EMPLOYEES’ STATE INSURANCE ACT, 1948

JAIPURIA INSTITUTE OF MANAGEMENT,LUCKNOW

INTRODUCTION This Act came into being on 19th April, 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.

This Act covers a wider spectrum than the Factories Act.

Extensive regulations have been framed under the Act to identify the employees who would be entitled to the benefits.

An elaborate machinery is provided for the effective administration of the Act.

OBJECTIVES The basic objective is to offer social insurance to

workers.

The ESI Act is a social welfare legislation enacted with the object of providing certain benefits to employees in case of sickness, maternity and employment injury.

The objective of the act is to secure sickness, maternity and medical benefits to employees of factories and establishments and dependents benefits to the dependents of such employees.

OBJECTIVES CONTINUED…. To attain the goal of socio-economic justice for securing, the

right to work, to education and public assistance in cases of unemployment, old age, sickness and disablement.

To make employee comfortable in the office by giving medical relief, cash benefits, maternity benefits, pension to dependents of deceased workers and compensation for fatal or other injuries and diseases.

CONTINGENSIES SICKNESS EMPLOYMENT INJURY CHILD BIRTH

COVERAGE This act was applicable to all non-seasonal factories

using power and employing 20 or more workers.

But is now applicable to non-seasonal factories using power and employing 10 or more workers and non power using factories employing 20 or more workers.

It covers all type of workers whose wage limit does not exceed Rs. 15000 per month.

EXEMPTIONS The provisions of the ESI Act are not applicable to

factories or establishments, run by the State Governments / Central Government, whose employees are, otherwise, in receipt of social security benefits substantially similar or superior to the benefits provided under the ESI Act.

The "Appropriate Government", may grant or renew exemption under Section 87 of the ESI Act in respect of a Factory/Establishment or class of factories or establishments in any specified area from the operation of the Act for a period not exceeding one year at a time.

EXEMPTIONS CONTINUED…. Exemption Under Section 88 of the Act is granted by the

"Appropriate Government" to employees, or class of employees, who remain away from their Hqrs. for more than 7 months in a year, and those employees who are posted in non-implemented areas.

No exemption, under Section 87, or Section 88 can be granted unless a reasonable opportunity has been given to the Corporation to make any representation and the same is considered by the "appropriate Government".

Exemption Under Section 90 can be granted to a factory / establishment belonging to any local authority such as a Municipality / Corporation, etc. if employees in any such factory/establishment are otherwise in receipt of benefits substantially similar or superior to the benefit. provided under the Act.

ADMINISTRATION The Employees’ State Insurance Scheme is administered

by a Corporate body called the Employees’ State Insurance Corporation (ESIC), which has members representing employers, employees, the Central Government, State Governments, medical profession and the Parliament.

The Corporation, with its Central Headquarters at New Delhi, operates through a network of 52 Regional, Sub- Regional and Divisional Offices located in various States.

The medical benefit is taken care of by the respective state government.

PROVISIONS

INSURED PERSON IN CASE OF SICKNESS

INSURED WOMAN IN CASE OF MISCARRIAGE OR CONFINEMENT

TO AN INSURED PERSON SUFFERING FROM DISABLEMENT DUE TO EMPLOYMENT INJURY

TO DEPENDANTS OF AN INSURED PERSON WHO DIES DUE TO EMPLOTMENT INJURY

PROVISIONS CONTINUED….Sickness Benefit: The qualification of a person to claim sickness

benefit, the conditions subject to which such benefit may be given, the rate and period thereof shall be such as may be prescribed by the Central Government.

ESI Scheme provides medical care via a network of ESI dispensaries, hospitals, diagnostic centers, etc.

PROVISIONS CONTINUED….Sickness Benefit (Eligibility): MINIMUM 78 DAYS CONTRIBUTION IN ONE

CONTRIBUTION PERIOD. DAILY RATE OF SICKNESS BENEFIT IS 50 % OF DAILY

WAGES. EXTENDED SICKNESS BENEFIT (ESB) IS A CASH

BENEFIT PAID FOR PROLONGED ILLNESS DUE TO ANY OF THE 34 DISEASES SPECIFIED IN ANNEXURE-A.

ESB REQUIRES CONTINUOUS EMPLOYMENT OF 2 YEARS AND CONTRIBUTION OF AT LEAST 156 DAYS IN 4 PRECEDING CONTRIBUTION PERIODS.

PROVISIONS CONTINUED….Maternity Benefit: The qualification of an insured woman to claim

maternity benefit, the conditions subject to which such benefit may be given, the rates and period thereof shall be such as may be prescribed by the Central Government.

The contribution condition is same as for sickness benefit.

Daily benefit rate is double of sickness benefit. Benefit is paid for Sundays also.

PROVISIONS CONTINUED….Maternity Benefit (Eligibility): Delivery- A total period of 12 weeks beginning not

more than 6 weeks before the expected date of child birth.

Miscarriage- 6 weeks following miscarriage. Sickness due to pregnancy, childbirth or

miscarriage- Additional period up to 4 weeks. Medical bonus of Rs. 2500/- if the woman does not

avail medical facility from an ESI hospital at the time of delivery.

Claim forms- 09 and 19.

