In the following article, we are going to give you full information on
ESIC. Here, we are talking about ESIC registration. So, if you are in any confusion between EPF & ESIC, then all your confusion is going to end with the closure of this informational segment. For EPF related information, you can click here. Therefore, taking an initiation we are beginning this with clarifying the
population’s confusion…

Difference Between ESIC & EPF

EPF	ESIC
Focused on post Retirement Income and Benefits	ESI scheme is a healthcare
Employees complete 12% goes to PF account while employer contributions' 8.33% goes to Pension Fund and 3.67% goes to PF Fund	It is deducted on a gross salary which is 1.75% from the employee contribution & 4.75% from the employer contribution.

There is a big significant similarity between the two is that- At present, registrations under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (EPF Act) and the Employees’ State Insurance Act, 1948 (ESI Act). These are mandatory for companies, which are employing more than 20 and 10 employees, respectively.

The detailed discussion of EPF has been discussed in our earlier articles the link is here for ready reference:

You may also like- EPF Registration Guide

An Introduction to ESIC

ESI stands for Employees’ State Insurance. This scheme is administered by the Employees’ State Insurance Corporation, under the Labor Ministry. As per the ESI Act 1948, workers with a salary of up to Rs 21,000; are under the Labor Ministry. This wage ceiling was increased from 15,000 to 21, 000 in December 2016 by the Government. In order to increase the formal workforce of the Nation. With the move by the government to raise the wage coverage limit under the scheme, ESIC Registration under the scheme has increased. 

The ESI Act provides provision of the following-

• Maternity
• Cash
• Medical
• Disability
• Dependent Perks

Figures of Coverage by ESIC

• Begin with the two industrial centers in Kanpur and Delhi (1952)
• At present, it is now running at over 843 centers in 33 States & Union Territories
• The scheme has reached more than 7.83 lakhs across the country, benefiting approximately 2.13 crores of persons/family units
• The cumulative beneficiary is now more than 8.28 crores

Contribution Rates- Previous to Current for ESI

Data from the Labor Ministry indicates that in 2018-2019, Rs 22,279 crore was contributed by 36 million employees below the scheme. In line with the Employees ' State Insurance (ESI) Act, the government has cut the contribution down from 6.5% to 4%. This step is likely to raise the wage of workers at home and decrease employers ' economic burden. 36 million workers and 1,28 million employers will benefit from the decision.

Advantages of ESI

 

 

 

 

 

 

 

 

 

 

Medical Benefits: 

This offers reasonable medical insurance for a beneficiary’s medical expenses. The policy gets applicable from the first day of work.

Disability Benefit: 

When an employee has insurance, ESIC Registration shall ensure, for temporary disability or for the duration of a permanent disability, that the employee is paid his monthly wages.

Maternity Benefit: 

ESIC supports an employee in bringing their baby into the family with benefits. For a period of up to 26 weeks from the date of having the baby and six weeks in the event of a miscarriage. ESIC gives a total of 100% of the average daily wages. In the case of adoption, 12 weeks ' compensation shall be granted.

Sickness Benefit: 

ESIC guarantees a cash flow to the household of an employee during the medical leave. For a maximum period of 91 days during two continuous benefit periods. 70% of an employee's average daily wages are paid during medical leave.

Unemployment Allowance: 

In the case of permanent invalidity triggered by a non-employment accident or involuntary job losses. ESI offers a monthly cash payment for a duration of no longer than 24 months.

Dependent's Benefit: 

In the case of premature death from injury at the job site, ESIC Registration will provide monthly payments to the remaining dependents.

You can also avail the following benefits:

• Professional Training
• Funeral Costs
• Physical Rehabilitation
• Containment Expenses
• Skill up-gradation Training under Rajiv Gandhi Shamika Kalyan Yojana

Eligibility for ESI

• This scheme is applicable for all factories and other infrastructure under the Act with 10 or more staff in that unit and their monthly beneficiaries do not surpass Rs 21, 000.
• Whether the employer employs 10 or more employees, the agnostic wage is for everyone employed by the company.

Checklist for ESI Registration

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By Megha Saxena

Content Production & Social media Manager

Tax Advisory