Employee State Insurance is a good plan for employees to stay compliant while also protecting social security. It is mandatory for employers to register their employees under the ESI scheme if they meet certain criteria (such as salary threshold and the number of employees). The registered employees and their dependents are eligible for various benefits like medical treatment, cash benefits, and more.
Overview of ESI
ESI (Employee’s State Insurance) is a social security scheme in India for employees in the organised sector. It provides various benefits to employees in case of sickness, disability, and death due to employment injury. ESI registration is a process in which an employer registered their organisation and enrols their employees for ESI benefits. To register, the employer must have a minimum of 10 employees and their combined salary should be below a certain limit. The employer must apply for ESI and obtain a unique ESI number for the organisation. The employees then must also be enrolled by providing their personal details and proof of employment.
What Is Covered Under ESI Registration?
- Shops
- Restaurants or hotels
- Road Motor Transport Establishments
- Newspaper establishments
- Private Educational Institutions
- Cinemas
Documents Required
- Proof of business establishment (PAN card, GST registration certificate, Shop and Establishment Act certificate, etc.)
- List of employees with their personal details (Name, Age, Address, Salary, etc.)
- Bank account details of the organisation
- PAN card of the authorised signatory
- Cancelled cheque or bank statement of the organisation’s bank account
- Rent agreement or property ownership proof for the business establishment
- Declaration form signed by the employer and authorised signatory.
Importance
- Healthcare benefits: Employees registered under ESI are entitled to medical treatment and hospitalisation benefits.
- Cash benefits: In case of sickness, disability, or death due to employment injury, ESI provides cash benefits to employees and their dependents.
- Social security: ESI registration provides social security to employees and their dependents in case of contingencies.
- Compliance: ESI registration is mandatory for organisations employing 10 or more employees, and non-compliance can result in penalties and legal consequences.
- Employee welfare: ESI registration enhances the welfare of employees and helps in creating a positive work environment.
- Cost savings: ESI registration can help organisations save costs as a part of the contribution is borne by the government.
Overall, ESI registration is a critical aspect of HR management and helps in ensuring the well-being and security of employees
3 Registers to Keep for ESI Registration
- Form 6 is for employee registration
- Form 6 is for employee registration
- Inspection Book
Process of ESI Registration
The process of registering for Employee State Insurance (ESI) involves the following steps:
- Obtain ESI registration number: Apply for an ESI registration number at the nearest ESI Regional Office or Branch Office.
- Provide employee details: Provide the details of all employees who are to be covered under the ESI scheme, including their name, age, sex, occupation, salary, and other relevant information.
- Submit documents: Submit the required documents, such as identity proof, address proof, and salary slips of employees, to the ESI office.
- Payment of contributions: Pay the contributions for the employees and the employer, which are calculated based on the salary of employees.
- Issuance of ESI card: After completing the above steps, the ESI office will issue an ESI card for each employee, which can be used to avail of medical facilities under the ESI scheme.
- Ongoing compliance: Continuously pay the ESI contributions and update employee details as and when required to maintain ongoing compliance with the ESI scheme
FAQs on ESI Registration
What is ESI registration and why is it important?
ESI registration is the process of enrolling in the Employee State Insurance (ESI) scheme, which provides social security benefits to employees in the event of sickness, injury, or death. It is important because it offers financial security and medical benefits to employees and their families.
Who is eligible for ESI registration?
ESI registration is mandatory for establishments employing 10 or more people and paying a monthly wage of up to ₹21,000 per employee.
What documents are required for ESI registration?
The following documents are required for ESI registration: identity proof, address proof, and salary slips of employees.
How is the ESI contribution calculated?
The ESI contribution is calculated as a percentage of the employee's salary, with the employer contributing 4.75% and the employee contributing 1.75%.
What are the benefits of ESI registration?
The benefits of ESI registration include medical facilities, cash benefits for sick leave, maternity benefits, disability benefits, and funeral expenses in the event of death
Why Vakilsearch?
The ESI registration process requires expert advice and we at Vakilsearch are here to provide you with the expert assistance you need. Talk to our experts and get on a consultation call with our legal experts for 30 min. Our experts can do the documentation and the necessary procedure in the given timeframe.
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