ESIC Registration

Employee State Insurance Corporation (ESIC)

The Employees’ State Insurance Act, 1948 was enacted by the legislature as an integrated need based on the social insurance scheme. ESIC stands for Employee State Insurance Corporation is an autonomous body created by the Ministry of Labour and Employment that governs and regulates the Employee State Insurance in India. Employee State Insurance is a self-financing social security scheme initiated for the benefits of the Indian workers by providing them with the necessary benefits such as medical facility, monetary facilities and such other benefits from his employer. ESI is managed and governed by the rules and provisions issued by the ESIC Act 1948.

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.

The ESIC Act also provides reasonably good medical care to the workers and their immediate dependents. Online ESIC registration is compulsory for entities employing, employees earning Rs. 21,000 (including DA) per month or less as wages or salary.

Mandatory Contribution

The scheme of ESI is contributory in nature. Both employee’s and employer’s contribution is required at a specific rate. Though, rates are amended from time to time. The employer needs to contribute 4.75 %, and the employee needs to add 1.75% a total share of 6.5% of the Gross salary under the ESIC Act. This fund is supervised by the ESI Corporation incorporated under the ESI Act. The entity owner has to mandatory register under ESI Scheme within 15 days from the date of incorporation. Employees who earn upto Rs137 of daily average wage are not entitled to be a part of contribution. However, it is the responsibility of the employer to contribute their own shares in respect of these employees.

Benefits of ESIC registration
  • Sickness benefits at the rate of 70% (in the form of salary), in case of any certified illness certified and which lasts for a maximum of 91 days in any year
  • Medical Benefits to an employee and his family members
  • Maternity Benefit to the women who are pregnant (paid leaves)
  • If the death of the employee happens while on work – 90% of the salary is given to his dependents every month after the death of the employee
  • Same as above in case of disability of the employee
  • Funeral expenses
  • Old age care medical expenses
  • In case there is any permanent disablement to the insured person, 90% of his salary is provided as a monthly payment in the form of insurance benefit
  • An insured person having insurance for more than three years is provided unemployment benefits which become unemployed. Such allowances are provided at the rate of 50% of the salary for one year
  • 26 week of maternity benefits are provided to a pregnant woman working in an entity. Also, this period can be extended up to 30 days in case it is medically advised.
Entities covered under ESIC

As per the government notification dated Sec 1(5) of the ESI Act the following entities are covered:

  • Shops
  • Restaurants or Hotels only engaged in sales.
  • Cinemas
  • Road Motor Transport Establishments
  • Newspaper establishments (which is not covered under the factory act)
  • Private Educational Institutions
Documents
  • A registration certificate obtained either under the:
  • Factories Act
  • Shops and Establishment Act
  • Certificate of Registration in case of Company, and Partnership deed in case of a Partnership
  • Memorandum of Association and Articles of Association of the Company
  • A list of all the employees working in the Establishment
  • PAN Card of the Business Entity as well as all the Employees working under the entity
  • The compensation details of all the employees
  • A cancelled cheque of the Bank Account of the Company
  • List of Directors of the Company
  • List of the Shareholders of the Company
  • Register containing the attendance of the employees
Procedure for Registration :
  • Form No – 1 (Employers Registration Form) is to be downloaded and filled.
  • After downloading the PDF version of the form and filling it, it has to be submitted to ESIC website itself along with the above-mentioned documents.
Process after the form verification
  • After verification of the form, the government will issue a 17 digit unique number
  • The employee who is registered under this scheme will provide the employer with the filled form and photographs of his own family members as a part of the process of registration and will get an ESI card after registration
Post-Registration Compliances
  • Any change in the Company or its employees will be intimated to the ESIC
  • Register of Attendance of the Employees
  • Form 6 – Register
  • Register of wages
  • Register of any accidents which have happened on the premises of the business
  • Monthly returns and challans
  • Inspection book
  • After ESI Registration, the annual return needs to be filed twice a year.
Employees Registration Process

Employees are required to fill Form 1, and two copies of the family photo also need to be submitted to the employer, which after that is submitted with the relevant ESI Branch Office by the employer.

Insurance Number

For the purpose of identification under the ESI scheme, an insurance number will be allotted to the employee.

Temporary Identity Card issuance

For availing the medical benefit for him/ herself or on behalf of his/ her family, a temporary identity card will be granted to employees for a duration of three months.

Permanent Photo Identity Card

Finally, a Permanent Photo Identity Card is issued.

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