This Blog is Written by Aditya Sahijpal.
Introduction
Employee’s State Insurance Corporation or ESIC is one of the statutory bodies that comes under the Ministry of Labour and employment, Government of India, the other one being the Employee Provident Fund organization. ESIC organization is responsible for the implementation of provisions of the Employees State Insurance Act, of 1948.It was established to safeguard the interests of workers and provide them with essential benefits like Medical care, disability benefits, sickness benefits, maternity benefits, etc. It safeguards the needs of workers even if they are injured in occupational hazards while in work involving dangerous tasks.The members of the executive organ are nominated which includes three members nominated each from the Centre and the state governments. Furthermore, three more members are elected from the corporation itself which act as representatives of medical professionals and parliament. Other than this, the Secretary of the Ministry of Labour serves as chairman of the committee.
History
This act started in the mid 1940s when industrialization in India gained momentum and there was a need to safeguard the economic and physical interests of workers. The act was enacted in the year 1948 after a report from Prof. B. P. Adarkar. The program officially came into existence on February 24, 1952, with the establishment of the Employees’ State Insurance Corporation, and was first implemented in industrial hubs of Kanpur and Delhi before spreading to the rest of the country.
Eligibility criteria for the act
To be eligible for the benefits;-
Wages
Employees need to have less than ₹21,000 per month salaries to be eligible for ESIC. People with disability can claim it if their monthly wages are under ₹25,000.
Establishment employee strength
Establishments need at least 10 employees( 20 in some states like Maharashtra) to be eligible for registration under ESI
Type of establishment
ESIC primarily covers factories, industrial sectors, commercial sectors, medical centers, educational institutions, shops, restaurants, etc. However, they don’t cover seasonal establishments.This act covers the entirety of India however rules can differ from state to state.
Funding of the Scheme
ESI is self-funded scheme. It is mandatory for employers or establishments to register under ESIC within 15 days of applicability to them. Employees cover 1.75% of their salary with the employer contributing 4.75% towards ESI. State governments contribute 1/8 of the medical benefits. Also, employees with a monthly salary less than rupees 50 per day are exempted from paying but their employers are still required to contribute for them..
Registration under ESIC
Documents required for registration
1) Registration certificate under Shop and Establishment act 1948 or Factories Act.
2) PAN card of business and employees.
3) Address proof of the establishment.
4) List of employees along with their names, address and wages.
5) List of major shareholders and names of major directors.
Registering online
1) Visit the https://www.esic.in/ESICInsurance1/ESICInsurancePortal/Signup.aspx site
2) Employer needs to register here on the registration form and submit the details.
3) Confirm your establishment under specific other details on the website.
4) An email will be sent to you for login details.
5) Submit your username and password in the link provided in the email.
6) Now you need to visit the https://esic.gov.in/ portal to login into your account with the username and password which you made up before.
7) Select “New Employer Registration”.
8) Select your type of unit and submit it. Now on the next page enter the name of the unit and complete address of the establishment along with the police station your establishment is present in.
9) Enter the nature of your establishment along with PAN details, category, etc., and click on “next”.
10) On the next page, enter the date of commencement of business and license details.
11) Enter the total number of employees in the establishment and employees earning less than rupees 21,000 per month and save.
12) Enter the details of when the first 10 or 20(depending on the state) employees and when were employed, and then click on “employee declaration form”.
13) Enter details of employees who have not been registered in the past and click on “Continue”. Then click on the displayed info check boxed and click on “submit”.
14) When everything is done, open the region’s respective ESI branch office and the inspection division. Check on options that say the information is correct and click on “submit”.
15) You will be taken to a new page which will tell you to start “Pay initial contribution” and submit it.
Applying for ESI card
ESI cards are used for claiming benefits at impaneled hospitals and dispensaries. It has the personal information of the beneficiary along with a face ID.
To claim it, employers need to visit the ESIC branch to collect it or a smart card may be delivered to the registered address. You can download it by:-
1)Visit https://esic.gov.in/
2)Under the “Employee section” click on “e-Pehchan Card”.3)Select your ID and print it.
4)This also needs to be attested and signed by an ESIC official.
Benefits provided by ESI scheme
Section 46 of the Act envisages the following six social security benefits:-
(a) Medical Benefit:
Full medical care is provided to an Insured person and his family members from the day he enters insurable employment. There is no ceiling on expenditure on the treatment of an Insured Person or his family member. Medical care is also provided to retired and permanently disabled insured persons and their spouses on payment of a token annual premium of Rs.120/-. System of Treatment Scale of Medical Benefit Benefits to Retired IPs Administration of Medical Benefit in a State Domiciliary treatment Specialist consultation In-Patient treatment Imaging Services Artificial Limbs & Aids Special Provisions Reimbursement
(b) Sickness Benefit(SB):
Sickness Benefit in the form of cash compensation at the rate of 70 percent of wages is payable to insured workers during the periods of certified sickness for a maximum of 91 days in a year. In order to qualify for sickness benefit the Insured Person is required to contribute for 78 days in a contribution period of 6 months. 1. Extended Sickness Benefit(ESB): SB extendable up to two years in the case of 34 malignant and long-term diseases at an enhanced rate of 80 percent of wages. 2. Enhanced Sickness Benefit: Enhanced Sickness Benefit equal to full wage is payable to insured persons undergoing sterilization for family planning up to 7 days/14 days for Vasectomy and Tubectomy respectively.
