Process of Registration under Employees State Insurance Act 1948: ESIC Scheme Salary Limit, Benefits, Coverage & Contribution

By | June 28, 2014

What’s the Process of Registration under Employees State Insurance Act 1948 and Salary Limit, Benefits, Coverage & Contribution under ESIC.  Employees’ State Insurance Act, 1948 (ESI Act) was enacted for the benefits of employees working in factories. Registration is required for both employees and employer & Family members for ESIC Benefits. The Employees’ State Insurance Scheme is administered by a Corporate body called the Employees’ State Insurance Corporation (ESIC). This social security scheme was introduced to cover medical needs and loss of wages during contingencies such as temporary or permanent physical disablement, injury or death due to or during employment.  ESIC Act guarantees medical care to workers and their immediate dependents or we can say its an health insurance jointly financed by government employer and employees which covers workers and their dependents during medical emergency. ESIC has more than 1,560 clinics and hospitals that the Employees’ State Insurance Corporation (ESIC) runs directly or has a tie-up with 1,678 empanelled private medical practitioners and 42 Hospital. Every month, eligible employees contribute 1.75% of their salary and employers contribute 4.75% to the ESI corpus.

Applicability or Coverage of Establishment & Factories under ESIC

The ESI Act, 1948 applies to following categories of factories and establishments in the implemented areas:

  • Non-seasonal factories using power and employing ten (10) or more persons
  • Non-seasonal and non power using factories and establishments employing twenty (20) or more persons
  • In Addition to two categories Government have extended the ESI Act to certain specific class of establishments, such as, shops, hotels, restaurants, cinemas, preview theatres, motors transport undertakings and newspaper establishments etc., employing 20 or more persons.( Section 1(15) ESIC Act)

Employee Coverage or Eligible Employees for ESIC Scheme benefits

The Scheme protects all “employees” engaged on a monthly remuneration not exceeding Rs. 25000/- (Before September 2013 Limit was Rs 15000 and before May 2010 Limit was Rs 10,000/-)  this  in a factory/ establishment to which the Act applies. Persons employed for wages on any work connected with the administration of the factory or establishment or any part, department or branch There of or purchase of raw materials, or distribution or sale of the product of a factory or establishment are also covered. Mines, Railway Running Sheds, Naval, Military and Air Force Workshops and specified seasonal factories are excluded. The scheme also provides full medical cover to the dependants of insured persons. In the event of death of an insured person due to employment injury dependents become eligible to cash benefit.

Benefits to Employees .i.e Disease Covered under ESI Act

The section 46 of the Act envisages following six social security benefits :-

(a) Medical Benefit

(b) Sickness Benefit(SB) which covers Extended sickness Benefit(ESB), Enhanced Sickness Benefit

(c) Maternity Benefit(MB)

(d) Disablement Benefit which covers  Temporary disablement benefit(TDB), Permanent disablement benefit (PDB)

(e) Dependants’ Benefit(DB)

(f) Funeral Expenses

An interesting feature of the ESI Scheme is that the contributions are related to the paying capacity as a fixed percentage of the workers wages, whereas, they are provided social security benefits according to individual needs without distinction.

Cash Benefits are disbursed by the Corporation through its Local Offices LOs/ Mini Local Offices (MLOs)/Sub Local Offices SLOs)/pay offices, subject to certain contributory conditions.

In addition, the scheme also provides some other need based benefits to insured workers.

These includes :

i. Rehabilitation allowance
ii. Vocational Rehabilitation
iii. Unemployment Allowance (Under Rajiv Gandhi Shramik Kalyan Yojana)

Procedure for Employee Registration of under ESIC 

Step 1. : Check the Employees Eligibility for ESI Registration

All those persons employed for wages drawing an amount within the wage ceiling of Rs 25,000/- are eligible for ESI Registration. This Limit has implement in October 2013 before that limit was Rs 15,000 till May 2010 and before that limit was Rs 10,000/-

Step 2. : Forms for Registration 

In respect of each of such employees a declaration (Form 1), duly filled in & signed by the employee concerned and duly countersigned by the authorized signatory of the employer is to be forwarded to the appropriate Branch Office within 10 days of employment along with two copies of family photo.

Step 3: ESI Number Allotment 

Appropriate Branch Office shall allot Insurance Numbers, which are specific in favour of the individual employee, (Male & Female employees will get separate series of Insurance Numbers) and forward to the employer, along with the Identity Card / Temporary Identity Card, Return of declaration forms etc. At the same time the office will also forward the Medical Record envelops of such Insured Persons to the respective dispensaries.

Step. 4: ESI Card Distribution 

Distribute the Identity cards to individual, employees under due acknowledgement. It should be ensured that each employee signs on the card in the presence of the employer before issue of the card.

Procedure for Employer Registration of under ESIC 

Step 1 : Applicabilty of ESIC for Registration of Factories/ Employer

First check whether your factory / establishment is situated within the area of implementation by ESIC (Implemented area). Then you must contact you ESIC regional officer for registration of factories or you can also contact ESIC Consultant for registration of factories under ESIC Act.

Step 2. Forms Required for Registration of Employer

It is statutory responsibility of the employer to get his factory registered under the ESI as per Section 2A of the Act, read with Regulation 10B within 15 days of establishing or 15 days after the Act becomes applicable to the area in which the factory is situated. A declaration of registration in Form 01 (Employer’s Registration form) is to be submitted to the appropriate office (Regional Office, ESI Corporation,Chennai in your case) for the purpose.

Step 3. : Allotment of ESIC Code of Employer

The Sub Regional Office will allot a specific code number in Form C-11, after examining the aspect of coverage. This number so allotted is very specific for the employer and the same has to be used in all correspondence with ESIC. The area Branch Office to which the particular employer attached is the “Appropriate Office” for “Registration of Employees”. List of Branch Offices and Dispensaries under the Coimbatore Sub Region is furnished in a separate Booklet.

DOWNLOAD FORMS FOR ESIC REGISTRATION

FORM NO.SUBJECTRELEVANT REGULATIONTO BE USED BY
FORM-01Employer’s Registration Form10 BEmployer
FORM-01(A)Form of annual information on factory/establishment covered under ESI Act10 CEmployer
FORM-1Declaration Form11 & 12Employer
FORM-1(A)Family Declaration Form15-AEmployer
FORM-2Addition/Deletion in Family Declaration Form15-BEmployer

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