Employee State Insurance Corporation (ESIS): Benefits, Eligibility and Registration
The Government of India launched the Employees State Insurance Scheme (ESIS) in 1952 to ensure the safety of workers as per provisions of the Employees’ State Insurance Act, 1948. It provides coverage to workers against temporary/permanent disability owing to employment injury, sickness, physical disability, or any other medical condition that may affect an employee’s earning capacity.
To be a beneficiary of ESIS, both workers and employers must make contributions towards the scheme on a monthly basis.
Features and Benefits of Employees State Insurance Scheme
Here are some benefits offered by the Employees State Insurance Corporation (ESIC) under ESIS:
1. Medical
ESIS provides financial protection against medical expenses by offering access to affordable healthcare facilities. This coverage is effective from the first day of employment.
2. Maternity
The ESIC scheme for employees offers maternity benefits, which enables the insured to get 100% of the daily wages for a maximum of 26 weeks. This period can be extended depending upon medical advice. Also, note that one will be eligible for 6 weeks’ pay in case of a miscarriage, whereas the timeframe is 12 weeks for adoption.
3. Sickness
ESIS ensures an inflow of cash even during the period for which an employee is on medical leave. Insured individuals can get 70% of the daily wage for a timeframe not exceeding 91 days, in due course of two adjacent benefit periods.
4. Unemployment allowance
The Employee State Insurance Scheme provides a maximum of 50% of the average monthly wages for two years to the insured if they lose their job. Employees who suffer from permanent disability owing to any non-employment injury can also avail this benefit.
5. Dependent’s benefit
If a worker passes away owing to an occupational hazard, the insured individual’s dependent family members are eligible to get 90% of his/her salary. Dependent children can be eligible for this benefit from the age of 21. However, dependent parents and spouses will continue to receive monthly payments until death.
6. Funeral expenses
This insurance provides an amount of up to Rs. 15,000 to cover funeral expenses. This amount is received by dependents of the insured or the individual who performs the last rites.
7. Confinement expenses
If insured individuals get confined at a location where they don’t have any access to medical care, they, or their dependents, are eligible for confinement cost benefits.
8. Old-age healthcare
When individuals registered under the Employees State Insurance Scheme retire or resign owing to permanent disability, they or their spouses are entitled to receive old-age healthcare on the payment of Rs. 120 every year.
9. Physical rehabilitation
Insured individuals can avail this benefit, especially if they suffer from disability caused due to an employment injury.
Coverage under Employees’ State Insurance Scheme
As of March 31, 2019, ESIS was available in more than 30 states and union territories across India. Here’s a tabular representation of the beneficiaries under this social security scheme:
| Particulars | Coverage as of March 31, 2019 |
| Total beneficiaries | 13.32 crore |
| Total insured employees | 3.14 crore |
| Total insured women | 51.20 lakh |
| Total employers, etc. | 12.11 lakh |
| Total insured individuals/ family units | 3.49 crore |
Restrictions in relation to the coverage under ESIS:
- Individuals who are earning over Rs. 21,000 every month will not be eligible for the benefits of ESIS.
- For individuals with a disability, the maximum wage limit is Rs. 25,000 each month.
- Currently, the minimum number of employees required for an establishment to be covered under ESIC in Maharashtra and Chandigarh is 20 employees.
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Eligibility Criteria for ESIC
Here are the eligibility criteria to enjoy the benefits under the Employees’ State Insurance Scheme:
- As per Section 2(12) of the Employees State Insurance Act 1948, workers must be employed in a non-seasonal establishment with at least 10 employees to be eligible for ESIS.
- The monthly wages of an employee must not exceed Rs. 21,000.
In case employees are not able to fulfil the eligibility criteria of ESIS, they can opt for medical coverage offered by leading health insurance providers.
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Documents Required for the Registration of Employee State Insurance(ESI)
- Registration certificate of the business entity
- A list stating the names of all owners, directors and shareholders of the company
- A valid license/ registration certificate under the Factories Act or the Shops and Establishment Act
- PAN card, government-issued address proof of the business entity
- Register consisting of employees’ attendance details
- Bank account statements of the business entity along with proof of commencement of operations
- Bank account details of the business entity
- List of all employees along with details of their monthly compensation
When is ESI registration required
When a company or an entity employs 10 more employees earning less than Rs. 15,000 a month, ESI registration becomes mandatory. The employee would need to contribute 1.75% of his/her pay towards the ESI, while 4.75% will be contributed by the company he is employed with.
ESI Registration Process
To complete the ESI registration procedure, business entities need to follow these steps:
- Step 1: Sign up on the official ESIC portal by providing the necessary details, such as company name, region, etc.
- Step 2: Sign in to the portal by using the newly received login credentials.
- Step 3: Select ‘New Employer Registration’, and choose the unit type before clicking on submit.
- Step 4: Enter details regarding the unit, which include the unit’s address, the name of the establishment, and more.
