The employee’s state insurance Act, 1948 was enacted by the legislature as an integrated need based on the social insurance scheme. ESI stands for employee state Insurance Corporation is an autonomous body created by the ministry of labor and employment that governs and regulates the employee state insurance in India. ESI is managed and governed by the rules and provisions issued by the ESI ACT 1948.
ESI is like a social insurance scheme that would protect the interest of workers in possibilities such as sickness, maternity, temporary or permanent physical disablement and death due to employment injury resulting in loss of wages or earning capacity. The ACT also guarantees reasonably good medical care to workers and their immediate dependents.
This scheme is started for Indian workers. The workers are provided with a huge variety of medical, monetary and other benefits from the employer. Any company having more than 10 employees who have a maximum salary of RS. 15000/- has to mandatorily register itself with the ESI.
Documents required for ESI registration
- Registration certificate or license issued under shops and establishment acts or factories acts
- Address proof – Latest rent receipt of the premises you are occupying indicating the capacity in which the premises are occupied.
- Photocopy of latest building tax / property tax receipt
- Memorandum and articles of association /partnership Deed /trust Deed depending on the entity that is applying for registration.
- Photocopy of certificate of commencement No. of CST /ST
- Copy of PAN Card
- Evidence in support of the date of commencement of production /business/ first sale.
- Month wise employment position salary etc.
- Business activity of the firm/ company
- Details of bank account along with a cancelled cheque.
- Family photo of employee.
Entities covered under ESI
As per the government notification dated sec1 (5) of the ESI act the following entities are covered –
- Restaurant or hotels only engaged in sales
- Road motor transport establishment
- Newspaper establishment (which is not covered under the factory act)
- Private educational institutions
Procedure for ESI registration
Factories must register within 15 days of the ESI applicability
A 17 digit code number is provided which is used in all correspondence.
At the time of joining, employee s fill a declaration form and submit two copies of a family photo to the employer, which is submitted to the ESI.
The employee will be allotted an insurance number for the purpose of his identification under the scheme.
Temporary number card
The employees are issued a temporary identity card for availing medical benefit for three months. Permanent photo identity card. There is no requirement of re-registration during change of employment and same registration can be transferred from one employment to another.
Benefits of ESI registration
The insured person and his family members are provided with full medical facility from the day he enters insurance service. Medical care is also provided to retired persons and permanently disabled insured persons and their spouses on payment of a token annual premium of Rs.120.
About Sickness Benefits
Sickness benefits are provided to the employees at the rate of 70% of his salary. In case such sickness continued for exceeding 91 days in a year and the same is also certified.
Maternity benefit for pregnancy is payable for twenty six weeks, which is extendable by further one month on medical advice at the rate of full wage subject to contribution for 70 days in the preceding two contribution periods.
Temporary disablement benefit
From day one of entering insurable employment and 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 disability continues.
Permanent disablement benefit
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.
ESIC provides monthly cash allowance for a duration of maximum 24 months in case of involuntary loss of employment or permanent invalidity due to non-employment injury.
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