How To Register For ESI?

Whenever 10 or more workers (20 in some states) are employed and have a very low salary, E.S.I. registration becomes compulsory for such employers. The E.S.I. scheme provides financial and medical benefits to employees for sickness, maternity, and disability or injury during work.

Online ESI registration equips an organization with legal insight into the relevance of offering these social security benefits to employees. It involves submitting the ESI documents via the ESIC portal, hence the registration is easy, simple, and less time-consuming.

Establishment Meaning As Per The ESI Act

The Employees' State Insurance Act, 1948 (ESI Act) defines an establishment as any premises (or its surrounding areas) where ten or more employees are employed for wages.

This Applies Not Only To Factories But Also Includes:

• Hotels, restaurants, and boarding houses
• Cinemas, theatres, and places of public entertainment
• Shops, commercial enterprises, and business establishments
• Educational institutions
• Medical facilities
• Transport services
• Warehousing operations

Important aspects of the definition of an establishment under the ESI Act include:

• The premises must be used for economic activities.
• At least ten employees must be working for wages.
• Employees should have worked on the premises for a minimum of 240 days in the previous 12 months.

Premises that meet these requirements are considered an establishment under the ESI Act. The Act also allows the Central or State Government to extend coverage to establishments with fewer than ten employees through a notification in the Official Gazette.

Advantages Of ESI Registration

• Medical Benefits: Employees can access comprehensive medical care, including hospitalization, surgeries, and outpatient treatments.
• Sickness Benefits: Registered employees receive financial support during periods of medical leave due to illness, ensuring income stability.
• Maternity Benefits: Female employees are entitled to maternity leave and benefits, providing support during and after childbirth.
• Disability Benefits: Employees who suffer from work-related injuries or disabilities can receive compensation, helping them manage their financial needs.
• Pension Benefits: The ESI scheme offers pension benefits to insured employees and their dependents after retirement or in the event of the insured person's demise.
• Family Benefits: Dependents of insured employees can access medical benefits and financial assistance, ensuring the family's welfare.
• Rehabilitation Benefits: The scheme provides rehabilitation services for employees recovering from work-related injuries, aiding their return to work.
• Job Security: ESI registration fosters a sense of job security among employees, knowing they have access to essential health and financial support.
• Legal Compliance: ESI registration helps employers comply with legal requirements, reducing the risk of penalties and legal issues.
• Improved Employee Morale: Providing ESI benefits enhances employee satisfaction and morale, contributing to a positive workplace environment.

Steps For Online ESI Registration

1. Visit the Official Website: Navigate to the Employee State Insurance Corporation (ESIC) official website.
2. Create an Account: Click on the registration option to create an account. You’ll need to provide basic details like your name, email address, and mobile number.
3. Login: Once registered, log in using your credentials.
4. Fill in the Application Form: Complete the online application form for ESI registration, providing necessary details such as:
5. • Name of the establishment
   • Address and contact information
   • Type of business and number of employees
   • Nature of activities
5. Upload Required Documents: Attach all necessary documents, including:
6. • Proof of establishment (e.g., business registration certificate)
   • Employee details (wage sheets, attendance records)
   • PAN and GST registration, if applicable
6. Review Application: Check all entered information and documents for accuracy.
7. Submit Application: Once everything is confirmed, submit your application.
8. Receive Acknowledgment: After submission, you will receive an acknowledgment receipt containing a unique reference number.
9. Verification by ESIC: The ESIC will review your application and documents. If approved, they will provide an ESI registration number.
10. Receive ESI Registration Certificate: After successful verification, you will receive the ESI registration certificate, allowing you to comply with ESI regulations.

By following these steps, you can efficiently complete the online ESI registration process.

Entities Included Under ESI Registration In India

• Factories: All manufacturing units that employ ten or more workers.
• Shops: Commercial establishments, including retail shops, restaurants, and hotels, with the required number of employees.
• Educational Institutions: Schools, colleges, and universities that meet the employee threshold.
• Medical Institutions: Hospitals, clinics, and other healthcare facilities that employ staff.
• Transport Services: Businesses involved in transportation that have ten or more employees.
• Construction Sites: Projects where ten or more workers are engaged in construction activities.
• Warehousing Services: Facilities that store goods and employ the necessary workforce.
• Entertainment Venues: Cinemas, theatres, and places of public amusement with the required number of employees.
• Any Other Establishment: Any other type of establishment that meets the criteria set by the ESI Act.