- Step 5: Choose whether the establishment is owned/ hired and enter the nature of operations, PAN card details, etc.
- Step 6: Enter the license details (if applicable) and the date of commencement of the establishment.
- Step 7: Enter details of all owners and choose the constitution of ownership before clicking on ‘Save’.
- Step 8: Enter the names of all employees who earn less than Rs. 21,000 every month.
- Step 9: After moving on to the next page, enter the appointment dates of the first 10 or 20 employees before clicking on the ‘Employee Declaration Form’.
- Step 10: Choose Yes/No based on whether an insured individual is registered or not.
- Step 11: Enter the required details, including address, date of birth, marital status, etc. and click on submit.
- Step 12: After clicking on close, choose the Employees’ State Insurance branch office and applicable inspection division.
- Step 13: Select the checkbox to affirm that all information provided is correct before clicking on submit.
- Step 14: Pay via the payment gateway to complete the application procedure.
**Note that applicants will receive a Challan Number for future reference.
How to claim ESI Benefits?
One can claim two types of benefits under the ESI scheme
- Medical Benefits: You and your dependents can avail of medical care by visiting any of the ESI empanelled hospitals.
- Cash Benefits: Employees or workers who are beneficiaries of the ESI scheme can avail of cash benefits in the case of sickness, disablement (temporary/permanent), maternity, unemployment, dependent, funeral costs, and vocational and physical rehabilitation.
How to check the claim status of ESIC online?
Below are the steps to check the ESI claim status online:
- Step 1: Open the UMANG App
- Step 2: Enter the IP number or the ESIC Insurance Number and click on ‘Get OTP’.
- Step 3: Enter the OTP and click on ‘Submit’.
- Step 4: Select ‘Claim Status’ under the services menu.
- Step 5: If you have raised any claims, you will be able to view the status.
What is the ESI Pehchan card?
The ESI Card also known as Pehchan Card is an identification card to avail benefits of the ESI scheme at empanelled hospitals. The card includes the beneficiaries name, address, the insured person’s photograph and dependent details along with a unique ESI insurance number.
How to Download an ESI (Pehchan) Card?
Employees can follow these steps to apply for an ESI card:
- Step 1: Sign in to the ESI portal with your login credentials.
- Step 2: Click on ‘e-Pehchan card’ after navigating to the Employee section.
- Step 3: Click on ‘view’ after choosing the unit details.
- Step 4: Enter the name and insurance number of the respective employees to view their details.
- Step 5: Choose the ‘View Counter Foil’ option against any particular employee; note that this ‘Counter Foil’ is the ESI Pehchan card.
- Step 6: One can download it as a PDF document after clicking on ‘Print’.
After taking a printout, employees need to sign and affix photographs of dependents. Additionally, they must make sure to get their photo attested by an ESI official or their employer.
Things to keep in mind while opting for ESI scheme
An employee covered by ESI benefits can opt-out of ESIC after submitting documentary proof of having got himself covered under the medical insurance. Once the employee exercises this option, the employee shall be deemed to have exited from the ESIC deductions.
Do’s and Don’ts of Employees’ State Insurance Scheme
Here are certain things that employees need to keep in mind regarding the Employees State Insurance Corporation Scheme:
- Adhere to doctors’ instructions.
- Make sure to protect the ESI card from theft or damage.
- If the Pehchan card gets misplaced, individuals must make sure to report it to the Dispensary or Branch office as soon as possible.
- In case employees who already have an ESI Registration Number join a new company, they must inform their new employer regarding the same.
- Workers must make sure that their employer signs Form 105 before heading out on an outstation journey.
- One should take referral procedures seriously.
Redressal of Public Grievances & List of Toll-Free Numbers
- Toll-Free/Help Desk Number: 1800-11-2526
- Medical Helpline: 1800-11-3839
- E-Mail Address- For Grievances/Suggestions: [email protected]
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Final Word
The Employees State Insurance Scheme comes with a wide range of benefits. Individuals must be fully aware of them to make the most of the benefits. Also, it is essential that they keep all the necessary documents handy to avoid any hassle during the application procedure.
FAQs
Ans: Yes, for organizations that fulfil the eligibility criteria of ESIS, it is compulsory to register themselves with ESIC. Also, the registration process has to be completed within 15 days once the business entities receive approval for the same.
Ans: Business entities need to complete the payment of contributions in 21 days from the last day of the previous month.
Ans: If individuals fail to complete the payment of contributions within the specified time limit, they need to pay 12% interest p.a. for each day they have defaulted on their payment.
Ans: No, any payment of benefits under this act is not transferable.
Ans: The time limit is 21 days from the last date of the month.
Ans: Apart from the worker’s income records, employers must also maintain an inspection book, employee’s attendance register and accident register.
Ans: Below are the types of establishments that can avail of the ESI scheme:
Hotels or restaurants that are engaged in sales
Shops
Cinemas or theatres
Newspaper establishments
Road transport establishment
Private educational institutions.
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Disclaimer: This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
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