What is Employee State Insurance Act – ESI

INTRODUCTION

Employees State Insurance (ESI) is devised by Parliament in the year of 1948. The ESI Act enables to provide medical and financial support to employees. The support is provided when an employee is sick or supporting from employment injury and maternity.

UNDERSTANDING ESI

To utilize the ESI, Employees must be subscribed to the scheme to get medical assistance. The scheme can be utilized when employees suffer from an injury caused at work, Death, and maternity.
The amount provided in ESI is self-financed by employers and employees during the time of employment.

APPLICATION OF ESI

ESI is applicable to an organization that has more than 10 Employees. The organization here includes shops, restaurants, and café as well that is not engaged in manufacturing, cinemas and road motor transport establishments, newspaper establishments, private educational and medical institutions.
The minimum number of employees required to subscribe to the ESI scheme varies with states ranging from 10 to 20.

REGULATIONS:

Employees working for factories/establishments with ten or more employees drawing wages of up to Rs.21,000 per month are entitled to receive health benefits under the ESI Act.

There comes an Exemption always to the regulations. When an employee average salary is Rs.137.They are exempted from contribution and it is paid by employers themselves.