Eligibility Criteria For ESI Registration In India

1. Employee Count: The establishment must employ ten or more workers on a regular basis.
2. Economic Activity: The business must engage in a lawful economic activity, including manufacturing, services, or trading.
3. Wage Threshold: Employees must earn wages below a specified ceiling limit set by the government (currently ₹21,000 per month for most employees and ₹25,000 for persons with disabilities).
4. Type of Establishment: The establishment must fall under the categories specified in the ESI Act, such as factories, shops, and educational institutions.
5. Location: The establishment must be situated in an area covered by the Employees' State Insurance Corporation (ESIC).
6. Compliance with ESI Regulations: The establishment must comply with the provisions of the ESI Act and maintain necessary records for employee contributions.

Contribution Rates For ESI

Contribution rates under the Employees' State Insurance (ESI) scheme comprise two distinct components, namely, employee and employer contributions. Under this scheme, every employee contributes 1.75% of their wages to the ESI fund, while an employer contributes 4.75% of such wages. This results in a total combined contribution of 6.5% of the age rates of the employee.

One must note, however, that contributions are subject to wages up to a stipulated limit, which at present is ₹21,000 per month for nearly all employees and ₹25,000 for PwDs. The contributions made under this Act empower the employees to different types of benefits in terms of medical care, maternity benefits, and so on other types of social security provisions.

Documents Needed For Online ESI Registration

• Employer Identification: PAN (Permanent Account Number) of the establishment is required.
• Business Details: A certificate of incorporation or registration must be submitted.
• Employee Information: A list of employees with their details, including name and salary, is necessary.
• Establishment Address: Proof of business address, such as a utility bill or lease agreement, is needed.
• Bank Details: Bank account information for contributions must be provided.
• Affidavit: An affidavit declaring the nature of the establishment and compliance with the ESI Act is required.
• Other Supporting Documents: Any additional documents specified by the state ESI office should be included.

Compliance Requirements Following ESI Registration

Employers have to fulfill certain compliance requirements after obtaining ESI registration. They must calculate and remit ESI contributions for their employees on a monthly basis, while also filing ESI returns as prescribed from time to time, usually monthly or quarterly. Moreover, accurate records of employees insured under ESI including their wages and contributions must be maintained.

ESI-related information should be displayed at workplace premises, and the employer must adhere to all rules and regulations of the ESI Corporation. Moreover, educating employees on their entitlement provisions and benefits under the scheme is also critical. Up-to-date registration details must be maintained and renewed as necessary, and employees must be informed about how they can access their ESI benefits, such as medical care and sickness benefits.

Period Of Contribution

The period of contribution is defined as the period during which an employee is liable for ESI (Employees' State Insurance) contributions over wages. This period is important for ascertaining an employee's standing for certain benefits under the E.S.I. scheme, such as medical treatment, sickness benefits, and maternity benefits. Contribution is done monthly based on an employee’s wages, and the period of contribution is expressed in completed months of employment.

To be in good standing, employees must keep up their contributions with regularity and within the time limits of the E.S.I. Corporation. Before long, a defect in the required period of contribution would find an employee devoid of the benefits.

Returns To Be Submitted Following ESI Registration

After ESI registration, returns must be filed biannually. The following documents are required for this process:

• Employee attendance register
• Form 6 Register
• Wages register
• Accidents register (for any incidents that occurred on the premises)
• Monthly returns and challans.

Conclusion

ESI registration holds utmost significance for eligible establishments operating in India so that workers may receive their basic social security benefits. Therefore, with the Employees' State Insurance Act of 1948, not only are employers fulfilling their statutory requirements, but they are also assisting in the health and welfare of their workforce. The new online procedure for ESI registration has simplified compliance, thus making it more attainable as well as convenient for businesses.

FAQs On ESI Registration

A few FAQs are:

Q1. What is ESI registration?

ESI registration is the process through which employers and employees register for the Employees' State Insurance (ESI) scheme, providing health insurance and social security benefits to employees.

Q2. Who is required to register for ESI?

Employers with ten or more employees earning below a specified wage limit must register for ESI.

Q3. What are the benefits of ESI registration?

ESI registration provides employees with benefits such as medical care, maternity benefits, disability benefits, and pensions.

Q4. How can I register for ESI online?

You can register for ESI online through the official ESI Corporation website or seek assistance from service providers.

Q5. What documents are required for ESI registration?

Common documents required include the employee attendance register, wages register, and proof of establishment.