ESI Registration is a significant aspect of social security and legal compliance for any Indian business. It not only saves the employees through health, maternity, disability, and other benefits but also saves the employers from legal maladies and penalties. It ensures a healthier and safer workforce while being in tandem with the provisions of the Employees' State Insurance Act, of 1948.
Registration with ESI is mandatory for business houses falling under the Employees' State Insurance Scheme governed by the ESIC Act. It offers social security, that is, medical benefits and monetary protection in case of sickness, injury, or confinement. It is a government scheme governed by the Employees State Insurance Corporation and falls within the jurisdiction of all the units having 10 or more employees including factories, shops, hotels, cinemas, and private educational institutions.
The online ESI registration process is easy and can be completed through the ESIC website or the Shram Suvidha Portal. While doing so, the employer must provide crucial documents, such as the PAN card of the company, registration certificate, certificate of incorporation, address proof, utility bills, a canceled cheque, and a partnership deed if necessary. While registering, he has to furnish information related to employees, including their mobile number and email ID.
After registration, the employer will receive a unique 17-digit ESI code, which will be used for all future compliance, such as making monthly contributions and tracking payments.
Employers are mandatorily required to deposit ESI contributions on their employees' monthly wages at the rate determined by the ESIC. Such contributions are made payable to the organization's identified bank account. The scheme in this manner can reach the benefits to insured workers. The employers have to maintain and submit attendance registers of all workers with the ESIC besides submitting the ESI returns within time. Failure to comply with these requirements may lead to penalties under the Factories Act and other government regulations.
The ESI scheme for workers provides medical benefits through ESIC hospitals and approved medical institutions. It also offers health insurance to the employee and his family member including maternity leave and compensation owing to employment-related injuries. Additionally, it provides cash benefits to the employees in terms of sickness or disability. ESI registration is important to businesses as it provides legal compliance, avoidance of fines, and a healthy, safe workplace. This scheme builds the strength of workplace safety in conformity with Indian laws and creates a healthy work environment.
According to the ESI Act of 1948, ESI Registration is compulsorily required for all factories, establishments, and certain businesses having more than 10 employees (or 20 in some states).
Registration is required for those businesses registered under the Employee State Insurance Corporation (ESIC). Employees with a monthly salary up to ₹21,000 per month or ₹25,000 for employees with disabilities are eligible for the scheme. As part of the registration process, employers have to pay a percentage of the employee's monthly wages into the ESI scheme.
Both employers and employees pay into the scheme, but the share is higher for the employer. Besides that, the employers are also required to provide all the necessary documents, such as the PAN card, list of employees, and company registration documents, in the process.The ESI Registration is done at the ESIC portal. After being registered, the employers are issued a unique 17-digit number. Employers who already exist use their Employer Login to maintain the contributions and avoid non-compliance.
Employees and their families are offered full medical serviceshospitalization, outpatient treatment, specialty consultations, and preventive services. There is quality health care without such costs.
The ESI scheme offers financial protection against the adverse impact of disease, injury, and death. It offers long-term security of finances for employees and their dependents.
Female employees are allowed to receive leave during pregnancy, confinement, and postnatal care. That is cash allowance and medical care allowances that support her financially, at such a critical point.
Disability benefits are awarded to an employee who is injured or ill due to the workplace. It is either temporary or permanent, depending on the nature of the condition. In case of death resulting from a work-related injury, there are dependent benefits for their care.
In the event of an unfortunate employee death, the ESI scheme pays a lump sum amount for meeting funeral expenses. It helps the family at that trying time.
Companies that have over 10 workers or, in some states, more than 20 workers and whose employees have an earning not exceeding ₹21,000 per month or ₹25,000 if disabled workers are also supposed to register themselves for ESI. More so, there are certain guidelines given by the Indian government and by state authorities. Companies need to comply with all those regulations as well. The ESI Act covers non-seasonal factories and establishments with 10 or more employees in most states, and 20 in others. These include industries such as factories, shops, cinemas, hotels, and private educational institutions. These employers need to register for ESI and be eligible for both the business and the employees.
