In India, ESI stands for the Employees' State Insurance. It is a comprehensive social security scheme that provides medical and cash benefits to employees and their dependents in case of sickness, maternity, and employment injury. The scheme is administered by the Employees' State Insurance Corporation (ESIC), a government entity.
Meaning of Employees' State Insurance (ESI):
ESI is a self-financing social security scheme that provides medical, monetary, and other benefits to employees and their families. It aims to protect employees from unforeseen health-related events and ensure they have access to medical care and financial support.
ESI Formula:
The contribution towards the Employees' State Insurance is based on a percentage of the employee's wages. As of my last knowledge update in September 2021, the contribution rates are as follows:
Employee's Contribution: 0.75% of the wages
Employer's Contribution: 3.25% of the wages
The total contribution (employee's and employer's combined) is 4% of the employee's wages.
ESI Eligibility:
Employees earning wages up to a certain limit and working in establishments employing 10 or more persons (in some states, it's 20 or more persons) are eligible for ESI coverage. The wage limit is periodically revised by the government. The scheme covers various benefits, including medical treatment, cash benefits during sickness, maternity leave, and more.
Employees who are covered under the ESI scheme are required to contribute a portion of their wages, and their employers also make contributions. These contributions provide the funds for the benefits provided by the ESI scheme.
Note: The information provided is based on my knowledge as of September 2021. It's important to note that rules and regulations may change over time. For the most up-to-date information on Employees' State Insurance (ESI), including any recent changes in contribution rates or eligibility criteria, it's advisable to consult official government sources or the concerned authorities.
