{"id":113,"date":"2025-09-25T20:30:17","date_gmt":"2025-09-25T15:00:17","guid":{"rendered":"https:\/\/amfos.in\/taxupdates\/?p=113"},"modified":"2025-09-25T20:30:17","modified_gmt":"2025-09-25T15:00:17","slug":"what-is-esic-scheme-who-is-eligible-what-are-the-importance","status":"publish","type":"post","link":"https:\/\/amfos.in\/taxupdates\/2025\/09\/25\/what-is-esic-scheme-who-is-eligible-what-are-the-importance\/","title":{"rendered":"What is ESIC scheme? Who is eligible? What are the Importance?"},"content":{"rendered":"

The\u00a0Employees’ State\u00a0Insurance\u00a0Scheme of India (ESIC) is a multi-faceted Social Security Scheme designed to provide socio-economic protection to ’employees’ in the organized sector. ESIC Scheme is administered by a statutory corporate body called the Employees’ State Insurance Corporation.<\/p>\n

Who is eligible for\u00a0ESI?<\/strong><\/h3>\n

The ESI scheme is\u00a0applicable<\/strong>\u00a0to all factories<\/strong>\u00a0and\u00a0other establishments<\/strong>\u00a0as defined in the ESI Act\u00a0with 10 or more persons\u00a0<\/strong>(20 or more in some states)\u00a0<\/strong>employed in such establishments. However, only those employees are covered under the ESI scheme whose\u00a0monthly wages do not exceed Rs.21,000<\/strong>\u00a0(Rs.25,000 in the case of a person with a disability). The applicability of the scheme is explained through a flow chart below:<\/p>\n

It is the employer’s responsibility to enroll eligible employees in the ESIC program.<\/p>\n

The contributions are based on the workers’ earning ability as a fixed proportion of their salary, yet they are awarded social security benefits based on individual needs without discrimination.<\/p>\n

The\u00a0scheme under the ESI Act also applies\u00a0to the following:<\/strong>\u00a0<\/span><\/h4>\n
    \n
  1. Shops\u00a0<\/span><\/li>\n
  2. Restaurants\u00a0<\/span><\/li>\n
  3. Hotels\u00a0<\/span><\/li>\n
  4. Cinema theatres\u00a0<\/span><\/li>\n
  5. Road motor transport undertakings\u00a0<\/span><\/li>\n
  6. Newspaper establishments and undertakings\u00a0<\/span><\/li>\n
  7. Educational institutions<\/span><\/li>\n
  8. Medical institutions\u00a0<\/span><\/li>\n
  9. Contract and casual employees of Municipal Corporations or Municipal Bodies.\u00a0<\/span><\/li>\n<\/ol>\n

    It also\u00a0applies to the following establishments under the Central Government\u00a0<\/strong>employing 20 or more persons engaged in:\u00a0<\/span><\/h4>\n
      \n
    1. Insurance business\u00a0<\/span><\/li>\n
    2. Non-Banking Financial Companies (NBFCs)\u00a0<\/span><\/li>\n
    3. Airport authorities\u00a0<\/span><\/li>\n
    4. Port trusts\u00a0<\/span><\/li>\n
    5. Warehousing establishments<\/span><\/li>\n<\/ol>\n

      ESIC Contribution Rates:<\/strong><\/h2>\n\n\n\n\n\n\n
      Particulars<\/strong><\/td>\nReduced Rate\u00a0<\/strong>
      \n(Rate after 01\/07\/2019)<\/strong><\/td>\n<\/tr>\n
      Employer Share<\/td>\n3.25%<\/td>\n<\/tr>\n
      Employee Share<\/td>\n0.75%<\/td>\n<\/tr>\n
      Total<\/strong><\/td>\n4.0%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

       <\/p>\n

      Is it mandatory for the Employer to register under the scheme?<\/strong><\/h3>\n

      Yes, under Section 2A of the Act and Regulation 10-B, it is the employer’s legal responsibility to register their factory\/ establishment under the ESI Act within 15 days of its applicability to them.<\/p>\n

