ESIC Registration for Business
ESIC Registration for Business
The Employees’ State Insurance Corporation or ESIC is an Indian social security organization providing cash and medical benefits to the workers of the organized sector of India. It is a statutory responsibility for the employers or businesses to register their business under the ESIC within 15 days from the date of its applicability to them. ESIC Registration is the process by which every employer and its employees are identified and registered under the scheme. In this article, we look at ESIC Registration and its applicability to employers.
Businesses that employ 10 or more persons, drawing wages of up to Rs.15,000/- a month, are required to be registered for ESIC under the ESI Act, 1948. As of today, expect for Manipur, Sikkim, Arunachal Pradesh, and Mizoram, all other States and Union Territories in India are required to comply under the ESI Act, 1948. As on 31.3.2013, nearly 6.66 lakh employers are registered with the ESIC, extending ESIC benefit coverage for over 1.65 crore employees. To get your business’ ESIC Registration, visit IndiaFilings.com
ESI Scheme is a self-financing health insurance scheme. Therefore, the benefits provided by the scheme are funded from the contributions that are raised from covered employees and their employers as a fixed percentage of wages. As of now, covered employees contribute 1.75% of the wages to the ESIC, and covered employers contribute 4.75% of the wages, payable to their employees. Employees earning up to Rs.100/- a day need not pay their share of contribution. Employers are liable to pay the total ESIC contribution (employer portion and employee portion) in respect of every employee. Deductions must be made from the employees’ wages bill at the rate prescribed, and the same should be deposited with the ESIC within 21 days of the last day of the Calendar month in which the contributions fall due. ESIC has designated branches of the State Bank of India and some other banks to receive the ESIC contribution deposits.
ESIC Benefits for Employees
Employees registered with the ESIC can avail of a range of medical and sickness benefits under the scheme. The following six are the major areas of benefits provided under the ESIC Scheme:
Medical Benefit: The ESIC Registration benefits the employees and their family members from the day with full medical care. There is no ceiling on expenditure on the treatment of an insured person or his/her family member. It also benefits medical care to retired and permanently disabled insured persons and their spouses on payment of a token annual premium of Rs.120/-.
Sickness Benefit: Sickness benefit at the rate of 70 percent of wages is payable to employees registered under the ESIC scheme for the periods of certified sickness for a maximum of 91 days in a year. In order to qualify for sickness benefit, the employee under ESIC must contribute for 78 days in a contribution period of 6 months. Enhanced and extended sickness benefits are also available for certain employees under the scheme, who qualify for certain criteria.
Maternity Benefit: Maternity benefit for confinement/pregnancy is payable for three months, which is extendable by further one month on medical advice at the rate of full wage subject to contribution for 70 days in the preceding year.
Disablement Benefit: Temporary disablement benefit is payable to ESIC covered employees at the rate of 90% of wages as long as the disability continues. Permanent disablement benefit (PDB) is payable at the rate of 90% of wages in the form of monthly payment depending upon the extent of loss of earning capacity, as certified by a Medical Board.
Dependents’ Benefit: Dependents’ benefits are paid at the rate of 90% of wages in the form of monthly payment to the dependants of a deceased person covered under the ESIC scheme in cases where death occurs due to employment injury or occupational hazards.
Other Benefits: In addition to the above comprehensive medical, sickness, maternity, and disablement benefits, employees registered under the ESIC scheme are also eligible for other benefits such as funeral expenses compensation, vocational rehabilitation, physical rehabilitation, old-age medical care, etc., Considering the above benefits for employees and the statutory responsibility of the Employers to be registered under the scheme, it is recommended that all businesses that are required to have ESIC Registration to be registered under the scheme at the earliest.