ESI Registration

ESI Registration

Employee State Insurance (ESI) is a government compliances of companies to help their employees. Our cloud PaaS platform thelegal bank provides the complete ESI registration and compliance for your company or business. ESI plan is a contributory reserve that empowers Indian representatives to exploit self-financing and human services protection stores contributed by the worker and the business.
ESI stands for Employee State Insurance managed by the Employee State Insurance Corporation which is an autonomous body created by the law smaller than the Ministry of Labour and Employment, Government of India.
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. Workers' State Insurance Corporation ("ESIC") is a statutory corporate body set up under the ESI Act 1948, which is in charge of the organization of ESI Scheme. The ESI plan is a self-financed far-reaching government disability plan contrived to secure the workers secured under the plan against monetary trouble emerging out of occasions of ailment, disablement or death due to employee injuries.
The ESIC has its headquarters at New Delhi besides 23 regional offices, 26 sub-regional offices in the states and over 800 local offices throughout the country to support the implementation of ESI scheme. In addition, the Medical Benefit Council, a specialized body that advises the ESIC on the administration of Medical benefit is functioning.
Composition of ESIC
The ESIC generally consists of the following members as explained below.
The ESI plan is pertinent to all production lines and different foundations as characterized in the Act with at least 10 people utilized in such foundation and the recipients' month to month pay does not surpass Rs 21,000 are secured under the plan. Whether the employer has employed 10 or more employees, all employees employed by the employer, agnostic of the salary are reckoned.
The applicability of the scheme is explained through a flow chart below:
Note:
The scheme under the act also supports restaurants, motor road transports, newspaper establishments and undertakings, movies and purview theatres, hotels, shops.
The threshold for coverage of establishment is 20 employees in Maharashtra and Chandigarh.
Highlights of the plan Complete medicinal consideration and consideration are given by the plan to the representative enlisted under the ESI Act, 1948 at the season of the inadequacy restoration of his health and working capacity. During absenteeism from work due to illness, maternity or factories accidents, which result in loss of wages complete financial assistance, is provided to the employees to compensate for the wage loss. The scheme provides medical care to family members also. As on 31 March 2017, 2.93 crore employees are covered under this scheme with the total number of beneficiaries summing up to 12.40 crores. Broadly, the benefits under this scheme are categorized under two categories, 1) cash benefits (which includes sickness, maternity, disablement (temporary and permanent), funeral expenses, rehabilitation allowance, vocational rehabilitation, and medical bonus) and, 2) non-cash benefits through medical care. The scheme is self-financing and being contributory in nature. The funds under the ESI scheme are primarily built out of the contribution from the employees and employers payable monthly at a fixed percentage of wages paid. Currently, the employee contribution rate is 1.00% of the wages and that of employers is 4.00% of the wages paid. For newly implemented areas, the contribution rate is 1% and 3% respectively for employees and for the first 24 months. The employer create the grant form its own shares in favor of those employees whose daily average wage is Rs 137 as these employees are exempted from own contribution The employer is required to pay his contribution and deduct employees’ contributions from wages and deposit the same with ESIC within 15 days from the last day of the calendar month in which the contributions fall due. The payment can either be done online or through designated and authorized public sector banks.

Entities Covered

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

  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

Documents

The documents required for the registration are :

  1. An enlistment declaration acquired either under the:
  2. Certificate of Registration in case of Company, and Partnership deed in case of a Partnership
  3. Memorandum of Association and Articles of Association of the Company
  4. A list of all the employees working in the Establishment
  5. PAN Card of the Business Entity as well as all the Employees working under the entity
  6. The compensation details of all the employees
  7. A cancelled cheque of the Bank Account of the Company
  8. List of Directors of the Company
  9. List of the Shareholders of the Company
  10. Register containing the attendance of the employees After collecting all the above-mentioned documents, the following procedure is to be followed for the registration of the ESI:
    • 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 on the website itself along with the above-mentioned documents.

Procedure

  1. Getting ESI Registration:
  2. Establishments or Factories must get themselves registered within 15 days of the Act becoming applicable to them by submitting an Employer’s Registration Form (Form-01) to the relevant Regional Office.
  3. Obtaining Code Number:
  4. A 17-digit identification number called the Code number will be provided which must be used in all Correspondence relating to the Scheme. Form 3 (Return on Declaration) must also be submitted along with Form 1.
  5. For Employees:
  6. At the time of joining the insurable employment, employees are required to fill in a Declaration Form (Form1) and submit two copies of a family photo to the employer, which must be submitted to the relevant ESI Branch Office by his employer.
  7. Insurance Number:
  8. The employee will then be allotted an insurance number for the purpose of his identification under the scheme.
  9. Temporary Identity Card:
  10. The employees will also be issued a temporary identity card for availing medical benefit for him/herself and his/her family for a duration of three months.
  11. Permanent Photo Identity Card:
  12. Thereafter, he will be provided with a permanent photo identity card. A person once registered need not register again when there is a change of employment. The same registration can be transferred from one employment to another.

Benefits

The benefits of ESI registration are offered by ESIC with efficient support of its large network of branch offices, dispensaries, and hospitals located all across India. Broadly, the major welcome benefits to the contributing employees cover the following:

  • Sickness benefits in form of salary at the rate of 70%, in case of any certified sickness lasting for a maximum of 91 days in any year.
  • An array of medical benefits and facilities to the employee and his/her family.
  • Maternity benefit to pregnant woman employees in form of paid leaves for three months.
  • In case of death of an employee caused by any occupational hazard, ESIC pays 90% of his/her salary to his/her dependents every month.
  • Disability to work will be paid at the rate of 90% of the monthly salary of the concerned employee.
  • Other benefits offered to employees by ESIC include funeral expenses compensation, physical rehabilitation, vocational rehabilitation, old age medical care, etc.

FAQ's

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

Yes, it is mandatory requirement for every employer who comes under this act to register their Factory/ Establishment.

Every employer covered under this act has to comply with various compliances such as deposit of monthly contribution, in order to file half yearly return and report to ESIC authorities if there is any change in business activity, address, ownership and the management, maintenance of registers and records etc.

No, right to receive any benefits under this act is not transferable.

It is a 17-digit unique identification number allotted to every registered establishment. This number is generated through the ESIC portal on submission of the required information by the employer or generated on receipt of a survey report from the Social Security Officer.

Yes, it is the statutory responsibility of the employer register their Factory/ Establishment under the ESI Act within 15 days from the date when the act becomes applicable to them.

Contribution will be paid for an employee in to a bank duly authorised by the Corporation within 21 days of the last day of the month in which the contribution is due for any wage period.

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.

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

The scale of medical benefit includes a complete medical treatment from start to finish.

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Manish Moyal

Director

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Director

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Puspandra

Director

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