The Employees’ State Insurance Act,1948 Eligibility - Applicability and Rules Governing

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Hi All,

Can I get more details on applicability, eligibility and contributions of the ESI scheme from both employer and employee side?

Thank you.
Swati

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Hi

Appilcability - 10 or more
Eligibility - salary less than 21000
Employer contribution - 3.25% of gross wages
Employee contribution 0.75% of gross wages

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Hi Swati,

Please visit this link which will provide details in depth.

The Employees’ State Insurance Act,1948 (greythr.com)

Hope the above helps.

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Hi @Swati

In simple ESI means the following checklist that Bharath has shared.

  1. Check your state is there an ESI eligibility (All States in India except for Nagaland, Manipur, Sikkim, Arunachal Pradesh, and Mizoram and Applicable to Delhi, Chandigarh, and Puducherry)
  2. Check your employees count (Applicable to non-seasonal factories employing 10 or more persons.)
  3. Type of establishment you have (The scheme has been extended to shops, hotels, restaurants, cinemas (including preview theatres), road-motor transport undertakings, and newspaper establishments employing 20 or more persons.)*
  4. Wage limit of employees ( The existing wage limit for coverage under the Act is Rs. 21,000/- per month ( w.e.f. 01.01.2017))

If you run through 04 items - things will get more clear.

Also as bhuvana shared use this link it has all the forms / rules & regulations: https://www.greythr.com/wiki/acts/employees-state-insurance-act1948

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PFA FAQ’s on ESIC.

ESIC FAQs.pdf (1.0 MB)

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Company eligibility requires 10 coverable employees or total 10 employees?

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Hi @Rajasekar16 It’s 10 or more employees in overall irrespective of the eligibility.

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Hi @Dinesh

I have gone through the below judgement copy of Delhi High Court and have understood that ESI eligibility requires coverable employees. Please correct me if I am wrong. Thank you.

Delhi High Court

M.M. Suri & Associates Pvt. Ltd. vs E.S.I. Corporation on 1 January, 1997

Equivalent citations: 65 (1997) DLT 741, 1997 (40) DRJ 405, (1997) ILLJ 843 Del

Bench: J Singh

JUDGMENT Case Note:

Employees’ State Insurance (Amendment) Act, 1975 Section 2(12) r/w 75–Factory–Meaning of–Defined-Respondent (ESIC) asked appellant company to submit form No. 01-- Company pleaded it is not a “shop” and not covered under notification and number of employees is less than 20–Respondent unmoved–Petition Under Section 75 of the Act–Trial court held petitioner/appellant is a “shop”–Appealed against and pleaded company and cannot be treated as “factory”-- Impugned order set aside.

Words and Phrases - Defined-“Shop”, “Factory”, “Employee(s)”, “Persons employed” and

“wages”–Meaning of-- Explained.

  1. The question for consideration in this appeal 9 is whether the appellant M/s. M. M. Suri & Associates Pvt. Ltd. is a “factory” within the meaning n of Section 2(12) of the Employees’ State Insurance (Amendment) Act, 1975 (hereinafter called the Act).

  2. The facts fall into a short compass. Having been asked by the Employees’ State Insurance Corporation by its letter of July 26, 1990 to submit Form No.O.1, the appellant-Company took the stand that it was not a “shop” and as such not covered by the above - referred Notification and that, in any case, the number of its employees being less than 20, the provisions of the Act could not be extended to it. However, since the Corporation remained unmoved, the appellant-Company filed a petition under Section 75 of the Act.

  3. The learned Senior Civil Judge, before whom the petition came up for disposal, held that as the Company was dealing in retail sale Of services, it was “shop” and that as admittedly 24 persons were employed, Section 2(12) was attracted notwithstanding the fact that out of the said employees 13 were drawing more wages than the prescribed limit and thus were not “employees” within the meaning of Section 2(9) of the Act.

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