Section 24 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 24 of the Code on Social Security, 2020 opens Chapter IV (Employees' State Insurance Corporation). It lets the Central Government appoint a Director General and a Financial Commissioner as the two Principal Officers of the Corporation, fixes their term and removal, and sets out how the Corporation recruits its own officers and staff.
The Central Government may appoint a Director General and a Financial Commissioner, who are the Principal Officers of the Corporation (s.24(1)). Each holds office for a period not exceeding five years as stated in the order of appointment, and can be reappointed if otherwise qualified (s.24(2)). A person who has a disqualification under section 8 cannot be appointed (s.24(5)). The Central Government may remove either officer at any time, and must do so if a special meeting of the Corporation resolves it by not less than two-thirds of the total strength (s.24(6)).
Who the Principal Officers are
The "Corporation" in this Chapter is the Employees' State Insurance Corporation (ESIC), the body that runs the insurance scheme for employees in establishments covered by Chapter IV. For how the Corporation itself is constituted, see our explainer on sections 4 and 5. Section 24 deals with the executive side: the people who run it day to day.
Employers meet the Corporation mainly through ESI and PF registration and monthly contributions, and it is these officers who head the machinery behind both.
Section 24(1) says the Central Government may appoint the two officers. The word "may" matters. The Code does not compel an appointment, but the Director General and the Financial Commissioner are the only offices the Code names as Principal Officers.
Sub-section by sub-section
| Sub-section | What it provides |
|---|---|
| 24(1) | Central Government may appoint a Director General and a Financial Commissioner as Principal Officers |
| 24(2) | Term not exceeding five years as specified in the order; outgoing officer eligible for reappointment if otherwise qualified |
| 24(3) | Salary and allowances as prescribed by the Central Government |
| 24(4) | Powers and duties as prescribed by the Central Government, plus other functions specified in the regulations |
| 24(5) | Disqualified if subject to any disqualification in section 8 |
| 24(6) | Removal by the Central Government at any time; mandatory on a two-thirds resolution of the Corporation |
| 24(7) | Corporation may employ other officers and employees; Central Government sanction needed to create a post above a prescribed maximum monthly salary |
| 24(8) | Recruitment and service conditions follow Central Government rules for corresponding pay scales |
| 24(9)-(10) | Group A and Group B equivalent posts (other than medical, nursing or para-medical) filled in consultation with the UPSC |
Term, pay and removal
The term is set by the appointment order and cannot exceed five years. There is no fixed minimum. An outgoing Director General or Financial Commissioner can be appointed again, but only if still qualified.
Pay and allowances are "such as may be prescribed by the Central Government" (s.24(3)). The Central Rules, 2026 do this in rule 14: they provide that the Director General and the Financial Commissioner receive pay, allowances and other benefits admissible to Central Government officers drawing the corresponding level of pay. Where the officer is already in the Corporation's service, rule 14(1) preserves the pension, gratuity and superannuation benefits he would otherwise have had. The same rule describes the powers: the Director General acts as Chief Executive Officer, convenes meetings under the orders of the Chairperson and enters into contracts; the Financial Commissioner, under the Director General's control, maintains accounts, prepares the budget and arranges internal audit. These are rule-level details, so read them with the Code. The Central Rules apply because the Central Government is the appropriate Government for the Corporation. Where a State Government is the appropriate Government for an establishment, the State's own rules apply to that establishment.
Removal has two routes. The Central Government may remove either officer at any time under s.24(6). Separately, if the Corporation passes a resolution at a special meeting called for the purpose, supported by votes of not less than two-thirds of its total strength, the Government shall remove the officer. Note "total strength", not the members present on the day.
Disqualification
Section 24(5) cross-refers to section 8, the disqualification provision for members of the Social Security Organisations. Anyone caught by section 8 cannot be appointed as, or for being, the Director General or Financial Commissioner. We explain section 8 in our sections 8 and 9 article.
Staff of the Corporation
Section 24(7) lets the Corporation employ the officers and employees it needs, including for responsibilities the Central Government assigns from time to time. The proviso is a control: the sanction of the Central Government is required to create any post whose maximum monthly salary exceeds a limit the Central Government prescribes. Rule 14(4) gives that limit as posts carrying a maximum of level 14 in the pay matrix of the Seventh Central Pay Commission.
Section 24(8)(a) ties recruitment, salary, discipline and other conditions of service to the regulations, in accordance with the rules and orders for Central Government employees in corresponding pay scales. Three provisos follow:
- medical specialists and super specialists in notified posts get terms similar to equivalent posts in the All India Institute of Medical Sciences, Post Graduate Institutes or similar Central institutions;
- a departure from the Central Government rules needs the Central Government's prior approval;
- the sub-section does not apply to consultants and specialists engaged on contract.
If there is doubt when fixing corresponding pay scales, the Corporation refers the matter to the Central Government, whose decision is final (s.24(8)(b)).
UPSC consultation
Under s.24(9), appointments to posts corresponding to Group A and Group B Gazetted posts under the Central Government (other than medical, nursing or para-medical posts) are made in consultation with the Union Public Service Commission. The exception is an officiating or temporary appointment not exceeding one year, which gives no claim to regular appointment and does not count for seniority or the minimum qualifying service for promotion. Any question whether a post corresponds to Group A or B goes to the Central Government, and its decision is final (s.24(10)).
What this means for employers
Section 24 creates no compliance duty for an employer or a payroll team. It matters for context. It tells you who answers for the Corporation's decisions on registration, contribution and benefits, and how the Corporation is held accountable. For the practical side, such as registering employees and paying contributions, see the sections that follow.
Need help with ESI registration and compliance?
Section 24 is about the Corporation's own management, but the decisions its officers take reach every employer with insured employees. If you are unsure whether your establishment must register or how to register under ESI and PF, we can review your employee data and walk you through the steps.
Key takeaways
- The Central Government may appoint a Director General and a Financial Commissioner as the Principal Officers of the ESI Corporation.
- Each serves for a period not exceeding five years, stated in the order, and can be reappointed if otherwise qualified.
- Section 8 disqualifications apply to these posts.
- Removal is possible at any time, and mandatory on a two-thirds resolution of the Corporation's total strength.
- Staff recruitment follows Central Government norms; new posts above the prescribed salary need Central sanction, and Group A and B equivalent posts need UPSC consultation.
Read next
- Sections 4 and 5: Central Board and the Employees' State Insurance Corporation
- Sections 25, 26 and 27: ESI Fund, expenditure and property
- ESI under the new Labour Codes
- ESI registration eligibility criteria
Disclaimer: Based on the Code on Social Security, 2020 (as enacted) and, where noted, the Code on Social Security (Central) Rules, 2026 (G.S.R. 344(E), 8 May 2026), as on 30 September 2026. The Code is in force from 21 November 2025; some provisions may be notified later, and State Governments make their own rules for establishments where the State is the appropriate Government. Verify the current position before acting.