ESIC Registration

What is ESI Registration

As defined in the Employees' State Insurance Act, 1948, Employee State Insurance provides financial protection to employees against ailments, disablement or demise as a result of work injuries. ESI is managed by the Employee State Insurance Corporation - an autonomous body established under the Ministry of Labour and Employment, Government of India.

According to Section 2(12) of the Act, the ESI scheme is applicable to non-seasonal factories employing 10 or more persons. However, in some states, like Maharashtra and Chandigarh, the threshold for coverage of establishments is 20 employees. Effective 01/01/2017, the existing wage limit for coverage under the Act is Rs. 21,000 per month (Rs. 25,000 per month for individuals with disabilities). All establishments, factories and units that fall under the purview of the ESI Act are mandatorily required to apply for the ESI registration within 15 days of the ESI Act becoming applicable to them.

What are the Steps of ESI Registration?

The registration of employers under ESI Act is completely online. There is no need to submit any physical application documents prior to the registration or post it.

The employer has to first sign up and fill the empty columns as displayed on the ESIC portal. After the login credentials are created, the user must proceed to complete ‘new employer registration’. Some of the information required here will include name of unit, complete postal address, details of owners, details of employees working, etc. Once this is complete, the individual will then be asked to make an advance contribution to complete the registration procedure. A code number will be generated and copy of registration letter is sent to the email address of the employer. The employer can log on to the website of ESIC and undertake various online activities.

What are the Features of ESI Scheme?

The features of the ESIC scheme are as follows:

  • It was introduced by an Act of Parliament in 1948
  • It is applicable to non-seasonal factories with 10 or more employees.
  • The scheme has been extended to shops, restaurants, hotels, cinemas, road-motor transport undertakings, newspaper establishments, establishments involved in insurance business, NBFCs, airport authorities, port trust, and warehousing establishments with 10* or more employees.
  • The scheme, under Section 1(5) of the Act, has been extended to private medical and educational institutions with 10* or more employees in certain States/UTs.
  • The current wage limit for coverage under the Act (effective from 01/01/2017) is Rs. 21,000 per month (Rs. 25,000 per month for persons with disabilities).
  • The scheme is now notified in 540 districts in 34 states and union territories.

(*20 in some states)

What are the Inclusions in ESI Package?

Section 46 of the ESI Act provides for the following six social security benefits:

Medical Benefit

  • System of Treatment
  • Scale of Medical Benefit
  • Benefits to Retired IPs
  • Artificial Limbs & Aids
  • Special Provisions
  • Administration of Medical Benefit in a State
  • Domiciliary treatment
  • Specialist consultation
  • In-Patient treatment
  • Imaging Services
  • Reimbursement

Sickness Benefit

  • Extended Sickness Benefit
  • Enhanced Sickness Benefit

Maternity Benefit

Disablement Benefit

  • Temporary disablement benefit
  • Permanent disablement benefit

Dependants Benefit

Other Benefits

  • Funeral Expenses
  • Confinement Expenses

Source: ESIC website

Types of Documents Required for ESIC Registration

The documents required for the registration are

  • A registration certificate obtained under the Factories Act or Shops and Establishment Act
  • Partnership deed for a Partnership and Certificate of Registration for a Company
  • PAN card of the business entity and the employees working for the entity
  • MoA and AoA of the Company
  • List of all the individuals employed in the establishment
  • Compensation details of all employees
  • Cancelled cheque of the company’s bank account
  • List of the company’s directors
  • List of the company’s shareholders
  • Register with the attendance of the employees

What happens after Verification of ESI Registration Form?

After the registration form is verified, the government shall issue a 17-digit unique number. Employees registered under this scheme shall be given an ESI card, after submitting a form with details and photos of family members. It must be noted that while the registration is permanent and the number is valid for the lifetime of the company, changes (if any) have to be intimated to the ESIC.

Eligibility to Register ESIC Account

According to the government notification, the Act is applicable to:

  • Non-seasonal factories with 10 or more employees
  • Further, the scheme has been extended to shops, restaurants, hotels, cinemas, road-motor transport undertakings, newspaper establishments, establishments involved in insurance business, NBFCs, airport authorities, port trust, and warehousing establishments with 10* or more employees.
  • Private Medical and Educational institutions with 10* or more employees in certain States/UTs.
  • The current wage limit for coverage (effective from 01/01/2017) is Rs. 21,000 per month (Rs. 25,000 per month for individuals with disabilities).

(*20 in some states)

How Many Employees are Required for Registration of Establishment?

StateMinimum employees to be registeredStateMinimum employees to be registered
Himachal Pradesh20Delhi10
Jammu & Kashmir20Karnataka10
Jharkhand10West Bengal10
Kerala10Andhra Pradesh10
Madhya Pradesh10Arunachal Pradesh20
Maharashtra20Assam20
Manipur20Bihar10
Meghalaya20Chhattisgarh10
Mizoram20Goa20
Nagaland20Gujarat10
Orissa10Haryana10
Pondicherry10Uttarakhand10
Punjab10Chandigarh20
Rajasthan10Daman and Diu20
Sikkim20Dadra and Nagar Haveli20
Tamil Nadu20Andaman and Nicobar20
Tripura10Lakshadweep20
Uttar Pradesh20Outside India20

Source: ESIC website

Compliance after ESI Registration

Companies that come under the purview of the ESI Act have to mandatorily file the annual return. The return of contributions should also be submitted with a copy of all ESI contributions paid once every six months. Additionally, organizations must maintain the following records:

  • Attendance Register
  • Wages Record
  • Accident Register
  • Form 6 Register
  • Inspection Book
  • File with all monthly challan & returns submitted

Conclusion

Managed by the Employees' State Insurance Corporation, ESI was formulated with the intent to act as a financial aid in times of medical emergencies. The self-financed social security scheme is designed to protect employees and their loved ones against financial distress arising from sickness, disablement or death due to employment injuries.

FAQ's On ESIC Registration

How can I get ESI Code Number?

Code number is a 17-digit unique identification number which is allocated to establishments and factories registered under the provisions of the ESI Act. This unique ID number is generated via ESIC portal following submission of the required information by the employer. The code number can also be generated upon receipt of Survey Report by the Social Security Officer.

What is a sub-code number?

This is a unique ID number assigned to a sales office, sub-unit, branch office, or registered office of a covered factory or establishment situated in the same state or different state. Any branch or sales office can be registered by the employer through ESIC Portal, using his or her credentials and unique primary registration code number.

How can employers get registered?

The employer has to first sign up and fill the empty columns as displayed on the ESIC portal. After the login credentials are created, the user must proceed to complete ‘new employer registration’. Once this is complete, the individual will be asked to make an advance contribution to complete the registration procedure. A code number will be generated and a copy of registration letter is sent to the email address of the employer.

Who is mandatorily required to complete ESI registration?

Units or establishments with 10 or more employees (20 in some states) who are drawing wages of up to Rs. 21,000 a month are required to be registered for ESI under the ESI Act 1948.

How is the ESI scheme funded?

The scheme is self-financed. The funds are mainly built from contribution of employers and employees, payable monthly at a fixed percentage of wages paid. The state governments also bear a part of the cost of medical benefit.

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