15,000). ESI is health and social security (0.75% + 3.25% on gross up to ₹21,000).
Salary Crosses ₹21,000 Mid-Year
ESI continues until the contribution period ends (April–Sep or Oct–Mar). From the next period, coverage stops if salary remains above the ceiling.
Related: EPF Calculator, Professional Tax Calculator, CTC Calculator, CTC to in-hand salary guide.
Frequently Asked Questions
What is the ESI contribution rate in India for 2026?
The ESI contribution rates for FY 2026-27 are 0.75% of gross wages by the employee and 3.25% by the employer, totaling 4%. These rates were reduced from 1.75% (employee) and 4.75% (employer) in 2019 and have remained unchanged since.
What is the ESI wage ceiling for FY 2026-27?
Employees earning gross wages up to ₹21,000 per month (₹25,000 for employees with disability) are covered under ESI. Employers of establishments with 10 or more employees in most sectors must register for ESI.
Is ESI deducted from Basic or Gross salary?
ESI is calculated on gross wages — which includes basic salary, dearness allowance (DA), HRA, and most monthly allowances. One-time payments like bonuses and overtime wages above a threshold may or may not be included depending on the ESIC guidelines applicable.
What happens to my ESI if my salary exceeds ₹21,000 mid-year?
If your salary crosses the ₹21,000 ceiling mid-contribution period (April-September or October-March), ESI contributions continue until the end of that contribution period. From the next contribution period onwards, you are no longer covered if your salary remains above the ceiling.