Employees’ State Insurance Update

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A quick line to let you know that the Ministry for Labour and Employment has issued a Notification bearing no. G.S.R 121 (E) dated February 15, 2019 (attached) notifying the draft rules which proposes to reduce the employee and employer contributions under the Employees State Insurance Act, 1948. The change proposed in the rate of contribution is as follows:

(a)      Employee’s contribution is to be reduced from 1.75% to 1%; and

(b)      Employer’s Contribution is to be reduced from 4.75% to 4%.

Persons likely to be affected by the amendment are invited to provide their objections/ suggestions to the Central Government. We are tracking this development closely and will keep you posted once the change is notified and in effect.

Date: February 20, 2019