ESI (Employee State Insurance)

ESI is a self-financed social security and health insurance scheme covering employees earning up to ₹21,000 per month (₹25,000 for persons with disabilities). It becomes mandatory once an establishment employs 10 or more people in most states — a threshold that arrives faster than most growing businesses plan for. Maharashtra and Chandigarh set the threshold at 20 employees instead of 10.

Once ESI applies, the employer deducts 0.75% of gross wages from the employee and contributes 3.25% from the employer side, both remitted to ESIC by the 15th of the following month. In exchange, covered employees and their dependents get access to medical care, sickness benefit, maternity benefit, and disability cover through ESIC facilities.