ESI Registration Applicability
ESIC and its applicability
Employees’ State Insurance Corporation (“ESIC”) is a statutory corporate body set up under the ESI Act 1948, which is responsible for the administration of the ESI Scheme.
The ESI scheme is a self-financed comprehensive social security scheme devised to protect the employees covered under the scheme against financial distress arising out of events of sickness, disablement or death due to employment injuries.
The ESIC has its headquarters in New Delhi besides 23 regional offices, 26 sub-regional offices in the states and over 800 local offices throughout the country to support the implementation of the ESI scheme. In addition, the Medical Benefit Council, a specialized body that advises the ESIC on the administration of Medical benefit is functioning.
Composition of ESIC
The ESIC generally consists of the following members as explained below:
Applicability of the ESI Scheme
The ESI scheme is applicable to all factories and other establishments as defined in the Act with 10 or more persons employed in such establishment and the beneficiaries’ monthly wage does not exceed Rs 21,000 are covered under the scheme.
Whether the employer has employed 10 or more employees, all employees employed by the employer, agnostic of the salary are reckoned. The applicability of the scheme is explained through a flow chart below:
Note: The scheme under the act also supports restaurants, motor road transports, newspaper establishments and undertakings, movies and purview theatres, hotels, shops. The threshold for coverage of establishment is 20 employees in Maharashtra.
Features of the ESI Scheme
ESIC Registration Eligibility
Any non-seasonal factory or establishment having more than 10 employees (in some states it is 20 employees) who have a maximum salary of Rs. 21,000/- has to mandatorily register itself with the ESIC within 15 days from the date of its applicability.
Under this scheme, the employer needs to contribute an amount of 3.25% of the total monthly salary payable to the employee whereas the employee needs to contribute only 0.75% of his monthly salary every month of the year. The only exemption to the employee in paying his contribution is whose salary is less than Rs. 176/- per day.
Created & Posted By Piyush Sharma
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