Sat Apr 19 15:11:48 UTC 2025: ## Karnataka’s Minimum Wage Hike Creates ESI Eligibility Issue

**Bengaluru, April 19, 2025** – Karnataka’s recent revision of minimum wages, set to benefit over two crore workers, has inadvertently created a problem for a significant portion of them. The substantial increase, ranging from 5% to 70% depending on the sector and skill level, pushes many workers above the ₹21,000 monthly income ceiling for Employees’ State Insurance (ESI) benefits.

The new minimum wages, ranging from ₹19,319.36 to ₹34,225.42 per month depending on the job and location, were notified on April 10th. While welcomed by many, the increase means those earning above the ₹21,000 threshold (₹25,000 for the disabled) will lose access to ESI’s medical, sickness, maternity, and disability benefits.

State Labour Minister Santosh Lad acknowledged the issue, stating that the government has repeatedly urged the central government to raise the ESI eligibility ceiling to ₹30,000 per month. He highlighted that the minimum wage revision was based on scientific calculations considering the cost of living for a family of four, and that delaying the increase solely due to the central government’s inaction is unacceptable. He further clarified that while the number of workers affected immediately is relatively small, it significantly increases as minimum wages exceed ₹27,000.

Mr. Lad expressed hope that the central government will soon approve the requested increase, which would protect millions of workers from losing their ESI coverage. The revised minimum wage proposal is currently awaiting consideration by the Minimum Wages Advisory Board after the objection period.

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