ESI Act in Noida IT Companies: Do You Need 10 or 20 Employees for Coverage?

How many employees are covered by the applicable ESI Act in an IT company located in Noida? Is it 10 or 20? Please help me.

Thank you,

Ravi

As you are an IT company covered under the Shops and Establishments Act, you require 20 eligible employees to get ESI coverage. Eligible employees are those whose salary is less than 15k. Mr. Ompal Yadav has informed about the latest amendment, which applies to factories. If it is a factory, then 10 eligible employees are required to be covered under this act.

Regards,
Ompal Singh Yadav
[Phone Number Removed For Privacy Reasons]

According to ESIC's new amendment circular, the coverage is now applicable for your employment if you have 10 employees with a gross salary of up to INR 15,000/- effective from 01/04/2011. Attached herewith is the required document for your reference.

For further details, you can contact KUMAR's SOLUTION in the Noida area via email at [Email Removed For Privacy Reasons].

Thank you.

Regards,

Coverage of ESI

The issue needs to be approached as follows:

The ESI Act, in the first instance, is applicable on its own to all factories employing ten or more employees. If an establishment is not a factory, then it can be covered only by a notification issued by the appropriate government, namely either the central or state government.

I understand that yours is an IT company. The status of an IT company as a factory is still in dispute. Thus, your company falls under the category of establishments other than a factory. In that event, you will stand covered by ESI only if there is a notification to that effect issued by the appropriate government for your establishment.

If NOIDA is located in the National Capital Region (NCR) of Delhi, then the Central Government is the appropriate government as per the notification provided by Dr. Kumar, who deserves to be thanked for it.

As per the said notification, ESI covers 'Shops' employing ten employees. Going by the plethora of legal decisions, an IT company qualifies within the meaning of 'Shop'.

If NOIDA does not fall under NCR but under any State, then you have to refer to the notification of the state in which your company is located.

Regards,
B. Saikumar
HR & Labour Law Consultant
Chipinbiz Consultancy Pvt. Ltd
Mumbai
[Phone Number Removed For Privacy Reasons]

According to my information, ESI is applicable only in municipal areas. Is this correct?

Thanks in advance.

Regards,
Shyam Kaldoke
[Phone Number Removed For Privacy Reasons]

ESI Act Amendment Coverage

As per the amendment in the ESI Act, where 10 or more employees are working under any unit, and the salary is not more than ₹15,000, they are covered under it.

Regards,
Sunil Sharma
Executive - HR