Navigating ESI Act Registration: Do We Need to Enroll Our NGO Employees?

Dear Madam/Sir, We are working in an NGO, duly registered under the Societies Act, 1860, in the year 1979, and it has become one of the reputed NGOs in the field of social activities. Since 1979, our organization has been working on various projects funded by foreign agencies as well as by government departments such as RWSS and PR to date. We usually work with village communities, and the financial arrangements, including bills, are managed through the Village Level Societies. Since 2014, our organization has been working as a technical consultant for a government project funded by the World Bank.

Today, we received a request letter from the Employees' State Insurance Corporation, Regional Office, Odisha, stating that as we have been engaged as Project Management Consultant-cum-Technical and Social Support Agency for the externally aided government project, we must register our organization as well as our employees under the ESI Act 1948 to avail benefits under the same. Do we need to do this?

Employee Details

Employee Strength: 300+

We are registered under EPF and EDLI, and there is also a Gratuity scheme in place. We have provisions for Health Insurance up to 3 lakh and an Accidental Insurance Policy up to 10 lakh. Out of the 300 employees, 100 are permanent, and the rest are contractual.

Please advise. Thank you.

As per the ESI Act 1948, organizations with 10 or more employees must be registered under the Employees' State Insurance (ESI) scheme. Given your employee strength of 300+ and the nature of your organization's work, it is advisable to comply with the ESI Act requirements. Here are the steps you can take:

Assessment and Compliance Steps
1. Verify Applicability: Confirm if your NGO falls under the purview of the ESI Act based on the number of employees.
2. Registration Process: Initiate the registration process with the nearest ESI office in New Delhi, India.
3. Documentation: Prepare the necessary documents such as employee details, registration certificate, and other relevant information.
4. Employee Enrollment: Enroll all eligible employees, including permanent and contractual staff, under the ESI scheme.
5. Contribution Payment: Ensure timely payment of ESI contributions for both the organization and employees.
6. Compliance Check: Regularly review and update compliance with ESI regulations to avoid penalties.

Benefits of ESI Registration
- Health Coverage: Access to medical benefits for employees and their dependents.
- Financial Security: Assistance in times of illness, injury, or maternity leave.
- Compliance: Fulfilling legal obligations and ensuring employee welfare.

It is recommended to consult with a legal advisor or HR specialist familiar with Indian labor laws to ensure accurate compliance with the ESI Act. Failure to comply could lead to penalties or legal consequences.