ESIC & EPF Employer Cost Calculator (India) — Statutory Contributions per Employee
What does an employee really cost with statutory contributions? Employer and employee EPF (12% + 12%, EPS 8.33% on the ₹15,000 ceiling, EDLI 0.5%, admin 0.5%), ESIC (3.25% + 0.75% when gross is up to ₹21,000), bonus under the Payment of Bonus Act, gratuity accrual and professional tax — per employee and for the whole payroll, with the wage-ceiling choice and the thresholds at which each law applies.
How it works
employer EPF = 12% × PF wage (basic + DA, or the ₹15,000 ceiling), of which EPS = 8.33% × min(wage, ₹15,000); EDLI 0.5% + admin 0.5% · employee EPF = 12% · ESI (gross ≤ ₹21,000): employer 3.25%, employee 0.75% · bonus = 8.33–20% × min(gross, ₹7,000 or minimum wage) for gross ≤ ₹21,000 · gratuity accrual = 4.81% × basic · cost = gross + employer contributions
Indian payroll law layers several employer contributions on top of gross salary, each with its own wage base and threshold: provident fund on basic pay up to a ceiling unless the employer volunteers more, with a slice diverted to the pension scheme and small insurance and administration charges; state insurance for lower-paid staff in covered establishments; a statutory annual bonus for those under the wage limit; and gratuity that accrues quietly from day one but is paid only after five years. Together they add roughly a sixth to a quarter to the wage bill, which is why the honest planning number for a hire is cost-to-company rather than the salary offered, and why the same rules subtract from what the employee takes home.
Worked example
Twenty-five employees on ₹18,000 gross with basic at 55% (₹9,900): employer PF is ₹1,188 (₹825 of it to EPS), EDLI and admin ₹99, ESI ₹585, minimum bonus ₹583 and gratuity accrual ₹476 — ₹2,931 a month, a 16% loading — so each employee costs ₹20,931 and takes home ₹16,477 after their own PF (₹1,188), ESI (₹135) and ₹200 professional tax. The payroll runs about ₹62.8 lakh a year against ₹54 lakh of gross salaries.
Frequently asked questions
Can we skip PF for employees earning above ₹15,000?
Only if they have never been a PF member (an "excluded employee" at first joining) and both sides agree in writing; once a member, always a member. In practice most employers cover everyone and contribute at least on the ceiling.
Does ESI stop the moment salary crosses ₹21,000?
No — cover continues to the end of the current contribution period (April–September or October–March), and contributions continue on the full salary until then. From the next period the employee exits ESI; provide group health insurance to replace it.
Related calculators
Indian tax and finance rules as of FY 2025-26 (AY 2026-27) — slabs, thresholds and state schedules change with each Budget and state notification. Figures are estimates for planning; confirm with the Income Tax portal, your employer's payroll, your bank or a chartered accountant before acting.