Employees’ State Insurance Act, 1948

Employees’ State Insurance Act, 1948 An Act to provide for certain benefits to employees in case of sickness, maternity and employment injury and to make provision for certain other matters in relation thereto. In short, insurance. Benefits Medical benefit Sickness benefit Maternity benefit Disablement benefit Dependants benefit Funeral expenses Rehabilitation allowance This fund is managed by the ESI Corporation (ESIC) according to rules and regulations stipulated there in the ESI Act 1948, which oversees the provision of medical and cash benefits to the employees and their family. ESI scheme is a type of social security scheme for employees in the organised sector. The employees registered under the scheme are entitled to medical treatment for themselves and their dependents, unemployment cash benefit in certain contingencies and maternity benefit in case of women employees. In case of employment-related disablement or death, there is provision for a disablement benefit and a family pension respectively. Outpatient medical facilities are available in 1418 ESI dispensaries and through 1,678 registered medical practitioners. Inpatient care is available in 145 ESI hospitals and 42 hospital annexes with a total of 19,387 beds. In addition, several state government hospitals also have beds for the exclusive use of ESI Beneficiaries. Cash benefits can be availed in any of 830 ESI centres throughout India. (As per latest data) Applicable to non-seasonal factories/shops employing 10 or more persons having gross salary of less than Rs. 21,000 a month. (Gross salary includes Basic + Dearness Allowance + all other Allowances such as House Rent Allowance, Leave Travel Allowance etc) The act was initially intended for factory workers but later became applicable to all establishments having 10 or more workers. Once a factory or an Establishment is covered under the Act, it continues to be covered notwithstanding the fact that the number of persons/ coverable employees employed therein at any time falls below the required limit or there is a change in the manufacturing activity. As per the latest amendment, Registration of new employee is required to be done within 10 days from the Date of Appointment. Employer Contribution is 3.25% of Gross Salary; Employee Contribution is 0.75% of Gross Salary Question: What are the contribution periods and benefit periods? Answer: The financial year from April to March has been divided into two six monthly contribution periods i.e. 1st April to 30th September and 1st October to 31st March of next year. The relevant benefit period corresponding to each contribution period commences three months after the end of the that contribution period i.e. Jan to June and July to December (The calendar year from January to December has been divided into two six monthly benefits periods). Question: If the wages of an employee exceeds Rs. 21,000 in a month, can he be treated as not covered and deduction of contribution from his wages is stopped? Answer: If the wages of an employee (excluding remuneration for overtime work) exceeds the wage limit prescribed by the Central Government after start of contribution period, he continues to be an employee till the end of that contribution period and hence contribution is to be deducted and paid on the total wages earned by him. Question: If the insured person's family is residing in another place in the same State or another State, how the family can avail the medical benefit? Answer: If the family is residing in any other place either in the same State or a different State, based on the declaration of the insured person and certified by the employer, the family is provided with a 'Family Identity Card' for receiving medical benefit from ESI Dispensary in the area in which they are residing. After the commencement date of operation of IT Roll Out w.e.f. 9.6.2011 the 'Family' is also issued a separate 'Pehchan card'. By producing this Aadhar based Pehchan card, the family can avail the medical benefit from any ESI Dispensary/ Hospital either at their place of residence or in any other part of the country. Relaxation in eligibility criteria and enhancement in the payment of relief under Atal Bimit Vyakti Kalyan yojana: ESIC is implementing the Atal Bimit Vyakti Kalyna Yojna under which unemployment benefit is paid to the workers covered under ESI Scheme. The ESI Corporation has decided to extend the scheme for one more year upto 30th June 2021. It has been decided to relax the existing conditions and the amount of relief for workers who have lost employment during the Covid-19 pandemic period. The enhanced relief under the relaxed conditions will be payable during the period of 24.03.2020 to 31st December 2020. Thereafter the scheme will be available with original eligibility condition during the period 01.01.2021 to 30.06.2021. Review of these conditions will be done after 31.12.2020 depending upon the need and demand for such relaxed condition. The eligibility criteria for availing the relief has also been relaxed, as under: A. The payment of relief has been enhanced to 50% of average of wages from earlier 25% of average wages payable upto maximum 90 days of unemployment. B. Instead of the relief becoming payable 90 days after unemployment, it shall become due for payment after 30 days. C. The Insured Person can submit the claim directly to ESIC Branch Office instead of the claim being forwarded by the last employer and the payment shall be made directly in the bank account of Insured Person. D. The Insured Person should have been insurable employment for a minimum period of 2 years before his/her employment and should have contributed for not less than 78 days in the contribution period immediately preceding to unemployment and minimum 78 days in one of the remaining 3 contribution periods in 02 years prior to unemployment. Question: We have more than 10 employees in our company and we have taken Medical Insurance from a private company. Is it still mandatory to register our company for ESI? Answer: Yes, as per law it is mandatory to get ESI number the moment the number of employees crosses 10, whether or not the company has taken private medical insurance and whether or not their salaries are more than INR 21000 per month. Extra Reading Material: https://www.esic.nic.in/attachments/files/faq.pdf