The Employees’ State Insurance Corporation or ESIC is a statutory corporate body set up under the ESI Act of 1948. This body is responsible for the functioning of the ESI Scheme. The ESI scheme is a self-financing social security scheme. It protects the employees against financial issues due to sickness, disablement or death due to employment injuries. This article answers some common queries regarding the ESI registration process. Going forward, we are going to answer three essential questions – how to know the ESI eligibility for the establishment, how to register an establishment under ESI, what documents are needed for the ESI registration process and queries regarding ESI monthly compliance.
Which establishments need ESI registration?
According to the ESI Act, if a company crosses a particular employee count then it must register under ESI. This employee count varies from state to state, for example, the count in Rajasthan is 10, while it is 20 in some other states. In the future, this count might be standardized to 10 all over India. If an employer fails to register his/her company, he/she will have to face penalties. Once the company is registered, all the employees working at that time are automatically registered too.
Therefore, check with your State’s ESI guidelines and figure out the number of employees required for ESI registration process. If you have the required number, then within 15 days you must complete your ESI registration process. Otherwise, the company or business will be levied a penalty.
What are the documents needed for new ESI establishment registration?
For ESI establishment registration process, a business or a company does not require any different files of documents. As a matter of fact, all the papers related to the business are necessary. The following list of documents is important for ESI establishment registration process.
The documents of Company Details include
- company name
- address proof
- incorporation certificate
- GST/Tax certificates
- bank account details with a cancelled cheque.
The documents of Employer’s Details include:
- Aadhaar card
- PAN Card of Owners/ Directors/ Partners
- Specimen Signature
The documents of Employee’s Details include:
- name of the employees
- their father’s name
- date of joining
- date of birth
- Aadhaar card of the employee as well as a family member.
Provide all the documents and details in the form of an excel sheet, so it will be easy to process for registration. But, before you register your business, you must remember some important aspects. First, the ESIC registration process is a one-time activity, i.e., if your company has registered once, it cannot un-register itself later. It might so happen that while registering, the number of employees was 10, but within some years the number decreased. Even though, ESI will still cover the organisation.
Secondly, when you are collecting the Aadhaar number from the employees, make sure they are correct and have no mistakes. Moreover, each and every detail of the employees’ must be according to their Aadhaar. Presently, ESI is not making any separate cards for their records. Hence, the Aadhaar card is the sole document to acquire all the benefits. Now, if the details are wrongly filled, then the employees have to suffer. Make sure, employers update the right details so that neither the employees nor their family members have to go through any trouble at the time of need.
For a step by step tutorial on ESI employee registration, check the blog ESIC Registration For New Employee | Generate IP Number in ESI Portal Online.
What is the Monthly Compliance for ESI?
ESI establishment registration is similar to tying a marital knot. Just as you have to bind to the nuptial rounds for your entire life, ESI registration is never going to cancel your company from its shackles. Jokes apart, you must know that after you have registered your company for ESI, there is a monthly, quarterly and yearly compliance.
On a monthly basis, you have to prepare a challan for ESI and submit it on time. This is a contribution that goes as insurance to all your employees. So, they can take the benefits from the government for health and other sectors. Other than this, there are some other forms which you need to fill up each month such as employee register, leave register, Form 16 and Form 24. Moreover, companies also have to file an annual return. Learn about all the important ESI forms in our blog, Types Of ESI Claim Forms.
Therefore, you should have a tie-up with an ESI consultant. Since they are the ones who will take all your headache and complete these work within time. Consultants will charge a nominal amount and you will have all your returns and files up to date. If you think, your HR level cannot manage all the fundamentals of ESI, then you can contact us at www.esipfadvisor.com.
For more information, check out this video by the Labour Law Advisor team on YouTube.
As these tasks are highly specialised, it is recommended to hiring a consultant who will execute these tasks with utmost care and a very low cost. P.I. Jain and Company serve more than 500 companies across India and helping them with their payroll processing needs and EPF consultancy. We have been providing excellent PF Consultancy for over 40 years with hundreds of clients, and we look to expand further all over India.
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