Comprehensive Guide to File ESIC Return

Employees State Insurance (ESI) is a critical facet of the Indian labor landscape, providing financial and medical assistance to workers and their families. Administered by the Employees State Insurance Corporation (ESIC), a government entity, the program serves as a social security and health insurance initiative for Indian employees. In this article, we delve into the intricacies of ESI returns – a pivotal aspect of the program ensuring accurate contributions and entitlements for both employers and employees.

What is ESI Return?

The Employees’ State Insurance (ESI) Return is a periodic filing required by employers who are covered under the Employees’ State Insurance Act, 1948, in India. The ESI scheme is a social security and health insurance program designed to provide financial and medical benefits to eligible employees. The return is a comprehensive document that contains details about the covered employees, their salaries, and the contributions made by both the employer and the employee.

Here are key points about the ESI Return:

• Frequency of Filing: Employers are required to file the ESI Return every six months. The return covers a specific period, and timely filing is crucial to comply with regulatory requirements.
• Information Included: The ESI Return includes detailed information about the employees covered under the ESI scheme. This encompasses their individual details, salaries, and the contributions made by both the employer and the employee during the specified period.
• Employer’s Contributions: Employers are mandated to make contributions to the ESI fund on behalf of their employees. The return reflects the accurate amount contributed by the employer based on a percentage of the employee’s salary.
• Employee’s Contributions: Employees also make contributions to the ESI fund. The return provides information on the specific amount deducted from each employee’s salary and contributed to the ESI fund.
• Compliance and Penalties: Filing ESI returns is a legal requirement, and non-compliance can result in penalties. Employers need to ensure that the returns are filed accurately and within the stipulated time frame.
• Verification of Benefits: The ESI Return plays a crucial role in verifying that employees are receiving the benefits they are entitled to under the ESI scheme. This includes access to medical care, sickness benefits, maternity benefits, and other related provisions.
• Self-Financing Model: The ESI program operates on a self-financing model, with contributions from both employers and employees forming the fund. The returns help in maintaining the financial integrity of the scheme.
• Legal Framework: The ESI Return filing is governed by the rules and regulations established by the Employees’ State Insurance Corporation (ESIC), which operates under the Ministry of Labor and Employment in India.

What are the documents required for filing ESI return?

• Attendance Record: Maintain an updated attendance record for all employees. This document helps in calculating the number of days each employee has worked during the specific period for which the ESI return is being filed.
• Form 6: Form 6 is the declaration form for registration under the ESI Act. Ensure that this form is accurately filled out and updated for new employees joining the organization.
• Wage Record: Keep a detailed wage record that includes information on the salary and wages paid to each employee. This record is essential for calculating the ESI contribution based on the employee’s gross salary.
• Accident Record: Maintain a list of accidents that have occurred within the workplace. This information is relevant for the ESI coverage of employees in case of work-related injuries or accidents.
• Checkbook: Have a checkbook available for the purpose of making ESI contributions. The checkbook is used to facilitate the payment of monthly contributions to the Employees’ State Insurance Corporation.
• ESI Return and Monthly Challan: The ESI return is a summary of the contributions made during a specific period. Ensure that the ESI return and monthly challan are accurately filled out and kept up to date. This includes details of employee contributions, employer contributions, and other relevant information.

What is the process to file ESI Return?

• User ID and Password: Upon registering for the Employees’ State Insurance (ESI), every employer is provided with a unique User ID, password, and a 17-digit code.
• Log in to Employees State Insurance Corporation (ESIC):
  • Visit the official website of ESIC.
  • Enter the User ID, password, and the 17-digit code provided during the registration process.
  • Click on the “Login” button to access the employer’s dashboard.
• Filling Correct Information:
  • Once logged in, ensure that the employee details are accurate.
  • Navigate to the “File Monthly Return” option located on the right side of the dashboard.
  • A list of options for editing employee details will be available on the portal. Correct any information if necessary.
• Bank Records:
  • To submit the monthly ESI contribution, fill in the bank details accurately.
  • Click on the “Submit” button to initiate the contribution process.
• Generating Challan/Currency:
  • After the ESI contribution is successfully paid, go to the “List of Actions” page on the portal.
  • Click on “Create Currency” to generate the challan for the contribution made.
  • It is essential to keep this challan for future reference and investigations.
• Chartered Accountant’s Certificate:
  • In the Monthly Contribution section, select the checkbox to accept the declaration.
  • Click on “Self-Certification” to confirm compliance with ESI regulations.
  • If the number of employees is more than 40, the Chartered Accountant’s Certificate needs to be uploaded as part of the submission process.
• ESI Return Submission by the Employer:
  • Review all the information entered for accuracy.
  • Once satisfied, click on the “Submit” button to finalize the ESI return submission.

What are the Benefits of filing ESIC returns?

The Employees’ State Insurance Corporation (ESIC) provides various benefits to registered employees, and filing ESIC returns is essential to avail these benefits. Here are some of the key benefits:

1. Medical Benefits: Registered employees and their dependents are entitled to medical benefits. This includes the provision of immediate medical care and treatment for various illnesses and conditions.
2. Social Security: ESIC serves as a social security program designed to provide financial assistance and support to employees during times of need. It covers a range of benefits, such as maternity insurance, disability compensation, and other related benefits, ensuring the well-being of employees and their families.
3. Easy Access to Benefits: Employees can easily access benefits at any ESIC-registered hospital or healthcare facility. Payments made through the scheme can be reimbursed, making it convenient for employees to receive the necessary medical care.
4. Sickness Benefits: Employees are eligible for sickness benefits, which are provided at the rate of 70% of their daily wages. If an illness lasts for more than 90 days or three consecutive months, the benefits are still provided to support the employee during a prolonged period of illness.
5. Maternity Benefits: The ESIC program mandates that companies provide maternity benefits, including maternity leave, to expectant mothers. This ensures that female employees receive support and time off during their pregnancy and childbirth.
6. Disability Benefits: ESIC coverage extends to disability benefits. In the unfortunate event of permanent incapacity or death due to unforeseen circumstances, the employee’s dependents can file a claim to receive financial assistance and support.

In conclusion, ESI returns are a cornerstone in ensuring the effective functioning of the Employees State Insurance program. Employers play a crucial role in filing accurate returns, thereby contributing to the welfare of their workforce. As a social security initiative, ESI not only safeguards employees during times of need but also fosters a more inclusive and supportive work environment.