PROVISIONS CONTINUED….Disablement Benefit:Subject to the provisions of this Act : a person who sustains temporary disablement for not

less than three days (excluding the day of accident) shall be entitled to periodical payment [at such rates and for such periods and subject to such conditions as may be prescribed by the Central Government.

a person who sustains permanent disablement, whether total or partial, shall be entitled to periodical payment [at such rates and for such periods and subject to such conditions as may be prescribed by the Central Government.

PROVISIONS CONTINUED….Disablement Benefit: Daily benefit for both temporary and permanent

illness is roughly equivalent to 100% of the wage rate.

The rate of benefit is proportional to the percentage of loss of earning capacity. Benefit is paid for Sundays also.

Forms: (a) Permanent disablement- Form 14 (b) Temporary- Form 09.

ACCIDENTS- SEC 51

ACCIDENT

Arising in course of employm

ent

Acting in breach of regulation

s

While meeting

emergency

While travelling

in employer’

s transport

While commuting to the place of

work and vice versa

PROVISIONS CONTINUED….Medical Benefit:Government shall provide for insured persons and their families in the , reasonable medical, surgical and obstetric treatment.Where the incidence of sickness benefit payment to insured persons is found to exceed the all-India average, the amount of such excess shall be shared between the Corporation and the Government in such proportion as may be fixed by agreement between them. The Corporation may enter into an agreement with a Government in regard to the nature and scale of the medical treatment that should be provided to insured persons and their families and for the sharing of the cost thereof and of any excess in the incidence of sickness benefit to insured persons between the Corporation and the Government.

PROVISIONS CONTINUED….Medical Benefit:In default of agreement between the Corporation and any Government as aforesaid, the nature and extent of the medical treatment to be provided by the Government and the proportion in which the cost thereof and of the excess in the incidence of sickness benefit shall be shared between the Corporation and that Government.The State Government may, in addition to the Corporation under this Act, with the previous approval of the Central Government, establish such organization (by whatever name called) to provide for certain benefits to employees in case of sickness, maternity and employment injury .

PROVISIONS CONTINUED….Medical Benefit: An insured person or (where such medical benefit is

extended to his family) a member of his family whose condition requires medical treatment and attendance shall be entitled to receive medical benefit.

Such medical benefit may be given either in the form of out-patient treatment and attendance in a hospital or dispensary, clinic or other institution or by visits to the home of the insured person or treatment as in-patient in a hospital or other institution.

PROVISIONS CONTINUED….Medical Benefit: A person shall be entitled to medical benefit during

any 1[period] for which contributions are payable in respect of him or in which he is qualified to claim sickness benefit or maternity benefit 2 [or is in receipt of such disablement benefit as does not disentitle him to medical benefit under the regulations

PROVISIONS CONTINUED….Dependant Benefit: A widow can receive this benefit on a monthly basis

for life or till her re-marriage. A son or daughter can receive this benefit till twenty

five years of age. Other dependants like parents including a widowed

mother etc. can also receive this benefit under certain conditions.

The first instalment is payable within a maximum of three months following the death of an insured person and therefore, on a regular monthly basis.

PROVISIONS CONTINUED….Other Benefit: Funeral expenses on death of an IP subject to a

maximum of Rs.5000/- payable at the Branch Office.. Free supply of physical aids and appliances Preventive health care services such as immunization,

family welfare services, HIV/AIDS detection, treatment etc.

Confinement expenses @ Rs. 2500/- is paid to an insured woman or in respect of the wife of an insured person in case the confinement occurs at a place where ESI medical facilities are not available.

Rajiv Gandhi Shramik Kalyan Yojana -

PENALTIESFails to pay contribution due:  Not less than one year imprisonment in case of

failure to pay the employees’ contribution deducted from employees’ wages and/ or fine of Rs. 10000/-.

Not less than six months imprisonment, in any other case and/ or fine of Rs. 5000/-.

Enhanced punishment (in certain cases after previous conviction by Court):

Punishment with imprisonment for a term which may extend to 2 years and with fine of Rs. 5,000/- .

If subsequent offence is for failure to pay contribution which under the Act is liable to pay for every such subsequent offence, be punishable with imprisonment for a term which may extend to 5 years but which shall not be less than 2 years and also liable to fine of Rs. 25,000/- .

EVALUATIONThe ESI Scheme has been criticized on following

grounds: Even within the organized sector, the coverage is low. The Scheme has not been popular among the employees

and union. The State Governments , too, have not shown much interest to implement the provisions.

Employees complained about the inappropriateness of facilities and benefits provided.

Additional funds had to be spend by employees for medicines which were not available in ESI dispensaries.

Delay in transfer of benefits to insured workers.

Thank YouPresented By:

Anjali Saxena (JL13PGDM068)Krati Gupta (JL13PGDM087)Riya Panjwani (JL13RM51)Nasar Ashraf (JL13PGDM030)Anita Sareen (JL13PGDM067)Rashi Kevlani (JL13PGDM098)Neelanshi Sachan (JL13PGDM031)Netri Agarwal (JL13PGDM092)Anvita Tiwari (JL13FS14)Ankita Mishra (JL13FS12)Kashish Khan (JL13PGDM024)Vipul Sinha (JL13FS63)