What is ESI And its benifits

What is ESI Scheme?

The Employees' State Insurance (ESI) Scheme is one of the most popular schemes amid employees engaged in various economic sectors in entire India. This ESI scheme is administered and regulated by an autonomous and self-financing social security and labor welfare organization named ESIC, strictly as per the rules and regulations given in the Indian ESI Act of 1948.

When is ESI Required?

ESI Registration is required when a company/firm/organization employs 10 (in few Indian States and UTs, this number is 20) or more persons, with individual wage/salary falling under the threshold limit of INR 15,000 per month. After registration, ESIC gives recognition to the employing entity and its employees through allotting a 17-digit unique identification code.

To make available the benefits provided under this ESI scheme, the registered employing entity needs to contribute 4.75% of the total monthly salaries/wages payable to its employees; while the eligible individual employees require to contribute only 1.75% of their individual monthly salary to the ESIC funds, every month of the year. Those employees who earn up to INR 100/- per day, are exempted from paying their share of contribution to the ESI scheme.

Benefits of ESI Registration

The benefits of ESI registration are offered by ESIC with efficient support of its large network of branch offices, dispensaries, and hospitals located all across India. Broadly, the major welcome benefits to the contributing employees cover the following:

1. Sickness benefits in form of salary at the rate of 70%, in case of any certified sickness lasting for a maximum of 91 days in any year.
2. An array of medical benefits and facilities to the employee and his/her family.
3. Maternity benefit to pregnant woman employees in form of paid leaves for three months.
4. In case of death of an employee caused by any occupational hazard, ESIC pays 90% of his/her salary to his/her dependents every month.
5. Disability to work will be paid at the rate of 90% of the monthly salary of the concerned employee.
6. Other benefits offered to employees by ESIC include funeral expenses compensation, physical rehabilitation, vocational rehabilitation, old age medical care, etc.