Employees’ State Insurance (ESI) Registration

What is ESI?

Employees’ State Insurance is a social security program for Indian workers. Under this scheme, the employee is provided medical and disablement benefits. It is compulsory for almost all private limited companies to register under the ESI Act, 1948. Any failure to do so makes them liable to penal actions.

Employee State Insurance is a self-financing social security scheme and health insurance plan. It offers medical and disablement benefits. Governed by the ESI Act, 1948, it is managed by the Employees’ State Insurance Corporation (ESIC) under the Ministry of Labour and Employment.

Why should I register for ESI?

  • Complete medical care to all persons registered under ESI  and their family members.
  • Retired and permanently disabled insured persons and their spouses are provided the medical care on payment of Rs.120/- of a token annual premium.
  • Sickness Benefits. This benefit is provided at the rate of 70% (in the form of salary) and is payable in case of certified sicknesses for a maximum of 81 days in a year.
  • In order to be eligible for the sickness benefit, the insured worker has to contribute for 78 days for the period of 6 months.
  • Workers can claim extended sickness benefit upto 2 years at an enhanced rate of 80% of salary, in case he / she is suffering from long-term diseases.
  • Maternity benefit for pregnancy is provided for 3 months.
  • Extendable by further one month on medical advice at the rate of complete salary subject to contribution for 70 days in the next year.
  • Disablement and Dependant benefit
  • In case of permanent disablement, the benefit is payable at the rate of 90% of wage in the form of monthly payment as certified by Medical board.
  • If in case of the death of an employee during company premises Dependant benefit is paid at the rate of 90% of the salary to his / her dependants every month after the death of the employee.
  • Funeral expenses
  • Dependants or the person who performs the last rites, Rs. 10000/- is paid to them from the day 1 of entering the insurable amount.
  • Old age care medical expenses
  • Medical facilities are free of cost for the insured persons who go out employment because of old age or disability due to a work-related injury.
  • Unemployment allowance. Under Rajiv Gandhi Sharmik Yojana, unemployment allowance is payable to the insured worker who becomes unemployed after being insured for 3 or more years. The allowances provided are:
  • Unemployment allowance equal at the rate of 50% of salary for a maximum period upto 1 year.
  • Medical care for self and family members from ESI hospital during the period zip receives unemployment allowance
  • Also, vocational training is provided for upgrading skills – Expenditure on fee / traveling allowance.

Proofs Required to register for ESI

  • A registration certificate/ license obtained under Shops and Establishment Act or Factories Act.
  • Certificate of registration (MoA and AoA in case of private limited company, p  artnership deed for LLPs, etc).
  • Certificate of registration for all entities and commencement of production for factories.
  • A list of employees with their detailed monthly compensation.
  • A list of directors, partners and shareholders of the company.
  • Business PAN card, address proof of the establishment/firm.
  • Bank statements of the organization, with proof of commencement of operations.

How to register for ESI?

  • The company can apply for registration by submitting the Employer’s Registration Form once required documents are ready (Form-1).
  • A PDF format of the form is available on the website. Fill in the form and submit it to ESIC for registration on the official website.
  • Upon verification, a 17-digit unique identity number will be provided. The ESI filings can be done once this is received.
  • Employees registered under the scheme get an ESI card after submitting a form with photographs and details of family members.