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  • Overview
  • Eligibility
  • Benefits
  • Process
  • Documents
  • Entities Covered
  • Rate of Contribution
  • Compliances After Registration
  • Period Of Contribution
  • Returns To Be Filed
  • How Can ApkaTax Assist You?
  • Fees
  • FAQs

What is ESIC Registration?

Employee State Insurance, commonly called ESIC or ESI is a government insurance scheme in India designed to provide various benefits, including medical and financial support to registered workers. The ESI falls under the purview of an autonomous body known as the Employee State Insurance Corporation, which operates under the Ministry of Labour and Employment.

According to the law, any company employing more than 10 employees (in some states, the limit is 20 employees) must register for ESI. Employees earning a monthly income exceeding ₹21,000, including basic salaries and dearness allowance, have their insurance contributions deducted from their paychecks. It is self financing social security scheme. There are medical monetary and other benefits involved. The ESI scheme offers a range of advantages to employees enrolled in the program, including access to an extensive network of dispensaries, hospitals, and medical clinics for swift healthcare delivery to insured individuals. An organization is required to obtain an ESI registration certificate within 15 days of becoming eligible. 

It's important to note that ESIC regulations differ from one state to another, leading to variations in specific rules and provisions. The ESI scheme is governed by The Employees' State Insurance Act of 1948 (ESI Act), ESI General Regulations 1950 and ESI Central Rules 1950. 

 

What is ESIC Eligibility?

Before registering itself on ESIC a factory or establishment must adhere to certain guidelines and must fulfill certain eligibility criteria. The following is the eligibility criteria for  "Factory" under the ESI Act:

  • The premises must be used for manufacturing.
  • The manufacturing process must involve the use of power.
  • At least ten employees must work on the premises.
  • These employees should have worked on the premises for the previous twelve months.
  • Any premises meeting these criteria are legally considered a factory under the ESI Act.
  • It is essential to note that mines do not come under this definition.
  • Similarly following is the Definition of "Establishment" under the ESI Act
  • Key criteria for premises to be considered an establishment under the ESI Act include:
  • The premises must engage in some economic activity.
  • There should be at least ten employees working on the premises for wages.
  • These employees must work on the premises for at least 240 days within the preceding 12 months.
  • This applies on factories as well as other types of establishments, including hotels, restaurants, cinemas, educational institutions, medical institutions, transport undertakings, and warehousing establishments.
  • Additional eligibility criteria include:
  • Employees earning gross salaries of up to ₹21,000 per month, with contributions made by the employer.
  • Establishments registered with EPFO.
  • Industrial units with a risk of injury or health issues must provide ESI for all employees earning less than ₹21,000.

Any premises meeting these criteria are legally considered an establishment under the ESI Act. Additionally, the ESI Act allows for extending its coverage to establishments with fewer than ten employees through government notifications. Contribution to ESI consists of 6.5% of the gross salary, divided as 4.75% by the employer and 1.75% by the employee.

What are the Benefits of ESIC Registration?

ESIC Registration provides several advantages to employees, including:

  • Medical Aid: ESIC Registered members and their families are entitled to comprehensive medical care and insurance benefits from the first day of employment.
  • Maternity Aid: Pregnant women receive maternity benefits for up to twenty-six weeks, extendable by 30 days on medical advice, provided the employer contributes their wages for 70 days in the preceding two contribution periods.
  • Disablement Benefits: Disabled employees can receive 90% of their monthly salaries as disablement benefits.
  • Sickness Benefits: Employees can take up to 91 days of annual leave during illness, with 70% of their monthly wages.
  • Dependent Benefits: In the event of an employee's demise during employment, the dependents receive 90% of the employee's monthly salary.
  • Funeral Expenses: The deceased employee's family is entitled to an additional ₹10,000 for funeral expenses.
  • Confinement Expenses: Confinement expenses can be availed in cases where an insured woman or employee's wife gives birth in a location lacking ESI medical facilities. It is provided for three months and can be extended for one more month on medical advice, provided a contribution for 70 days was made in the preceding year. 
  • Retirement Benefits: Medical care and benefits continued to be provided in old age and after retirement. 
  • Extended Sickness Benefit: ESI members with chronic diseases can access extended sickness benefits for up to 2 years after the standard 91-day sick leave has been exhausted.
  • Enhanced Sickness Benefit: Registered ESI members opting for sterilization procedures are eligible for enhanced sickness benefits, covering 100% of their daily average wages.

 

ESIC Registration Online Process

The ESIC Registration process involves following steps:

  • Sign up on ESIC portal
  • Confirmation mail containing login credentials. 
  • Filing of Employer Registration Form-1. 
  • Payment of Registration and six months advance contribution.
  • On successful registration and advance contribution payment a registration certificate(C-11) is generated containing 17 digit registration number. It is proof of registration in ESIC. 

