ESI registration: Benefits, Documents, Eligibility & Process

ESI, or the Employees State Insurance Scheme, is a social security initiative by the Indian Government under the ESI Act of 1948. Managed by the Employees State Insurance Corporation (ESIC), an autonomous body under the Ministry of Labour and Employment, this scheme provides protection to employees against death, disablement, sickness, maternity, and injury related to employment. ESI registration has multiple benefits for employees, that you will discover in this blog. 

To receive medical care and other benefits, employees must be registered under the scheme. The ESI Scheme is self-financed, with employers and employees contributing a percentage of wages monthly. Contact us! Our professionals can help you get ESI registration process smoothly, moreover, they will help you with ESI registration documents, allowing you to focus on your business while we handle the details.

Benefits of ESI Registration in India

There are several benefits of ESI to the employer and employee, some of them are as follows: - 

For Employers:

1. Legal Compliance: Ensures compliance with legal requirements under the ESI Act, avoiding penalties and legal issues.

2. Employee Welfare: Demonstrates commitment to employee welfare, enhancing the company's reputation and employee loyalty.

3. Financial Relief: In case of employee sickness, disability, or maternity, ESI provides financial support, reducing the employer's burden.

4. Boosts Morale: Providing ESI benefits boosts employee morale and productivity as they feel secure about their health and financial well-being.

5. Tax Benefits: Contributions to ESI are deductible as business expenses under the Income Tax Act, reducing the taxable income.

For Employees:

1. Medical Benefits: Access to comprehensive medical care for the insured employee and their family members without additional costs.

2. Sickness Benefits: Cash compensation for loss of wages due to sickness certified by a medical practitioner, up to 70% of wages for a maximum of 91 days in a year.

3. Maternity Benefits: Paid maternity leave for up to 26 weeks for female employees, employers are required to contribute their wages for 70 days in the preceding 2 contributions period. 

4. Disability Benefits: Monthly payments in case of permanent or temporary disablement due to employment-related injury or illness.

5. Dependents' Benefits: Financial support to dependents in case of the employee's death due to employment-related injury or disease.

7. Funeral Expenses: Additional amount of 10,000/- to the dependents or the person who performs the last rites of the deceased insured employee.

Entities Covered Under ESIC

As per the Section 1(5) of the ESI Act, these entities are covered under ESI registration: -

• Private medical institutions

• Road motor transport organizations 

• Cinemas

• Shops

• Newspaper establishments which are not covered under Factory Act

• Hotels and Restaurants engaged only in sales

When at all the above-mentioned establishments number of employees goes above up to 10 or more than 10, in that case the owner of such establishments is required to apply ESIC registration mandatorily.

What is the Eligibility of ESI Registration in India?

ESI registration is applicable when there are 10 or more than 10 employees or workers but, in some areas, ESI registration is also possibly applicable on the establishments, that have more than 20 employees. In order to complete ESI registration, the following eligibility criteria should be satisfied:-

1. The business must be registered with the EPFO.

2. The total contribution of the ESI is 6.5% of the gross salary and further it is divided as follows:-

• 1.75% from employees’ side

• 4.75% from employers’ side

3. An employee, whose monthly salary is up to 21,000 INR can avail of this with employer’s help.

4. For industrial sectors where there chances are high of health issues and injury to the employees along with the salary below 21,000 INR, it is mandatory to get ESI registration.

Required Documents for ESI Registration in India

Following are the some essential documents for successful ESI registration in India:-

1. Registration certificate, received under Shop & Establishment Act and Factory Act

• In case of company Certification of Incorporation is required 

• In case of partnership firm, Partnership Deed is required 

2. GST registration certificate of the business

3. MOA and AOA of the company

4. Address proof of establishment

Any of the following can be attached as an address proof: -

• Recent utility bills such as electricity bill, telephone bill, gas bill, etc.

• Rental Agreement of the land where the establishment is located.

5. Property tax receipts of the establishment’s location.

6. List of employees who are working in establishment.

7. PAN card of the company/business

8. List of all directors and shareholders of the company

9. Cancelled cheque from the company’s bank account

10. Also, a register carries all employees attendance 

Process for ESI Registration 

Steps for process of ESI registration is follows: -

1. Employer signup

2. Get user ID and password to login

3. Select unit type

4. Prepare application form

5. Upload documents and attach DSC

6. Pay advance or Submit

Establishments Need to Comply with the Followings: -

• Follow the process step by step to get ESI registration successfully

• Compliances and Returns after ESI Registration in India

• Maintenance of register of wages of workers

• Maintaining attendance register

• Inspection book

• Monthly return and challan within 15th of succeeding month

After ESI Registration Employer is Required to File ESI Returns Half-yearly, Documents Required for Filing are as Follows: -

• Form-6 register

• Monthly returns and challans

• Attendance register of the employees 

• Register of wages 

Why Should You Choose CRSPL?

1. Detailed Guidance:- The experts of CRSPL provide your every single detail and guidance so that you do not miss any step. We will keep you updated about eligibility criteria, document requirement and process of application. 

2. Preparation Assistance:- CRSPL assist you in preparing all necessary documents for the successful application. 

3. Application Submission:- CRSPL handles the entire application submission process by ensuring all the details are accurate and in proper manner on behalf of our client.

4. Follow-up Support:- CRSPL will proactively tracking the status of your application and also keeping you informed about the process with timely updates. 

5. Expert Consultants:- For any query related to business, you can meet business consultants at CRSPL, they are readily available to assist you.