Employee State Insurance Corporation or ESIC is a self-financing social security and health insurance scheme which provides medical benefit, sickness benefit, maternity benefit, disablement benefit and various other benefits such as funeral expenses, free supply of physical aids etc. to the employees and their family.
• Under Section 2(12) the ESI Act 1948 is applicable to non-seasonal factories employing 10 or more persons.
• Under Section 1(5) of the Act, the Scheme has been extended to shops, hotels, restaurants, cinemas including preview theatres, road-motor transport undertakings, newspaper establishments, establishments engaged in Insurance Business, Non Banking Financial Companies, Port Trust, Airport Authorities and Warehousing establishments employing 10* or more persons.
• Further under section 1(5) of the Act, the Scheme has been extended to Private Medical and Educational institutions employing 10* or more persons in certain States/UTs.
• The existing wage limit for coverage under the Act effective from 01/01/2017 is Rs.21,000/- per month [Rs. 25,000/- per month in the case of persons with disability].
• However the threshold for Coverage of establishments is still 20 Employees in Maharashtra and Chandigarh. Benefits of ESI registration
• Medical Benefits: Complete medical care to all persons registered under ESI and their family members. Retired and permanently disabled insured persons and their spouses are provided the medical care on payment of Rs.120/- of a token annual premium.
• Sickness Benefits: This benefit at the rate of 70% (in the form of salary) is payable in case of any certified sickness for a maximum of 81 days in a year. In order to be eligible for the sickness benefit, the insured worker has to contribute for 78 days for a period of 6 months. Workers can claim extended sickness benefit upto 2 years at an enhanced rate of 80% of salary, in case he / she is suffering from long-term diseases.
• Maternity Benefit: Maternity benefit for pregnancy is provided for a period of 3 months. Extendable by further one month on medical advice at the rate of complete salary subject to contribution for 70 days in the next year.
• Disablement and Dependant benefit: In case of permanent disablement, the benefit is payable at the rate of 90% of wage in the form of the monthly payment as certified by Medical board. If in case of the death of an employee during company premises Dependant benefit is paid at the rate of 90% of the salary to his / her dependants every month after the death of the employee.
• Funeral expenses: Dependants or the person who performs the last rites, Rs. 15000/- is paid to them from day 1 of entering the insurable amount.
• Old age care medical expenses: Medical facilities are free of cost for the insured persons who go out employment because of old age or disability due to a work-related injury.