We at Apka Tax provide comprehensive and simple ESI Registration process in three steps:

  • Form Filling: We complete the ESI Online Registration form and submit the necessary documents.
  • Verification: Your provided details are cross-checked for accuracy.
  • Submission: Apka Tax submits the ESI registration application and other legal documents within 2 working days, completing your part of the ESI Registration. 

Once the registration is approved, you receive:

  • The 17-digit identification code number
  • Employee insurance number
  • Temporary identity card

 

What are the Documents Required for ESIC Registration?

To register for Employee State Insurance Corporation employers must submit various documents, including:

Registration certificate or license issued under the Shops and Establishments/Factories Act (required for ESI online registration).

  • Address proof.
  • Rent receipt for the occupied premises, indicating its capacity.
  • Copy of PAN card.
  • Copy of Aadhar card.
  • List of employees. 
  • Company Incorporation Certificate or Partnership Deed.
  • Memorandum of Association/Article of Association of Company. 
  • Copy of bank statement.
  • Photocopy of the last building tax/property tax receipt.
  • Photocopy of registration certificate of commencement of production.
  • GST registration certificate
  • For ESI filings, a monthly pay sheet is also required for computing the contribution amount for each employee.

 

What is Entities Covered Under ESI Registration in India?

The ESI Act of 1948 extends to various entities, including:

  • Shops
  • Cinemas
  • Movie theaters
  • Medical institutions
  • Hotels or restaurants
  • Newspaper establishments
  • Private educational institutions
  • Roadside motor transport establishments

Please note that some states may exclude medical and educational institutes etc from ESIC contribution. 

What is Rate of Contribution Under ESI?

Under the Employees' State Insurance (ESI) Act of 1948, the contribution rate is 3.25% of employees' wages by the employer and 0.75% by the employee. Wages for ESI contribution include basic wages and dearness allowance (DA), which compensates for the rising cost of living. Employees getting a daily average wage upto Rs.176/- are exempted from contribution payment. Employers will however contribute their own share in respect of these employees.

What is Compliances After ESI Registration?

After obtaining ESI registration, certain compliances must be followed:

  • The company must follow the ESI Act of 1948 within six months of establishment.
  • If the company is not immediately subject to the ESI Act, it can make its registration number dormant within six months to avoid penalties for non-compliance. The maximum duration for dormancy at one time is six months.
  • The company must log in to the ESI website before 180 days expire from the start of dormancy to extend this status further.

 

ESI Registration: Period of Contribution

The contribution period under the ESI Act is six months, divided into two parts: from 1 April to 30 September and from 1 October to 31 March of the following year. Contributions are payable for the entire six months, even if an employee does not work for the entire period. For example, if an employee joins an establishment on 1 July, contributions for the first period cover the full six months from 1 April to 30 September. Even if an employee is exempt, the employer must contribute on their behalf.

Returns To Be Filed After ESI Registration

Following ESI registration, biannual ESI returns must be submitted. These returns require specific documents, including:

  • Form 6 register.
  • Wages register.
  • Employee attendance register.
  • Monthly returns and challans.
  • Accidents register (for any incidents on the premises).
  • These returns help ensure compliance with ESI regulations and contribute to the proper administration of the scheme.

 

How Can ApkaTax Assist You?

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We provide thorough assistance and comprehensive service for getting your ESIC Registration.

ApkaTax offers comprehensive support for the ESIC Registration application process, including legal assistance based on the specific priorities of our clients.

Our dedicated support team ensures that our clients stay informed about the latest guidelines and updates regarding ESIC Registration requirements and periodic inspections.

 

What is the ESIC Registration Fees In India?

Are you looking for ESIC Registration Fees In India then here the details for you. The ESIC Registration Cost In India start from ₹2000 to ₹10000 along with Government Fee ₹ Nil and Professional Fee ₹ Nil.

Steps

Fees
ESIC Registration Fees In India ₹2000 To ₹10000
Govt Fees Nil
Professional Fees Nil
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The number of employees required for ESI registration is 10.

ESI registration of an employee can be checked online by following these steps: 1. Visit the ESI Corporation website. 2. Click on the 'ESI Registration' tab. 3. Enter the employee's registration number. 4. Click on the 'Check' button.

Following persons are not eligible for ESIC registration: 1. Employees whose wages are less than Rs. 176 per day 2. Employees who are working in establishments with less than ten employees 3. Employees who work in seasonal establishments 4. Employees who are employed in establishments located in rural areas

The upper salary limit in ESIC is Rs. 21,000 per month. This means that the employee's contribution to ESI is calculated on a salary up to Rs. 21,000 per month.

Yes, ESI is calculated on basic salary.

Any establishment, factory or shop employing 10 or more employees must register under the Employees' State Insurance scheme.

The contribution rate is 0.75% by the employee.

The contribution rate is 3.25% of employee’s wages by the employer.

To identify each employee,the ESIC allots a unique identification number to every worker.This number is called the insurance number

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