      The section 46 of the Act envisages following six social security benefits. However, there are conditions to avail these benefits According to the ESIC website, these are the benefits that can be availed from ESI scheme.<\/p>\n

      Medical Benefit<\/strong>:<\/p>\n

      From the moment an insured person starts insurable employment, he and his family receive full medical care. There is no limit on how much an Insured Person or a family member can spend on treatment. On payment of a nominal annual premium of Rs 120\/-, medical care is also provided to retired and permanently disabled covered persons and their spouses.<\/p>\n

      Sickness Benefit:<\/strong><\/p>\n

      During periods of certified sickness for a maximum of 91 days per year, insured workers are entitled to Sickness Benefit in the form of cash compensation at the rate of 70% of salaries. To be eligible for illness benefits, the insured worker must contribute for 78 days during the course of a 6-month period.<\/p>\n

      Maternity Benefit<\/strong>:<\/p>\n

      Maternity Benefit during confinement\/pregnancy is payable for twenty-six (26) weeks, with a one-month extension on medical advice, at the full salary rate, subject to payment for 70 days in the preceding two Contribution Periods. Maternity Benefit during confinement\/pregnancy is payable for twenty-six (26) weeks, with a one-month extension on medical advice, at the full salary rate, subject to payment for 70 days in the preceding two Contribution Periods.
      \n
      \nDisablement Benefit:<\/strong><\/p>\n

      Temporary disablement benefit:<\/strong><\/p>\n

      From day one of entering insurable employment & irrespective of having paid any contribution in case of employment injury. Temporary Disablement Benefit at the rate of 90% of wage is payable so long as disability continues.
      \nPermanent disablement benefit<\/strong>:<\/p>\n

      The benefit is paid at the rate of 90% of wage in the form of monthly payment depending upon the extent of loss of earning capacity as certified by a Medical Board.<\/p>\n

      Dependents Benefit:<\/strong><\/p>\n

      DB paid to the dependents of a deceased Insured person in the form of a monthly payment at a rate of 90% of wage in circumstances where death occurs due to a job injury or occupational hazard.<\/p>\n

      Other Benefits:<\/strong><\/p>\n

      1.\u00a0Funeral Expenses<\/strong>:<\/p>\n

      From the first day of insurable work, a sum of Rs.15,000\/- is payable to dependents or the person performing final rites.<\/p>\n

      2.\u00a0Confinement Expenses<\/strong>:<\/p>\n

      An insured woman or an I.P. in respect of his wife in the event of confinement in a location where appropriate medical services are not accessible under the ESI Scheme.<\/p>\n

      For more info visit \u2013\u00a0https:\/\/amfos.in<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

      The\u00a0Employees’ State\u00a0Insurance\u00a0Scheme of India (ESIC) is a multi-faceted Social Security Scheme designed to provide socio-economic protection to ’employees’ in the organized sector. ESIC Scheme is administered by a statutory corporate … Read More<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"ppma_author":[53],"class_list":["post-113","post","type-post","status-publish","format-standard","hentry","category-esic","entry"],"authors":[{"term_id":53,"user_id":1,"is_guest":0,"slug":"taxupdates_user","display_name":"Areful Mallick","avatar_url":"https:\/\/amfos.in\/taxupdates\/wp-content\/uploads\/2025\/09\/cropped-img19-96x96.png","author_category":"1","first_name":"Areful","last_name":"Mallick","user_url":"https:\/\/amfos.in\/","job_title":"CEO & Founder","description":"CEO & Founder"}],"_links":{"self":[{"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/posts\/113","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/comments?post=113"}],"version-history":[{"count":1,"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/posts\/113\/revisions"}],"predecessor-version":[{"id":114,"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/posts\/113\/revisions\/114"}],"wp:attachment":[{"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/media?parent=113"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/categories?post=113"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/tags?post=113"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/amfos.in\/taxupdates\/wp-json\/wp\/v2\/ppma_author?post=113"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}