Maharashtra High Court: ESIC Clarifies ESI Scheme Coverage for Educational Institutions

• The ESIC issued a circular on July 27, 2026, clarifying coverage under the ESI Scheme in Maharashtra.
• The Code on Social Security, 2020, governs coverage under the ESI Scheme, with Section 1(4) outlining provisions and Section 2(29) defining eligible establishments.
• Liability to pay ESI contributions arises from November 21, 2025, subject to fulfilling statutory conditions.
• Compliance officers must review eligibility and ensure timely payment of contributions to avoid liability under Section 29.

The Code on Social Security, 2020, governs the coverage under the ESI Scheme, with Section 1(4) outlining provisions and Section 2(29) defining eligible establishments.

On July 27, 2026, the Employees State Insurance Corporation (ESIC) issued a crucial circular that clarifies the coverage of educational institutions and medical establishments in Maharashtra under the Code on Social Security, 2020. This move comes after ESIC had earlier put on hold the implementation of the Maharashtra Government's notification dated January 30, 2026. The circular directs field offices to ensure that all eligible establishments are covered in accordance with the Code. With this clarification, ESIC has effectively brought an end to any uncertainty surrounding the applicability of the ESI Scheme in Maharashtra.

The Code on Social Security, 2020, which came into force on November 21, 2025, governs the coverage under the ESI Scheme. Section 1(4) of the Code read with its First Schedule outlines the provisions for coverage, while Section 2(29) defines the scope of establishments that fall within the ambit of the Code. Notably, the liability to pay ESI contributions arises from November 21, 2025, subject to fulfilling the statutory conditions prescribed under the Code. This means that all eligible establishments in Maharashtra must comply with the provisions of the Code to avoid liability under Section 29.

The ESIC clarification has significant implications for educational institutions and medical establishments in Maharashtra. Compliance officers should review their establishments' eligibility for ESI Scheme coverage and ensure timely payment of contributions to avoid liability under Section 29 of the Code on Social Security, 2020. Failure to comply with the provisions of the Code can result in severe consequences, making it essential for these establishments to take immediate action to rectify any non-compliance. By ensuring timely compliance, these institutions can not only avoid liability but also contribute to the overall goal of providing social security benefits to their employees.

Compliance officers should review their establishments' eligibility for ESI Scheme coverage and ensure timely payment of contributions to avoid liability under Section 29 of the Code on Social Security, 2020.

Source: Original reporting via ESIC Clarification on Coverage under Social Security Code 2020 in Maharashtra