Published on February 28, 2024 ESI

A Comprehensive Guide to ESI Registration for Employers

Employee's State Insurance Corporation (ESIC), an Indian government body, offers financial security to workers in many professions. It provides the employees' families with econ...

Employee's State Insurance Corporation (ESIC), an Indian government body, offers financial security to workers in many professions. It provides the employees' families with economic and healthcare benefits. The employees must register under the ESIC system to get these benefits. If done correctly, registering under ESIC is a simple process. Here is all the information you want to know about the ESIC registration procedure, whether you are an employer seeking to register your company, your employees, or a worker looking to register with the ESIC.

What is ESIC?

The Employee State Insurance Corporation (ESIC) manages the Employee State Insurance scheme, also called the ESI. ESIC is an autonomous organisation supervised and monitored by the Ministry of Labour and Employment of India.

What is the primary purpose of the ESIC scheme?

The Employees' State Insurance Scheme (ESIC) is a health insurance programme that is contributed to daily wage workers, labourers, and their families.
The primary purpose of ESIC is to provide financial support during hospitalisation and similar situations. For Indian workers, the Employee State Insurance Corporation (ESIC) is a self-financing health scheme. It offers medical benefits to workers and their families via a large number of hospitals, clinics, and authorised private healthcare facilities.
All companies are legally required to enrol their eligible workers in the Employees' State Insurance Corporation (ESIC) scheme, which the Employees' State Insurance Corporation runs under the Ministry of Labour and Employment.

Who is eligible for ESIC registration?

According to the ESIC Act 1948, any industry or firm with more than 10 workers earning a threshold amount of Rs 21,000 a year (Rs 25,000 in case of employees with a disability) is required to register with ESIC. All individuals earning Rs 21,000 or less in a month are eligible for medical insurance benefits under ESIC as soon as the organisation registers with ESIC.

What is the contribution share of ESIC rates?

The ESIC came into existence to offer workers, their immediate families, and their dependents financial support. The ESIC announces the contribution rates, which are regularly updated. Both the employer's and employee's contributions are included in the ESIC contribution. Each employee's ESI contribution varies depending on their pay. Each employee's ESI contribution for the FY 2023-24 is as follows:

The employer contributes 3.25 percent (%) of the employee's pay
Employee contributes 0.75 percent (%) of the employee's pay

Employer/Employee contribution	Contribution percentage (%)
Employee contribution	0.75 % of salary
Employer contribution	3.25 % of salary

Which types of entities are eligible for ESIC registration?

According to Section 1(5) of the ESI Act, the list of companies or entities covered (under State government) ESIC are :

private medical centres and pharmacies
retail stores or shops
restaurants
theatres
municipal corporation workers on a contract basis
private universities and colleges

What documents are required for ESIC registration?

To register under the ESIC scheme, the employer or organisation needs to submit the following documents:

Employees’ PAN card copy
Employees list and details of their monthly salary
latest receipt of property tax or EB receipt
Employer’s PAN Card copy
Registration Certificate issued under the

Shop & Establishment Act
Factories Act

GST Registration Certificate (optional)
MoA and AoA, in case of companies
Address proof
Partnership Deed in case of Partnership Firms
Trust Deed in case of Trusts
Latest Bank Statement copy

Final Thoughts

The benefits of ESI registration extend to employers as well as employees of an organization. It contributes to the creation of a more secure, safe, and safe work environment. With our assistance, employers can complete the registration process easily and conveniently online. In addition to protecting workers against possible hazards at the workplace throughout their period of eligible employment, ESI registration also boosts productivity, and general satisfaction with employment. It is recommended for readers to visit our website to know about the services our professional experts offer.

Frequently Asked Questions (FAQs)

1. Is ESI registration mandatory for all factories and companies?

Any factories or other enterprises in India that employ 10 or more people at a maximum salary of Rs. 21,000 are required to register with ESI. In certain states, the number of employees in a factory or company can be around 20.

2. Who regulates the contribution share of employees and companies?

The ESI scheme's contribution rate is set and monitored by the Indian government.

3. What is the current contribution rate set according to the ESI Act?

The Indian government sets the ESI scheme's contribution rate. There are periodic revisions to the rates. As of 2023, the government has reduced the contribution rate, effective June 1, 2019. The employer's contribution rate is 3.25% of the earnings, while the employee's contribution rate is 0.75% (effective July 1, 2019).

4. Can a company with less than 10 employees choose to register under ESI?

An employer can decide to register under ESI even if they employ less than 10 people. Even if the employer has less than 10 employees, they must follow ESI laws after registering.

5. Can an individual claim benefits under involuntary job loss under ESIC?

In the case of an involuntary termination of an employee or a permanent disability from employment, ESIC offers a monthly cash allowance for the individual for a maximum period of 24 months.

6. Is there any deadline for the deduction of ESI?

The employee's ESI contribution is deducted and paid to the government monthly. Thus, the deadline for ESI payments is every month, on or before the 15th of the following month.

7. Who is exempted from contributing to the ESIC scheme?

Employees or workers whose average daily wages are less than 137 rupees (INR) are exempted from contributing to the ESI contribution.