(c) Maternity Benefit (MB):
Maternity Benefit for confinement/pregnancy is payable for Twenty Six (26) weeks, which is extendable by a further one month on medical advice at the rate of full wage subject to contribution for 70 days in the preceding two Contribution Periods.
(d) Disablement Benefit Temporary disablement benefit (TDB):
From day one of entering insurable employment & irrespective of having paid any contribution in case of employment injury. Temporary Disablement Benefit at the rate of 90% of wage is payable so long as the disability continues. Permanent disablement benefit (PDB): The benefit is paid at the rate of 90% of the wage in the form of monthly payment depending upon the extent of loss of earning capacity as certified by a Medical Board
(e) Dependants Benefit(DB):
DB paid at the rate of 90% of wage in the form of monthly payment to the dependants of a deceased Insured person in cases where death occurs due to employment injury or occupational hazards.
(f) Other Benefits :
Funeral Expenses: An amount of Rs.15,000/- is payable to the dependents or to the person who performs last rites from day one of entering insurable employment.
Confinement Expenses: An Insured Woman or an I.P. in respect of his wife in case confinement occurs at a place where necessary medical facilities under the ESI Scheme are not available.
Conclusion
ESI serves as a vital net for worker’s benefits, providing financial and healthcare protection including sickness, maternity, disability, and unfortunate incidents arising from their employment. By offering comprehensive medical care and financial benefits, ESIC alleviates the economic burden on workers and promotes a healthier and more productive workforce.
FAQs on How to Successfully Complete ESIC Registration for Your Business
1. What is ESIC Registration, and why is it important for my business?
ESIC Registration stands for Employee State Insurance Corporation Registration, a mandatory registration process for businesses to provide social insurance benefits to employees. It ensures that employees receive medical care expenses and other benefits in case of illness or injury.
2. Who needs to complete ESIC Registration?
All business establishments with a minimum of 10 employees (20 employees in certain states) must complete ESIC Registration. This includes non-seasonal factories, newspaper establishments, road motor transport establishments, and more.
3. How can I initiate the ESIC Registration process?
To start the ESIC Registration procedure, visit the ESIC online portal and fill out the application form with accurate employee details and business entity information.
4. What documents are required for ESIC Registration?
You will need documents such as a valid proof of registration, bank statement, rental agreement, and a month-wise list of employees along with their salary details.
5. How can I pay the registration fees for ESIC Registration?
Payment for registration can be made through the system-generated Registration Letter using various payment modes available on the ESIC portal.
6. What is the 17-digit Registration Number, and how do I obtain it?
The 17-digit Registration Number is a unique identifier for your business under ESIC. You will receive it upon successful registration.
7. Can I complete ESIC Registration for my business on the ESIC portal or government registration portals?
ESIC Registration can only be completed on the ESIC online portal, not on government registration portals.
8. What is the process for obtaining a Certificate of registration for ESIC?
Once your ESIC Registration is approved, you will receive a system-generated Registration Letter, which serves as your Certificate of registration.
9. Are there any benefits for employees after ESIC Registration?
Yes, employees covered under ESIC Registration are entitled to various benefits, including medical care expenses, cash benefits, and more in case of certified illness or injury.
10. What is the contribution rate for ESIC Registration, and how is it calculated?
The contribution rate is a percentage of the employee’s salary payable by the employer. It is calculated based on the salary details provided during registration.
11. Is there a specific day of delay for payment of contribution under ESIC Registration?
To avoid any default in payment, you should pay contributions within 42 days of the end of the contribution period.
12. What happens in case of a default in payment for ESIC Registration?
Default in payment can lead to legal issues and may affect the benefits provided to employees. It’s important to make timely contributions.
13. Can businesses cover contract employees under ESIC Registration?
Yes, businesses can cover contract employees under ESIC Registration if they meet the eligibility criteria.
14. How can I update employee attendance and contribution details on the ESIC portal?
You can update employee attendance and contribution details on the ESIC portal through the Employee Attendance section.
15. What are the major benefits of ESIC Registration for businesses and employees?
The major benefits include medical care expenses, cash benefits, death benefits, and dependent benefits for employees, while businesses gain legal compliance and a positive work environment.
16. How do I register for other mandatory registrations like Professional tax or Shops and Establishment Registration?
ESIC Registration is separate from other government registrations. To register for professional tax or shops and establishment, follow the respective guidelines and application process.
17. Can I complete ESIC Registration for multiple Business Units under the same business entity?
Yes, ESIC Registration allows you to register multiple Business Units under a single business entity.
18. How can I contact ESIC for assistance during the registration process?
For assistance, you can visit the ESIC department portal or use the contact details provided on the ESIC online portal. Ensure you have an email confirmation for reference.
19. What is the role of the Common Portal in ESIC Registration?
The Common Portal is the online platform where you initiate and complete the ESIC Registration process. It also provides access to various resources and tools for business compliance.
20. Where can I find my Employer code, HSN Code, and captcha code during ESIC Registration?
You will find your Employer code, HSN Code, and captcha code in the respective fields on the ESIC portal while filling out the registration form. These codes are essential for the registration process.
