Overview of ESI Registration

There are various benefits for the employer and employee to have ESI Registration as some are hereinafter mentioned below:

 Medical Benefits

ESIC provides comprehensive medical benefits to insured employees and their dependents. This includes access to medical care, treatment, and hospitalization services. Employees and their family members can have medical facilities at ESIC dispensaries, hospitals, and tie-up hospitals.

Maternity Benefits

Female employees covered under ESIC are eligible for maternity benefits, which include paid leave during pregnancy, childbirth, and postnatal care. The benefits cover a period of up to 26 weeks, with an extended period in certain medical situations.

Sickness Benefits

Through the ESI registration, all employees have been offered different form of sickness benefits. All these benefits are offered at a rate of 70% of the total salary of the employer. This amount is provided in case the sickness extends over three consecutive months or 90 days.

Cash Benefits

ESIC offers cash benefits to insured employees during periods of temporary or permanent disablement due to employment injury. The cash benefits provided include sickness benefits, maternity benefits, and disablement benefits. These benefits help employees receive financial support during times of illness, maternity leave, or disability.

Dependent Benefits

In the unfortunate event of an insured employee's death due to an employment-related injury or occupational disease, ESIC offers dependent benefits to the family members. This includes a monthly payment to the dependents of the deceased employee.

Disability Benefits

ESIC provides financial assistance to insured employees in case of partial or permanent disablement caused by an employment-related injury or occupational disease. The benefits vary based on the extent of disability and can be availed in the form of monthly payments.

Funeral Expenses

ESIC also provides financial assistance for funeral expenses in case of the insured employee's death. This benefit helps the family members with the costs associated with the last rites and funeral.

Reduced Employer Liability

By registering under ESIC, employers fulfill their legal obligation to provide social security and healthcare benefits to their employees. It helps reduce the employer's liability for medical expenses and compensation in case of employee injuries or illnesses.

Improved Employee Morale

ESI registration and the availability of comprehensive medical and cash benefits enhance the overall employee morale and well-being. Employees feel secure knowing that they and their families are covered under a social security scheme.

The following documents are required:

• Required Registration certificate under the Shops and Establishments Act or the Factories Act as this document proves about the legality of establishment which is registered under the respective state law governing shops & establishments or factories.
• Memorandum and Articles of Association are required in case of a company. The copy of the Memorandum and Articles of Association outlines the company's structure and operating procedures.
• Certificate of incorporation is required in case of a company. A copy of the certificate of incorporation issued by the Registrar of Companies is required which shows the status of a company as a separate legal entity.
• The Permanent Account Number (PAN) card of the establishment as it is a unique identification number issued by the Income Tax Department. The copy of the PAN card for your establishment is required.
• Address proof of the establishment is required. It can be in the form of an electricity bill, telephone bill, rental agreement, or any other document which verifies the address.
• The comprehensive list of all the employees, including their names, addresses, and their respective salary details with other relevant information is required.
• The bank account details of the establishment, including the account number and IFSC code is also required.

The process which needs to follow for ESI Registration is as below:

Step 1: Login to ESIC Portal

• The employer requires himself to register on the ESIC portal.
• The employer can register by a simple click on the ‘Sign Up’ icon on the ESIC portal under the ‘Employer Login’-option appears on the home screen.
• The employers need to fill in all the details after clicking on the ‘Sign up’ icon, and submit the form.

Step 2: Confirmation Mail

• After submitting the form to the portal the employer will receive a confirmation mail to the registered mail ID & on the mobile number entered at the time of signing-up.
• For registering as an employer and employee within the ESI registration scheme the email will contain its username & password details.

Step 3: Employer Registration Form

• After that with the username and password received in the mail, log in to the ESIC portal. This will land on the page having an option with the ‘Tab - New Employer Registration’. Click on It.
• Then after from the drop-down list select the icon ‘Type of Unit’ and click on the ‘Submit’ button. The ‘Employer Registration – Form will be displayed. Next the employer requires filling in the details.
• The Employer Registration Form concedes details pertaining to the unit of the employer, details of the employer and employees. After completing all the details, the employer needs to click on the ‘Submit’ button, once; now the complete form is filled and submitted on behalf of the employer.

Step 4: Payment for Registration

• The ‘Payment of Advance Contribution’ page will be displayed after submission of the Employer Registration Form, where the employer is required to fill the amount that has to be paid. Now select the payment mode, by selecting the option the employer will need to pay the advance contribution for a time period of 6 months.

Step 5: Registration Letter

• The system will now generate the Registration Letter which is sent to the employer after the successful payment of 6 months advance contribution. Thereafter the 17 digit Registration Number will be generated by the ESIC department.
• The Registration Letter has now become a valid proof of ESI registration of the employer.

The ESI registration scheme is contributory in its nature. Both the employer and the employee are required to contribute at a specific rate. Though, these contribution shares are amended from time to time. The employee’s contribution rate is 1.75% of their salary and the employer’s contribution rate is 4.75% of the total salaries paid to its employees.

Employees who receive daily average wage upto Rs.100/- are exempted from payment of contribution. Employers will be required to contribute their own share in respect of these employees. An Employer is liable to pay the contribution in respect of every employee and deduct the amount from the employee's contribution part.

Returns filing

After the ESI registration, the employers must have to file ESI Returns on the half-yearly basis. The following documents are required for the returns filing:

• Register of attendance of all the employees.
• Form 6 – Register
• Register of wages
• Monthly returns and the challans.

Post Compliance

The establishment needs to comply with the following after having ESI registration:

• Maintenance of the attendance registers.
• Maintenance of a complete register of wages for workers
• Inspection book
• Monthly return and the challans within 15th of the month.
• Maintenance of a register that records any accidents that happened on the premises during the course of business.

Penalty on Non-Compliance

Consequence of Non Payment

Non-payments, delayed payments, or false payments under ESI Act can become liable for an imprisonment for a period may extend up to 2 years and also a fine of up to Rs 5,000.

Consequence of Delay Payment

An employer who fails to pay their contribution within the specified time limit mentioned in the regulation must be liable to pay interest at the rate of 12% p.a. in respect of each day of delay or default in payment of contribution.

Startupfino is one of the platforms that coordinate to fulfil the legal and financial requirements. We connect you with our consistent professionals. As we focus on simplifying legal requirements and providing regular updates we have become valuable for most of our clients. Our clients can also track at all times the progress on our platform. In case you have any inquiry about the ESI Registration process, our experienced representatives are just a phone call away. Startupfino will ensure that your communication with professionals is charming and seamless.