- Background
The Employees’ State Insurance Corporation (ESIC), Regional Office, Mumbai, has issued a Revised Circular dated 12.02.2026 concerning the proposed extension of ESIC coverage to Educational and Medical Institutions employing 10 or more persons in Maharashtra.
This circular is issued in continuation of an earlier circular dated 11.02.2026 and refers to a notification published by the Government of Maharashtra extending the provisions of the Employees’ State Insurance Act, 1948 to such institutions.
- Legal Development
The Government of Maharashtra has subsequently informed ESIC that:
– The Employees’ State Insurance Act, 1948 stands repealed, and
– The Code on Social Security, 2020 has come into force with effect from 21.11.2025.
In view of the repeal of the ESI Act, the State Government has initiated action to cancel the notification issued under Section 1(5) of the ESI Act, 1948, as the legal basis for such notification no longer exists.
- Directions Issued by ESIC
Based on the directions of the Government of Maharashtra, ESIC has instructed all field offices to:
– Keep in abeyance the implementation of the said notification, and
– Suspend all further action under the notification until further orders are issued
- Compliance Implications for Employers
- a) ESIC Registration
– Educational and Medical Institutions are not required to obtain ESIC registration based solely on the stayed notification.
- b) ESIC Contributions
– There is no obligation to commence deduction or payment of ESIC contributions pursuant to this notification.
- c) Returns, Records & Inspections
– No ESIC returns, declarations, or compliance actions are required under this notification.
– Any enforcement action initiated exclusively under this notification is required to be kept in abeyance.
- d) Existing Coverage
– Institutions already covered under ESIC for other valid reasons (e.g., factories or previously notified establishments) remain unchanged and fully compliant under existing law.
- Forward-Looking Consideration
While the present notification has been stayed, employers should note that:
– The Government may issue a fresh notification under the Code on Social Security, 2020 covering Educational and Medical Institutions.
– Such notification, if issued, may introduce new thresholds, definitions, or compliance requirements.
Employers are therefore advised to maintain readiness in terms of employee data, wage records, and contractual arrangements, without taking any immediate compliance action.
- Recommendation
Employers are advised to take note of the circular and maintain status quo with respect to ESIC compliance. No new ESIC registration or contribution is required at present based on the stayed notification. Institutions should, however, closely monitor future notifications issued under the Code on Social Security, 2020 and be prepared to comply promptly once a valid legal framework is notified.
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