Confused About ESI Enrollment? Here's What Your Company Needs to Know to Get Started

Hi, I am working in the manufacturing sector, which has more than 300 employees, but we don't have the ESI facility. Please explain when a company can enroll its name in ESI and what are the basic things that a company needs to have for availing ESI facilities.

Understanding the Employees' State Insurance (ESI) Act

In India, the Employees' State Insurance (ESI) Act provides social security and health insurance to employees. Companies with 10 or more employees are required to register for ESI within 15 days of the Act becoming applicable to them.

Basic Requirements for ESI Enrollment

1.  **Registration:** The company needs to register under the ESI Act within the specified time frame.
2.  **Employee Count:** The company should have at least 10 employees to be eligible for ESI coverage.
3.  **Wages:** The wages of employees should be within the defined limit as per the Act.
4. ✅ **Compliance:** The company must comply with all regulations and rules outlined in the ESI Act.

By fulfilling these requirements, a company can enroll in ESI and provide its employees with health insurance and other benefits as mandated by the law.

In any manufacturing industry with an employment strength of 10 or more, it is mandatory to enroll with ESI and PF. You must submit the duly signed application form and supporting documents to get enrolled for ESI.

For coverage under the ESI Act, 1948, and the rules/regulations framed thereunder, the coverage eligibility starts immediately when the factory employs 10 or more persons. Such coverage is required only if it is situated in a place/area where the Central Government has extended the provisions under section 1(3) of the said Act.

The State Government has also extended the provisions of the said Act under section 1(5) to some establishments, namely hotels, restaurants, private medical institutions, transport establishments, etc.

Since you have not disclosed the nature of your establishment, i.e., whether it is a factory or an establishment, and have also not disclosed whether the same is located in an implemented area as declared under section 1(3), it is suggested that you may contact the appropriate branch office of ESIC nearest to your place of establishment. Ascertain the position regarding the coverage, etc., of your establishment under the said Act.

Thank you.

You need to first find out from the neighborhood of your factory whether ESI is applicable in your area. If ESI is applicable in your area, then ESI applies to your factory from the date your factory had 10 or more employees (on or after 01.06.2010). You need to apply for coverage of your factory under ESIC immediately online, giving the date on which your factory reached 10 employees for the first time. Your liability for ESI contribution starts from the date your factory reached 10 employees for the first time.

If your factory is very old, then the law is different prior to 1.06.2010 regarding the applicability of the Act, ESI salary limit, and the rate of contribution. If ESI is not applicable in your area, then no ESI is applicable to your factory.

You have not stated anything about your office(s), branches, depot, or other workplaces, etc. Therefore, the answer is limited to your factory.

Our plant is a manufacturer of Ferroalloy and is located in the APSEZ area. I want to know, in order to be a member of ESIC, does the establishment need to have any hospital set up by ESIC nearby the factory premises? If so, within how much distance does the hospital need to be from the company?

It is not mandatory to have an ESI dispensary nearby. That is the responsibility of ESIC. If your factory is in a place where the ESI Act is applicable, you have to comply with the Act.

Regards,
Varghese Mathew

Our factory has 300 employees, as mentioned previously, so it defaults to fall under the category to opt for the ESIC facility.

Regards,
Raja