ESI (Employee State Insurance) registration is a mandatory requirement under the Indian government’s ESI scheme, managed by the Employee State Insurance Corporation (ESIC). This autonomous body, operating under the Ministry of Labour and Employment, provides monetary, medical, and other benefits to employees through their employers.
Incorporation:
– Employers with establishments employing over 10 employees, with a minimum salary of Rs. 21,000, must register themselves with the ESIC.
– In some regions, ESI registration is required only if there are more than 20 employees.
Process:
– Eligibility for ESI registration in India is based on having more than 10 workers (or more than 20 in some regions).
– The employee’s gross salary should be up to Rs. 21,000 per month, and the establishment must be registered with the EPFO (Employees’ Provident Fund Organization).
– The total ESI contribution is 6.5% of the gross salary, divided between the employer (4.75%) and the employee (1.75%).
– Industrial units with potential health risks must ensure that all employees earning less than Rs. 21,000 per month are registered for ESI.
Documentation and Other Considerations:
To obtain ESI registration, employers need to submit the following documents:
– Registration Certificate of the Shops and Establishment Acts
– Factories Act
– Address proof of the principal place of business
– Copy of PAN Card
– Latest bank statement
– Memorandum and Articles of Association, partnership deed, or trust deed (depending on the nature of the entity)
– Certificate of Commencement registration number
– Monthly pay sheet for computing contribution amount
Definition of Factory and Establishment under ESI Act:
– A factory is any premise where ten or more persons are employed for wages, and a manufacturing process is being carried out, with or without power.
– An establishment is an organized body or institution employing 20 or more persons, engaged in economic activities leading to sale or purchase.
Benefits of ESI Registration:
– Employees covered under ESI registration can enjoy various benefits provided by the Employees State Insurance Corporation scheme.
By complying with ESI registration requirements, employers can ensure the welfare and protection of their employees, as well as access the benefits offered by the ESIC.