Summary of this article
· Ministry of Labour stipulates Aadhaar authentication is voluntary for ESI members
· Alternate ID such as PAN, passport, and driving license can verify identity
· Beneficiaries not using Aadhaar cannot be denied benefits
The Aadhaar card is used as an identity proof and is permitted for verifying identity to access government services. The Ministry of Labour and Employment also stipulates using Aadhaar authentication to verify beneficiary details by the Employees’ State Insurance Corporation (ESIC). However, in a gazette notification dated August 19, 2025, the Ministry clarifies that Aadhaar authentication is not mandatory, it is optional, and ESIC benefits cannot be denied to ESIC members for not submitting Aadhaar. The purpose of using Aadhaar was to improve efficiency and convenience for members and providing them social security benefits, but if a beneficiary does not want to use Aadhaar authentication, other documents to verify identity can be accepted, such as a PAN card, passport, and driving license.
The gazette notification dated August 19, 2025, by the Ministry of Labour and Employment reads, “The Employees’ State Insurance Corporation is allowed to perform authentication and be permitted the use of Aadhaar number during authentication for establishing identity of Aadhaar number holder and notify the same under rule 5 of the said rules read with sub-clause (ii) of clause (b) of sub-section (4) of section 4 of the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016 (hereinafter referred to as the said Act).”
However, the notification also says that the Aadhaar authentication will be used for authentication and ensuring good governance and streamlining social welfare benefits, but Aadhaar authentication for this purpose will be on a voluntary basis.
It clarifies, “As per sub-rule (2) of rule 3 of the said rules, Aadhaar authentication shall be on a voluntary basis. The Employees’ State Insurance Corporation shall inform to the Aadhaar number holder of alternate and viable means of identification and shall not deny any service to the Aadhaar number holder for refusing to, or being unable to, undergo Aadhaar authentication, namely:- (a) Passport; (b) PAN card; and (c) Driving license.”
The changes became effective from the date of notification.
What Is The ESI Scheme And Its Offerings?
ESIC offers social security benefits to its members. The scheme is for workers in factories, hotels, road transport, restaurants, newspapers, educational and medical institutions, and shops. The scheme applies to entities employing a minimum of 10 or more employees, whose earnings are not more than Rs 21,000.
The scheme covers employees' medical requirements, injuries during work, disability or death due to injury, medical benefits to the family, maternity benefits, and, in certain cases, rehabilitation benefits to ESIC members.
While the actual amount of contribution may differ from one employer to the other employer, depending on their salary, the benefits are the same for all, irrespective of their contribution amount. The retirees, as well as permanently disabled employees and their spouse, can continue to avail themselves of the social security benefits by paying an annual Rs 120 as a token premium.
