Online ESI  Registration Overview

Employee State Insurance or ESI is a scheme commenced by the Government of India to offer medical, monetary, and other advantages to workers. ESI is managed by an autonomous authority – Employee State Insurance Corporation – which lies under the jurisdiction of the Ministry of Labour and Employment.

By law, any company that has more than 10 employees mandatorily needs to have ESI. In some states, the number of employees is 20. For employees earning more than ₹21,000 per month, including basic salaries and dearness allowance, the insurance is deducted from their pay.

Also, taxpayers with a turnover of less than ₹1.5 crore can opt for the composition scheme to get rid of tedious GST formalities and pay GST at a fixed rate of turnover.

Benefits of ESI Registration

ESI Registration ensures that employees enjoy the following advantages:

Medical Aid

From the very first day of employment, registered ESI members and their families are entitled to enjoy the benefits of complete medical care and insurance.

Maternity Aid

Pregnant women are entitled to maternity benefits that are payable upto twenty-six weeks. This period can be extended by 30 days on medical advice. To qualify for maternity benefits, employers are required to contribute their wages for 70 days in the preceding two contributions periods.

Disablement Benefits

Disabled employees can get 90% of their monthly salaries as disablement benefits.

Sickness Benefits

Absence from work during illness can be taken for a maximum of 91 days per year along with 70% of the monthly wages.

Dependent Benefits

In the unfortunate event of the demise of an employee during the employment, the dependents of the deceased will receive 90% of his/her monthly salary.

Funeral Expenses

The family of the deceased employee is entitled to an additional amount of Rs.10,000 towards funeral expenses.

Confinement Expenses

In the case of confinement of an insured woman or wife of an employee occurring in a place with no medical facilities under the ESI scheme, confinement expenses can be availed.

In addition, some of the need-based benefits:

Vocational Rehabilitation

Permanently physically challenged, insured employees are entitled to undergo vocational rehabilitation training at VRS.

Physical Rehabilitation

Available to employees in the case of physical disablement due to an employment injury or occupational hazards.

Old Age Medical Care

An annual payment of ₹120 ensures medical care benefits for retiring ESI employees or for those who are opting for VRS/ERS.

Extended Sickness Benefits

ESI members suffering from chronic diseases can avail the extended sickness benefit for upto 2 years, once the standard sick leave of 91 days has expired.

Enhanced Sickness Benefit

Registered ESI members willing to undergo the sterilisation procedures are eligible for enhanced sickness benefits of 100% of their daily average wages. This benefit also allows a recuperating period of 7 days for vasectomy and 14 days for tubectomy from the date of surgery or admission in the hospital.

Eligibility/Entities Covered Under ESIC Registration in India

As per the ESI Act of 1948, all establishments are eligible for ESI registration provided they fulfill the criteria of having the required number of employees in that state. The entities covered are:

• Shops
• Cinemas
• Movie theatres
• Medical institutions
• Hotels or restaurants
• Newspaper establishments
• Private educational institutions
• Roadside motor transport establishments

Note: For hotels and restaurants, it is mandatory to only offer the service and not have any manufacturing functions. In some states, medical and educational institutes are not included. For newspaper establishments, there is no coverage under the Factory Act.

Eligibility for ESI Registration in India

The general rule to be eligible for ESI (Employees’ State Insurance) registration is to have 10 or more workers. But in some regions, ESI is applicable only if there are more than 20 employees.

Other eligibility criteria that need to be fulfilled are:

• Any employee whose gross salary is up to ₹21,000 per month can avail this with the help of the employer
• Establishment registered with EPFO
• The contribution to ESI is 6.5% of the gross salary. It is divided as:

• • 4.75% by the employer
  • 1.75% by the employee
• For industrial units, where there are chances of occurrence of injury or health issues at the business premise, all employees with salary less than ₹21,000 compulsorily need to have ESI.

