Employees State Insurance (ESI) Registration

//Employees State Insurance (ESI) Registration

Employees State Insurance (ESI) Registration

Employees State Insurance (ESI) Registration is important because it provides numerous of fruitful benefits to the employees also it provides the safety in various ways. ESI is a self-financial social security and health insurance scheme for Indian workers. It is a scheme which is designed to provide social protection to the employees against the uncertain event in the organization such as:

  • Sickness
  • Disablement, and
  • Death, etc.

During the course of employment, also it provides the medical care to the employees and their dependents. Employees registered under the scheme will receive complete medical facility during the period of incapacity. To compensate for the loss of wages during the period of absence from the work due to the illness, maternity, employment injury, etc. it provides monetary assistance. It is mandatory to apply for registration for all those establishment or factories who has more than 10 employees or it is mandatory for all companies with 10 or more employees, and have to get registered with ESI within 15 days of ESI Act,1949 becoming applicable to them. In some states, the minimum number of employees required for registration is 20 or more and few states have not included the medical and educational institution. There is a various medium who can help you to get registered with ESI, one can go to Legalraasta for registration as it provides an easy and quick way to get registered with ESI.

Entities which are covered by ESI

According to the section 1(5) of ESI Act the following entities are covered:

  1. Shops
  2. Hotels or restaurants (only engaged in sales)
  3. Cinemas
  4. Newspaper establishment (only which are not covered under the factory act)
  5. Private Educational Institution, and
  6. Road Motor Transportation Establishment.

Documents required for Employees State Insurance (ESI) Registration

The following documents are required for ESI registration:

  1. A registration certificate obtain under the
    1. Factories Act, or
    2. Shop and Establishment Act
  2. If it is a company
    1. Certificate of registration is required
  3. If it is a partnership
    1. The Partnership Deed is required
  4. Memorandum of Association of the company.
  5. The article of Association of the company.
  6. List of employees working in the establishment.
  7. PAN card of business entity.
  8. PAN card of employees working under the entity.
  9. Employee’s compensation details.
  10. List of all directors of the company.
  11. List of shareholders of the company.
  12. Register in which attendance of all the employees is recorded.

After collecting the above documents the given below has to be followed for the registration of the ESI:

  • Employee Registration Form (Form-1) is to be filled.
  • Submit the form on the website along with the above-mentioned documents.

The process after the form verification

  1. The Government will issue a unique number of 17 digits after the verification of the form.
  2. Employee (who is registered under this scheme) will provide a photograph and a filled form of his family members as a part of the process of registration and he will receive ESI card after registration.
  3. Intimate to ESIC if any change in the company or its employees takes place.

Number of returns are filed after the registration is finalized

ESI return has to be filed twice a year. The following documents are required for filing the return:

  • Register of wages
  • Form-6 register
  • Monthly return
  • Record of the accidents which took place on the premises of the business (if any).
  • Attendance register of employees

Benefits of Employees State Insurance (ESI) Registration

There are numerous benefits under this scheme, some of them are given below:

  1. In case of certified illness which last at least for 91 days in a year then in the form of salary, the sickness benefit is available @ 70%.
  2. Funeral expenses are provided.
  3. Old age care medical expenses are provided.
  4. While working if the employee passed away then 90% of the salary will be provided to the dependent of a deceased person.
  5. Maternity benefits to the women are provided.
  6. Medical benefits to the employee and his family members are provided.
  7. If the employee got disabled at the time of the employment then 90% of his salary will be paid to the employee and his family after such disablement.

Provisions related to the Employees State Insurance (ESI) Scheme

Provisions related to the ESI Scheme are as under:

Applicability

If any business has more than 10 employees then it is mandatory for such business to get registered with ESI scheme.

Contribution

The ESI is scheme is financed by contribution raised from both employees and employers covered under the scheme. The rate of the contribution by employees and employer are:

AEmployee’s Contribution1.75% of total wages
BEmployer’s Contribution4.75% of total wages

 

If all the employees are drawn more than INR 15000 per month in such case that establishment has to mandatorily register in ESI Scheme.

Collection of contribution

In respect of every employee, an employer is liable to pay his contribution and deduct employee’s contribution from their wages and must pay this contribution to the corporation within 21 days from the last day of the calendar month in which the contribution due falls.

Contribution PeriodCorresponding Cash Benefit Period
1st April to 30th September1st January of the following year to 30th June
1st October to 31st March of the year following1st July to 31st December

Provision for the delay in contribution

Period of delay% of Damages
Less than 2 months5%
2 to 4 months10%
4 to 6 months15%
6 months and above25%

Amendments

There have been few amendments which are given below:

The definition of dependents now include

    • Widow
    • Legitimated or adopted a son who has not attained the age of 21 years.
    • An unmarried legitimate or adopted daughter.

By Akanksha Singh

By | 2018-04-02T06:42:03+00:00 March 29th, 2018|ESI Registration|Comments Off on Employees State Insurance (ESI) Registration

About the Author:

Himanshu Jain is the founder of LegalRaasta – India's top portal for registration, trademark, return filing and loans. Himanshu is a CFA (US) & MBA (ISB). He has over 8+ years of corporate / consulting experience with top firms like McKinsey