Employee State Insurance (ESI) is a social security and health insurance scheme governed by the Employees' State Insurance Corporation (ESIC) under the ESI Act, 1948. It provides medical, disability, maternity, and unemployment benefits to employees working in India’s organized sector, particularly in industries like manufacturing, retail, logistics, and facility management. ESI applies to organizations with 10 or more employees (in some states, the threshold is 20) and covers workers earning a monthly wage of up to ₹21,000.

For businesses managing contract workers, gig employees, and blue-collar workforce, ESI compliance is essential to ensure legal adherence, employee welfare, and reduced financial risks. Employers contribute 3.25% of the employee's wages, while employees contribute 0.75%, enabling access to medical care, hospitalization benefits, sickness leave, and family support. Companies leverage HRMS platforms and automated payroll systems to streamline ESI deductions, maintain compliance records, and ensure timely filings with ESIC. A well-managed ESI framework enhances employee security, retention, and overall workplace well-being.