Introduce of ESI

ESI stands for Employee State Insurance managed by the Employee State Insurance Corporation of India to offer medical, sickness benefit, maternity benefit, disablement benefit, monetary and other advantages to workers. This scheme is started for Indian workers. The workers are provided with a huge variety of medical, monetary and other benefits from the employer. Any Company having more than 10 employees (in some states it is 20 employees) who have a maximum salary of Rs. 15000/- has to mandatorily register itself with the ESIC.

Benefits of ESI Registration for Employee

The benefits of registering under this scheme are varied. Some of them are

Sickness benefits

Sickness benefit in the form of cash compensation at the rate of 70% of wages is payable to insured workers during the periods of certified sickness for a maximum of 91 days in a year.

Disablement benefits

Disabled employees can get 90% of their monthly salaries as disablement benefits.

Medical aid

Medical Benefits to an employee and his family members. There is no ceiling on expenditure on the treatment of an Insured Person or his family member.

Dependant Benefit

Dependant benefit is paid at the rate of 90% of wage in the form of monthly payment to the dependants of a deceased insured person, in cases death occurs due to employment injury or occupational hazards

Funeral Expenses

The family of the deceased employee is entitled to an additional amount of Rs.10,000 towards funeral expenses.

Eligibility Covered Under ESIC Registration in India

As per the ESI Act of 1948, The entities covered are: 1. Shops 2. Restaurants or Hotels only engaged in sales. 3. Cinemas 4. Road Motor Transport Establishments; 5. Newspaper establishments (which is not covered under the factory act) 6. Private Educational Institutions 7. Medical institutions

Documents Required for ESI Registration

• Registration Certificate or License issued under Shops and Establishment Acts or Factories Act. • Address Proof: Latest Rent receipt of the premises you are occupying indicating the capacity in which the premises are occupied, if applicable. • Latest building Tax/Property Tax receipt (Photocopy). • Memorandum and Articles of Association/Partnership Deed/Trust Deed depending on the entity that is applying for registration. • Photocopy of certificate of Commencement of production and/or Registration No. of CST/ST (or GST once it becomes applicable). • Copy of PAN Card • Evidence in support of the date of commencement of production/business/first sale (e.g. Copy of First Invoice). • Month wise employment position, salary etc. • Copy of bank statement • List of Directors of the Company • List of the Shareholders of the Company • Register containing the attendance of the employees

What are the Process for Filing Returns after ESI Registrations are Finalised

  • ESI returns are to be mandatorily filed bi-annually along with the following documents:
  • Register of attendance of employees
  • Register of wages
  • Form-6 register
  • Monthly returns and respective challans
  • Registration of any accidents taken place within the industrial or business premises.

FAQ’s On ESI

What is the Procedure for registration of an employer?

An employer shall apply for FORM 01 within 15 days after the act becomes applicable to a unit or establishment.

What is the insurance number?

To recognize each employee, the ESI scheme allots a unique identification number to every worker. This number is called the insurance number and is used for all operational purposes.

Is over time to be included for wage ceiling limit for coverage of an employee?

No. Overtime is not included for calculating the wage ceiling limit for coverage of an employee. But, it is included for payment of contribution to cover the risk during the period of overtime work, and to enable receiving cash benefits at an enhanced rate also.

Is there any interest on delayed payment?

An employer who doesn’t pay the contribution within the time limit, will be liable to pay simple interest at the rate of 12% per annum for each day of default or delay in payment of contribution.

5. What is registration of an employee?

Registration is the process of recording information about the entry of an employee into insured employment, under the Act.

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