ESIC stands for ‘Employees State Insurance Corporation’. The scheme provides monetary and medical benefits to Employees in a case of sickness, maternity, and employment injury and to make provisions for related matters. ESIC registration is a statutory responsibility of the employers of factory or any establishment under the Act.
Are you required to Obtain ESIC Registration?
Any factory or business establishment having 10 or more than 10 employees, irrespective of salary, have to register with ESIC. ESI contributions must be made for all employees having a salary of less than Rs.21,000/- per month. Employees with less than Rs. 21,000 /-monthly wages get health and sickness benefits through this statutory scheme.
Following industries are required to obtain coverage under ESIC:
- Factories employing 10 or more persons irrespective of whether power is used in the process of manufacturing or not.
- Shops, hotels, restaurants, cinemas including preview theater, road motor transport undertakings and newspaper establishment employing 10/20 or more persons.
- Private Medical and Educational Institutions employing 10/20 or more persons in certain States.
In this scheme, employer’s contribution is 4.75% and an employee must contribute 1.75% for ESI. An organization having all the employees monthly wages of over Rs.21, 000/- then the organization would have to file an NIL return.