Time for payment of ESI contribution Amended to 15 Days from 21 days in Regulation 31

New Delhi, the 2016

No. N-12/13/1/2016-P&D—The following draft regulations further to amend the Employees’ State Insurance (General) Regulation, 1950 which the Employees’ State Insurance Corporation purposes to make in exercise of the powers conferred by Section 97 of the Employees’ Insurance Act,1948 (34 of 1948), is hereby published as required by Sub-Section (1) of the said Section for information of all persons likely to be affected thereby and notice is hereby given that the said draft regulations will be taken into consideration after expiry of a period of Thirty days from the date on which copies of the Official Gazette in which this notification is published, are made available to the public:-

1. Any objection or suggestion, which may be received from any person in respect of the said draft regulations within the period specified above, will be considered by the Employees' State Insurance Corporation.

2. The objections and suggestions, if any, may be addressed to Shri S. K. Garg, Insurance Commissioner-(P & D), Employees' State Insurance Corporation, Panchdeep Bhawan, C.I.G. Marg, New Delhi-110002 (e-mail.sk.garg@esic.in)

DRAFT REGULATIONS

In the Employees’ State Insurance (General) Regulations, 1950.

1. These Regulations may be called Employees' State Insurance (General) Amendment Regulations, 2017.

2. In Regulation 31, for the words within “21 days” wherever they Occur, the words within “15 days” shall be substituted.

S. K. GARG Insurance Commissioner (P&D)

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Thus new Regulation will be read as below...

Regulation31: Time for payment of contribution
An employer who is liable to pay contributions in respect of any employee shall pay those contributions within 15 days of the last day of the calendar month in which the contributions fall due:
Provided that where a factory/establishment is permanently closed, the employer shall pay contribution on the last days of its closure:

Provided that an employer may opt, in such manner as may be prescribed by to the Director-General, for payment of amount in advance towards contribution to be adjusted against contributions payable by him (including employees contribution) for a wage period so that the balance of advance amount continues to be more than the contributions due and payable at the end of the concerned wage period. Such employer shall furnish in the prescribed pro forma (Form 5-A), a six-monthly statement of contributions payable and paid in advance with the balance left at the end of each month along with return of contributions to the appropriate regional office of the Corporation.

Thinks to be noted before making payment

Sub-section (23) of Section 2 defines "wage period" in relation to an employee to mean "the period in respect of which wages are ordinarily payable to him whether in terms of the contract of employment, express or implied or otherwise".

Section 39 of the Act deals with contributions to be paid by the employer and the employee. Section 40 provides for payment of contribution by the principal employer in the first instance. Relevant provisions of the said sections read as under:

"Section 39 Contributions.- (1) The contribution payable under this Act in respect of an employee shall comprise contribution payable by the employer (hereinafter referred to as the employer's contribution) and distribution payable by the employee (hereinafter referred to as the employees' contribution) and shall be paid to the Corporation.

(2) The contributions shall be paid at such rates as may be prescribed by the Central Government:

Provided that the rates so prescribed shall not be more than the rates which were in force immediately before the commencement of the Employees' State Insurance (Amendment) Act, 1989.

(3) The wage period in relation to an employee shall be the unit in respect of which all contributions shall be payable under this Act.

(4) The contributions payable' in respect of each wage period shall ordinarily fall due on the last day of the wage period and where an employee is employed for part of the wage period, or is employed under two or more employers during the same wage period the contributions shall fall due on such days as may be specified in the regulations. (5) (a) If any contribution payable under this Act is not paid by the principal employer on the date on which such contribution has become due, he shall be liable to pay simple interest at the rate of twelve percent per annum or at such higher rate as may be specified in the regulations till the date of its actual payment:

Provided that higher interest specified in the regulations shall not exceed the lending rate of interest charged by any scheduled bank.

(b) Any interest recoverable under clause (a) may be recovered as an arrear of land revenue or under Section 45-C to Section 45-1.

Section 40. Principal employer to pay contribution in the first instance.-

(1) The principal employer shall pay in respect of every employee, whether directly employed by him or by or through an immediate employer, both the employer's contribution and the employee's contribution.

(2) Notwithstanding anything contained in any other enactment but subject to the provisions of this Act and the regulations, if any, made thereunder, the principal employer shall in the case of an employee directly employed by him (not being an exempted employee), be entitled to recover from the employee the employee's contribution by deduction from his wages and not otherwise: Provided that no such deduction shall be made from any wages other than such as relate to the period or part of the period in respect of which the contribution is payable, or in excess of the sum representing the employee's contribution for the period."