Configure ESI
ESI (Employee State Insurance) is a statutory deduction that applies to employees below a wage threshold. Configure it once and Kredily applies it automatically on every eligible payroll run.
Enabling ESI
- Open Payroll → Settings → PF & ESI and add an effective date for the configuration.
- Turn on ESI for your organization.
- Kredily applies ESI automatically to employees whose wages fall within the applicable statutory limit — you don't need to enable it employee by employee.
Employee eligibility
ESI eligibility is driven by wage thresholds set by statute. Employees above the threshold are automatically excluded from the deduction; if someone's wages change (a revision pushes them above or below the limit), Kredily reassesses eligibility from the next applicable run.
Employee ESI numbers
Each ESI-eligible employee needs their ESI number on record for compliance and filings. Add or update this in the employee's finance/statutory details — missing numbers can affect filings even if the deduction itself is computing correctly.
Common issues
- ESI not deducting for an eligible employee — check their wages actually fall within the applicable limit, and that an effective date was set when ESI was enabled.
- ESI deducting for someone who shouldn't be covered — check their current wage figures; a recent revision may not have been reflected in the run yet, requiring a recalculation.
- Missing ESI number — add it to the employee's statutory details; it's needed for filings independent of whether the deduction computes.
ESI rates and wage thresholds follow statutory rules. If you're unsure what applies to your organization, confirm with your finance team rather than guessing.
When to contact support
If ESI configuration and effective dates look correct but deductions still don't compute as expected on a run, raise a ticket with the employee ID and payroll month.
Related: Configure PF, ESI & Professional Tax, TDS and Form 16