Employee State Insurance (ESI) in India

ESI is a central social security scheme. Unlike Professional Tax or the Labour Welfare Fund, its contribution rates and wage ceiling are the same across every state. Here's the full breakdown: rates, due dates, registration, and benefits.

Updated: 01 August 2026

ESI Contribution Rates

Contributor	Rate	Base
Employer	3.25%	Gross monthly wages
Employee	0.75%	Gross monthly wages
Total	4%	Gross monthly wages

* Wage ceiling for ESI coverage: ₹21,000/month (₹25,000/month for employees with disabilities). Employees earning up to ₹176/day in average wages (employee share only; employer still contributes).

Applicability, Due Dates & Registration

Who It Applies To

Factories and establishments with 10 or more employees (20 or more in a few states, including Maharashtra and Chandigarh) drawing wages up to the ESI wage ceiling.

Due Date

15th of the following month, via the ESIC portal, as published by ESIC.

Registration

Employers must register on the ESIC portal within 15 days of coverage attaching to their establishment (that is, on crossing the employee threshold). Each employee is issued a 17-digit Insurance Number after registration.

ESIC portal ↗

Contribution & Benefit Periods

Contribution: 1 April – 30 September → Benefit: 1 January – 30 June (following year)
Contribution: 1 October – 31 March → Benefit: 1 July – 31 December (same year)

Delayed payment attracts simple interest for every day of default, and unpaid contributions are recoverable as arrears of land revenue. Non-payment and false representation are punishable offences. The interest rate and the penalty amounts are set under the Code on Social Security, 2020 and by ESIC; check the current figures on the ESIC portal before relying on them. FIGURES REMOVED 2026-08-30: the previous text stated 12% per annum, two years imprisonment and a ₹5,000 fine, citing section 85 of the repealed ESI Act, 1948.

ESI Benefits

Sickness benefit

Cash compensation during certified sickness, generally 70% of average daily wages for up to 91 days a year.

Maternity benefit

Paid leave for confinement, miscarriage, or related illness, up to 26 weeks at full average daily wage.

Disablement benefit

Temporary or permanent disablement compensation, paid as a percentage of wages depending on the degree of disability.

Dependants' benefit

Monthly pension to dependants if an insured employee dies due to an employment injury.

Medical benefit

Free, full medical care for the insured employee and family at ESI dispensaries and hospitals, from the day of entering insurable employment.

Funeral expenses

A lump sum (currently ₹15,000) paid to the family or the person who performs the last rites.

Mannu Matta

Updated on: 01 August 2026

Frequently Asked Questions

What is the current ESI contribution rate?

The total ESI contribution is 4% of gross monthly wages: 3.25% paid by the employer and 0.75% deducted from the employee. This rate has been unchanged since July 2019.

What is the ESI wage ceiling?

Employees drawing gross wages up to ₹21,000/month (₹25,000/month for employees with disabilities) are covered under the ESI scheme.

Which establishments must register for ESI?

Factories and establishments with 10 or more employees (20 or more in some states, such as Maharashtra and Chandigarh) drawing wages within the ESI ceiling must register on the ESIC portal within 15 days of becoming liable.

When is the ESI contribution due each month?

Employers must remit both employer and employee contributions by the 15th of the following month through the ESIC portal.

Is ESI applicable across all states in India?

Yes. Unlike Professional Tax or the Labour Welfare Fund, ESI is a central scheme, now under the Code on Social Security, 2020, and applies uniformly nationwide. Only the minimum-employee threshold for coverage varies slightly by state.

What happens if an employee's salary crosses ₹21,000 mid-year?

Once covered in a contribution period (April–September or October–March), an employee stays covered under ESI for the rest of that period even if their wages rise above the ceiling. Coverage is reassessed at the start of the next period.

What benefits does ESI provide?

ESI covers sickness, maternity, disablement, and dependants' benefits, along with free medical care for the insured employee and family, and funeral expenses, all funded entirely from the employer and employee contributions.

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