Documents Required for online ESI Registration

To register for ESI the employer has to submit the following documents along with the application:

• The registration certificate or license issued by – Shops and Establishments Acts/Factories Act
• Address proof
• Rent receipt of the occupied premises, mentioning its capacity
• Copy of PAN card
• Copy of bank statement
• Photocopy of the last building tax/property tax receipt
• Memorandum and Articles of Association or Partnership Deed or Trust Deed – depending on the applying entity
• Photocopy of registration
• Certificate of commencement of production
• Registration No. of CST/ST/GST

Note: For ESI filings, a monthly pay sheet is required for computing the contribution amount for each employee.

Online PF Registration – an Overview

Employees’ provident fund is a social security scheme that helps employees save a small portion of their salary for future benefits.

Every company has to offer its employees an EPF or employees provident fund which is akin to a retirement fund. EPF comes under the purview of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. EPF registration is mandatory for companies with 20 or more employees. PF registration is now done through the MCA portal at the time of incorporation for private limited companies. Employers that have not yet registered for PF can do so online; Vakilsearch offers PF registration in three simple steps:

• Free consultation and form filling
• Connect with a dedicated affiliate for data validation
• Receipt of PF number.

Eligibility

To be eligible for PF Registration, an organisation has to fulfill the following criteria:

• An organisation with a total employee strength of 20 or more
• An establishment that has less than 20 workers and has been notified of compulsory registration for not less than 2 months. When a company employs fewer than 20 people, the employer can choose for voluntary PF, which must be reported to the central PF commissioner.

The employer and the employees of an establishment must mutually agree to apply for PF to the central PF commissioner. A notification has to be sent to the official gazette from the date of the agreement.

Every employee is entitled to PF from the start of his or her work. The employer is responsible for PF contribution and deduction. Employees who receive a gross-HRA ceiling of 15,000 can receive PF exemption for the first time; otherwise, all employees will be mandated PF from the start. It is the responsibility of the employer to deduct the PF contribution from the employee’s paycheck and remit it on time.

Benefits of PF Registration Online

Pension Coverage:

Besides the contribution of the employee to EPF, the employer adds an equal amount which is inclusive of employee pension scheme (EPS). Therefore, EPF saves you a robust pension.

According to the EPS Act, an employee is entitled to a monthly pension at the time of retirement or superannuation. If the employee is disabled at the time of retirement or superannuation, the employee is entitled to a pension, and if the employee dies, their nominee is entitled to a pension.

Cover of Risk:

In case of instances like illness, demise or retirement, provident fund helps the dependents of the employee by covering the financial risks they face in such situations.

Single Account/One EPF Account:

The PF account can be transferred while switching jobs. The universal account number (UAN) linked to the Aadhaar will start to facilitate the linking of the previous accounts. It can be carried forward to the new employer instead of being closed down. This uniformity ensures that the rate of return is compounded over the years.

Emergency Fund:

Emergencies are bound to happen at any point of time in life. EPF amount can be of great help during mishaps, illnesses, weddings and educational expenses. Employees can make claims online.

Employee Deposit Linked Insurance Scheme:

Any person who has a PF account is eligible for this insurance scheme that requires only 0.5 % of the salary deduction as premium. This benefit is paid out in the event of the death of an employee who was a member of the pension plan at the time of death. A maximum of ₹7 lakhs in benefits will be provided.

Extended Goals:

The PF account can be extremely helpful for long-term goals like buying a property or setting up a fund for children.

Documents Required for PF Registration

Any business that wishes to apply for PF needs to submit the following mandatory documents:

• PAN card of establishment
• Certificate of incorporation before Feb 2020
• Cross cancelled cheque of establishment
• Address proof that is in the name of the establishment
• Rent agreement (with landlord owner details like PAN and Aadhaar copy)
• Water
• Electricity
• Telephone bill
• GST certificate
• Specimen signature of directors and authorised signatories
• Digital signature of the authorised applicant
• In case of voluntary registration, consent of the majority of employees
• List of directors
• Directors Aadhaar and PAN card copy.

In some entities the underlying may also be needed:

• First sale bill
• First purchase bill of raw material and machinery
• GST registration certificate
• Bankers details
• Record of a monthly employee strength
• Register of salary and wages.