Applicability of ESI in Educational Institutions
This is a very interesting question. The Schools, Colleges, Universities, and other Educational Institutes, though considered "Establishments," are exempt from the state law relating to shops and establishments. However, in the state of Tamil Nadu, by a notification dated January 02, 2013, the state government extended the provisions of the ESI Act to Shops, Hotels, Restaurants, Road Motor Transport Establishments, Cinemas, Newspaper Establishments, Educational Establishments, and Medical Institutions, including hospitals, nursing homes, diagnostic centers, and pathological labs, where 10 or more persons are employed. Therefore, in the State of TN, the ESI act is now applicable to every such establishment employing 10 or more persons and located in the implemented part of TN State.
There is no such notification for the State of Maharashtra; at least, I have not come across one.
Many companies run schools and hospitals as a charity and for the benefit of the employees and society. Employment in such schools and hospitals, if shown as part and parcel of the manufacturing activity, would mostly make ESI applicable to schools and hospitals. If it is applicable, then it is to be applied right from the entry into employment. Another point would be whether a teacher can be considered an employee under the ESI Act. Teachers are not workmen under the ID Act but are covered under the Gratuity Act.
In conclusion, if ESI is applicable, it applies from the beginning of employment and not after the completion of 3 years.