What is the ESIC salary limit in 2026?

₹21,000 gross a month, or ₹25,000 for persons with disability. It has been unchanged since 2017; a higher limit has been discussed but not notified as of October 2026.

My salary went above ₹21,000. Do ESI deductions stop at once?

No. You stay covered, and contributions continue, until the end of the current contribution period (30 September or 31 March). Coverage is checked again at the start of the next period.

Is ESI deducted from people on very low wages?

Employees whose average daily wage is ₹176 or less do not pay the employee share. The employer still pays its 3.25%.

Does ESI cover my family?

Yes. Medical benefit covers the insured person and dependent family members from the first day of insurable employment.

ESIC explained: who is covered and what you get

Updated 11 October 2026

ESI (Employees' State Insurance) is a social security scheme run by the Employees' State Insurance Corporation (ESIC) that gives medical care and cash benefits to lower-paid employees and their families. If your gross wages are ₹21,000 a month or less (₹25,000 for persons with disability), 0.75% of your wages is deducted and your employer pays 3.25%. The ESI ceiling did not change when the EPF ceiling rose to ₹25,000 in September 2026.

Who is covered

ESI applies to factories and establishments with 10 or more employees in areas where the scheme is in force. Employees whose gross monthly wages are within the ceiling must be registered from their first day, and each gets an insurance number (IP number). Coverage is tested at the start of each contribution period, on 1 April and 1 October, or when you join. If your pay rises above ₹21,000 during a period, you stay covered, and contributions continue, until that period ends.

Since 21 November 2025, ESI has been governed by the Code on Social Security, 2020, with central rules in force from May 2026. A higher ceiling, with ₹30,000 among the figures discussed, was considered at a meeting chaired by the Labour Minister in August 2026, but nothing had been notified by October 2026.

How much is deducted

Gross monthly wages	Employee (0.75%)	Employer (3.25%)	Total (4%)
₹12,000	₹90	₹390	₹480
₹16,000	₹120	₹520	₹640
₹20,000	₹150	₹650	₹800

Employees whose average daily wage is ₹176 or less pay nothing, though the employer still pays its 3.25%. Overtime is left out when checking whether you are within the ceiling, but contributions are charged on it. Employers must deposit the contributions by the 15th of the following month.

Contribution and benefit periods

ESI runs on two six-month cycles. Contributions for April to September count for cash benefits from January to June of the next year, and contributions for October to March count for July to December. That is why a new employee gets medical care straight away but has to wait about nine months before sickness benefit can be paid.

What you get

Benefit	What it pays	Main condition
Medical	Full medical care for you and your family, with no cost ceiling	From the first day of insurable employment
Sickness	70% of average daily wages for up to 91 days in two consecutive benefit periods	Contributions for 78 days in the contribution period; first two days of a spell unpaid
Extended sickness	80% of wages for up to two years, for 34 long-term diseases	Contribution conditions apply
Maternity	Full wages for 26 weeks, extendable by a month on medical advice	Contributions for 70 days in the two preceding contribution periods
Disablement	90% of wages, temporary or permanent	Employment injury, from the first day
Dependants	90% of wages, shared among dependants	Death from employment injury
Funeral expenses	₹15,000	From the first day
Unemployment	50% of wages: up to 90 days once in life (ABVKY, extended to June 2027), or up to two years after closure or retrenchment (RGSKY)	Minimum insured service and contributions

Worked example. Sunil earns ₹18,000 a month. His ESI deduction is 0.75%, or ₹135, and his employer pays 3.25%, or ₹585, a total of ₹720 a month. Over a year Sunil pays ₹135 × 12 = ₹1,620. Suppose he is ill for 10 days and his average daily wage works out to ₹600. Sickness benefit is 70% of that, ₹420 a day, but the first two days of a spell are not paid, so he receives ₹420 × 8 = ₹3,360, on top of free treatment at an ESI dispensary or hospital.

How to use ESI

Get your IP number from your employer and download your e-Pehchan card from the ESIC portal.
Add your family members so that they can be treated too.
Use your allotted ESI dispensary for routine care; it refers you to ESI or tie-up hospitals when needed.
Claim cash benefits through your ESIC branch office, and check that your contributions show up on the portal.

ESI and company health insurance

If you are covered by ESI, it is your primary health cover and costs you far less than a private policy. Once your wages cross the ceiling, ESI stops at the end of the contribution period, and most employers then offer group health insurance instead. For how ESI and PF appear on your payslip, see salary slip components and EPF explained; for the wider changes, read Labour Codes and your salary. Official details are on the ESIC website.