The 60-second version
Workers compensation covers employer liability for work injury and occupational disease — mandatory for factories and hazardous work. I match headcount, wage roll, and WC policy before first payroll.
ESIC and WC are parallel — not interchangeable
Returning founders hiring factory, warehouse, or construction staff need WC policy — ESIC covers medical but WC covers employer tort liability.
Premium based on wage roll and risk category — under-declaring wages voids claim.
Policy must be active before injury date — retroactive bind not possible.
ESIC lane: ESIC registration guide.
WC vs ESIC
| Cover | WC policy | ESIC |
|---|---|---|
| Medical bills | Limited | Primary |
| Employer liability suit | WC pays | Not covered |
| Death/disability lump sum | WC schedule | ESIC pension |
| Premium basis | Wage roll × rate | ESIC contribution % |
| Mandatory for | Hazardous + factories | Wage ceiling employees |
WC policy sequence
Classify work
Factory vs shop vs office risk.
Wage roll
Monthly gross for all covered workers.
Bind WC
Annual policy before day one on site.
Display
Policy copy at workplace per Act.
Claim protocol
Incident form + hospital intimation.
Claim flow
WC policy kit
- Wage register.
- Policy schedule.
- Workplace display copy.
- Incident form.
- Insurer hotline.
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Contractors
Principal employer liability for contractor workers — verify WC of subcontractor.
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White-collar only?
WC may not be mandatory — verify state rules.
With ESIC?
Both often required for factory — not either/or.
Remote WFH?
Office injury at home debatable — consult insurer.
Premium audit?
Year-end wage true-up — refund or additional premium.
NRI owner abroad?
Indian entity still needs WC for Indian employees.
Contract labour?
Principal employer certificate required from contractor.
The plan is only as good as the sequence.
Tax, banking, schools, shipping — they all have dependencies. A wrong order costs months and lakhs. Get it right.