ESIC Registration – benefits, process and eligibility

Employee State Insurance Corporation is an autonomous body created under the ministry of labor and employment, the government of India. Employee State Insurance Corporation is a scheme created under the ESIC for self-financing social security and health insurance schemes for Indian workers. It is a scheme provided to help workers to compensate for wage loss due to sickness and incapacity to work. It provides full medical coverage to the employees registered under the ESI Act, of 1948. The medical claim extends to his/her family members as well.

Who is required to register under ESI

The registration is mandatory for all factories or establishments which have 10 or more permanent employees and whose wages are less than 21,000/- per month. It is said to be the responsibility of the employer to register the said establishment under Section 2A of the Act read with Regulation 10-B, within 15 days of the factory being eligible to be registered under the act. Failure on part of the employer in registration or non-compliance in filing the ESI returns will result in a penalty of 10,000/-

What is covered under establishment?

1. Shops

2. Hotels are not engaged in manufacturing activities. Only sales are allowed.

3. Cinemas including preview theaters

4. Road motor transport establishments

5. Newspaper establishments

6. Private educational institutions (run by individuals, trustees, societies, or other organizations.

Employer’s and employee’s contribution

Every month,

1. Employers are required to contribute 3.25% of wages payable,

2. Employees are required to contribute 0.75% of wages payable,

3. A total of 4% is deposited in the ESI every month

Compliance with ESI returns by the employer

Every entity or establishment registered under the ESI scheme need to file the ESI returns periodically

1. FORM 5- Half-yearly-

April to September- 11th November

October to march- 11th May

2. FORM 1a- Annually- 31st January

Documents necessary for ESI registration

1. Registration certificate- obtained under the factories act, shops and establishment act

2. Certificate of incorporation- COI in case of a company, partnership deep in case of partnership firms, GST certificate

3. Memorandum of association and articles of association of a company Address proof- utility bills (electricity bills, telephone bill, etc.), property tax receipts, rental agreement on which the establishment is situated.

4. List of employees working in the entity along with their PAN card details

5. PAN card of the business establishment

6. Compensation details of employees

7. List of directors of the company

8. List of shareholders of the company

9. A register containing details of attendance of employees

10. A canceled cheque for authentication purposes

How does the registration work?

1. The employer has to first get himself registered on the ESIC portal and sign in, to access the portal

2. After signing in, the employer will receive a confirmation mail on the registered email ID and mobile number registered at the time of signing up. It shall contain the username and password used at the time of signing as employer and employee

3. After the initial sign-up, log in to the portal, by entering the username and password received. This will be directed towards the page having a “new employer registration”.

4. Click on the drop-down and select if the particular entity is a “shop/establishment”

5. The “employer registration form-1” appears and the employer needs to fill in all the necessary details relating to units of the employer, employee details, details regarding the factory/establishment, etc.

6. After the submission of ESI registration form-1, the “payment of advance contribution” option will pop up, which the employer has to pay. The employer has to pay 6 months of contribution in advance

7. After the payment of 6 months advance contribution, a registration letter (C-11) is sent to the employer which will contain a 17-digit registration number by the ESIC department

Benefits of ESIC registration

1. Medical benefits to the employee and their family

2. Maternity leave and benefits for the pregnant working women

3. In case of the death of the employee, 90% of the salary is provided to the dependents of the deceased person every month.

4. Funeral expenses

5. Old age medical care expenses

6. Sickness benefits at the rate of 70% of salary, in case of illness which is certified and extends to a maximum of 91 days in any year.

FAQS

1. What are the other incentives for the ESI members?

The ESI members are entitled to unemployment cash benefits, maternity benefits, and allowance in case of female employees along with disablement expenses.

2. Do I need to be physically present for the process?

No, you need not be physically present for the process. Everything is online and digitized. All you need is an internet connection and a device to access the ESIC portal.