Minimum Requirements for Obtaining an ESI Card
Any suitable establishment can provide suitable ESI card schemes, provided their monthly remuneration is below ₹21,000. Some percentage of employees' salary will have to be contributed to the ESI scheme, and through that, they will get medical benefits, maternity benefits, disability benefits, and many more. Once an employee registers himself, then he/she receives an ESI card that helps him access his benefits from ESI.
Eligibility for Employers
Employers must register for ESI if they have more than 10 workers (or 20 in some states), and the employees earn up to ₹21,000 a month, or ₹25,000 if they are disabled. The employer contributes 3.25% of the employee's wages, while the employee contributes 0.75%. Penalties apply if employers fail to comply.
Eligibility for Employees
Employees earning up to ₹21,000 per month, or ₹25,000 if they have disabilities, are eligible for ESI. This scheme provides medical, sickness, and disability benefits by deducting a small percentage from the employee's wages.
Employee State Insurance Act of 1948
The Government of India passed the Employees' State Insurance Act in 1948 to provide social security to workers. This Act provides health and financial benefits to an employee and his family at the time of sickness, disability, maternity, or on the occurrence of employment-linked injury. Registration of employees with the ESI scheme saves employers from the consequences of that Act.
The ESI Act provides the following benefits to employees:
Sickness Benefits
Disability Benefits
Maternity Benefits
Dependent Benefits
Occupational Disease Coverage
The cost of ESI Registration depends on the size of the business and the services that one opts for. In general, the professional charge for registration is about Rs.1,950, while the cost of getting a DSC would be around Rs. 2,400. Complete registration packages would start from Rs.5,999 based on the scale of the business.For organizations that have a strength between 101 to 300, the registration fee is around Rs. 750. A registration fee of Rs. 1000 for organizations that have 301 to 500 employees. Some categories are subject to reduced fees like SC/ST/PWD/Ex-Servicemen, which is ₹250 or ₹500 in some cases.
Organizations making the ESI payments late or failing to register face penalties in terms of:
5% penalty per annum
10% penalty per annum
15% penalty per annum
25% penalty per annum
These penalties and other expenses help companies avoid paying them due to timely payments.
To file the registration under ESI, businesses must produce the following documents:
Certificate of Registration of Business.
Employee details (names, contact info, Aadhaar cards).
PAN card of the business.
Address proof (lease agreement or utility bill).
Bank account information (bank statements or canceled cheques).
Employee salary details.
Nomination form for employee benefits.
For a smooth experience and professional assistance with ESIC registration, rely on Credible Corporate Services. Our team ensures smooth registration, document management, and compliance.
Contact us today for professional support!
Call / WhatsApp
Visit the ESIC Portal
Go to the official ESIC website and create an account.
Fill Out the Registration Form
Provide business details such as name, address, and type of organization.
Upload Documents
Submit the required documents during the registration process.
Review Information
Verify all entered details to ensure accuracy.
Submit Form
After verifying the information, submit the form for processing.
Receive Registration Number
Upon approval, receive a unique 17-digit ESI registration number.
Issue ESI Cards to Employees
Supply employees with their ESI cards to make use of the benefits.
After registration in ESI, a business entity has to follow certain post-registration compliances. These include maintenance of attendance and wage registers, filing of monthly returns within the 15th of every month, and on-time contributions.
Regulatory Filing Requirements
The employer is expected to upload contributions of employees through the ESIC portal for every month strictly in the contribution period, or else timely contribution will deprive the benefits for employees with a fine.ESI Registration is important to both the employer and employee. This helps protect the employees with India's social security system while keeping businesses on the right side of the government's books. By following the correct registration process and maintaining compliance, businesses can avoid penalties and provide their employees with the benefits of the ESI scheme.
At Credible Corporate Services, we know how complicated the ESI Registration process can be and, thus, help Indian businesses with professional support. Whether it's a small business or an MNC, our team will help you through the complete registration process and ensure your business is up to the mark in terms of compliance with laws and regulations. We have efficient, seamless services tailored to your needs so you can tend to your business while we address ESI compliance -related matters.