Employees' State Insurance

Employees' State Insurance (ESI, Hindi: ) is a self-financing social security and health insurance scheme for Indianworkers. For all employees earning 15,000 or less per month as wages, the employer contributes 4.75 percentage and employee contributes 1.75 percentage, total share 6.5 percentage. This fund is managed by the ESI Corporation (ESIC) according to rules and regulations stipulated therein the ESI Act 1948, which oversees the provision of medical and cash benefits to the employees and their family through its large network of branch offices, dispensaries and hospitals throughout India. ESIC is an autonomous corporation under Ministry of Labour and Employment, Government of India. But most of the dispensaries and hospitals are run by concerned state governments. The ESI Act was enacted in India in 1948, but come in to reality from 25.02.1952 started at Kanpur and [1]:1 Delhi. Initially intended for workers working in factories and companies only. It now applicable to all all establishments having 10 or more workers including educational institutions, hospitals, etc., covering 15.5 million employees working with about 450,000 employers. Total beneficiaries as of 2011-12 are above [2]:13[3] 65.5 million. [edit]Benefits In ESI scheme, a worker in insurable employment is called insured person (IP). Insured persons and their family are entitles to different types of benefits. The benefits are broadly classified into two: (1) Medical benefit and (2) cash benefit. The employees registered under the scheme are entitled to medical treatment for themselves and their dependants, unemployment cash benefit in certain contingencies, andmaternity benefit in case of women employees. In case of employment-related disablement or death, there is provision for a disablement [1]:67 benefit and a family pension, respectively. Funeral Benefit to dependants of Insured Persons/Insured Women. Super Speciality Treatment through Private Tie Up Network as well as through its own Super Speciality Hospitals situated throught out India. Also ESI is constructing Medical and PG Medical, Dental Colleges in which it has set aside cetain percentage of seats for children of persons having ESI coverage. Recently ESI taken a decision to make the dependant benefit to a ceiling of Rs.1200 for all eligible dependants of a deceased person. Through approximately 86000 dependants got benefit. From time to time ESI is relaxing conditions for disbursement of Sickness Benefit and Super Speciality Treatment. Outpatient medical facilities are available in 1398 ESI dispensaries, and through 1678 empanelled private medical practitioners. Inpatient care is available in 145 ESI Hospitals and 42 Hospital annexes; a total of 19387 beds. In addition, several state government hospitals also have beds for exclusive use of ESI [2]:13,16 Beneficiaries. Cash benefits can be availed in any of 783 ESI centres located throughout India. Recent years have seen increasing role of information technology in ESI, with the introduction [2]:8[4] of Pehchan smart cards in 'Project Panchdeep', India's largest e-governance project. In addition to insured workers, poor families eligible under the Rashtriya Swasthya Bima Yojana can also avail facilities in ESI hospitals and dispensaries. There are plans to open medical, nursing and paramedical schools in [2]:8[3] ESI hospitals. Director General of ESIC is Shri Anil Kumar Agarwal, IAS; Financial Commissioner is Shri Sh.S.K.G Rahate, IAS; Medical Commissioner is Dr. S.R. Chouhan while Insurance Commissioner is Shri B. K. Sahu.

In Delhi, ESIC runs a number of dispensaries (approx 32) and four hospitals. The hospitals run by ESIC in Delhi are as follows: 1. ESIC Model Hospital, Basaidara pur, Ring Road(Near Panjab Bagh)New Delhi-110015 2. Indira Gandhi ESI Hospital, Jhilmil, Delhi-110032 3. ESI Hospital, Sector-15, Rohini, New Delhi-110085 4. ESI Hospital,Ma Anand mai Marg, Phase-I,Okhla Industrial Area,New Delhi-110021

THE EMPLOYEES' PROVIDENT FUND AND MP ACT, 1952

The Employees' Provident Funds and Miscellaneous Provisions Act, 1952 is enacted to provide a kind of social security to the industrial workers. The security, however, differs from the security provided to them under the Workmen's Compensation Act or the Employees' State Insurance Act. The Employees' Provident Funds and Miscellaneous Provisions Act mainly provides retirement or old age benefits, such as Provident Fund, Superannuation Pension, Invalidation Pension, Family Pension and Deposit Linked Insurance. Provision for terminal benefit of restricted nature was made in the Industrial Disputes Act, 1947, in the form of payment of retrenchment compensation. But this benefit is not available to a worker on retirement, on reaching the age of superannuation or voluntary retirement. The Employees' Provident Funds and Miscellaneous Provisions Act is intended to provide wider terminal benefits to the industrial workers. For example, the Act provides for payment of terminal on reaching the age of superannuation, voluntary retirement and retirement due to incapacity to work. CHECK LIST Eligibility Any person who is employed for work of an establishment or employed through contractor in or in connection with the work of an establishment. Payment of Contribution The employer shall pay the contribution payable to the EPF, EDLI and Employees' Pension Fund in respect of the member of the Employees' Pension Fund employed by him directly by or through a contractor. It shall be the responsibility of the principal employer to pay Applicability Establishment which is factory engaged in any industry specified in Schedule 1 and in which 20 or more persons are employed. Any other establishment employing 20 or more persons which Central Government may, by notification, specify in this behalf. Any establishment employing even less than 20 persons can be covered voluntarily under section 1(4) of the Act. Benefits Employees covered enjoy a benefit of Social Security in the form of an unattachable and unwithdrawable (except in severely restricted circumstances like buying house, marriage/education, etc.) financial nest egg to which employees and employers contribute equally throughout the

the contributions payable to the EPF, EDLI and Employees' Pension Fund by himself in respect of the employees directly employed by him and also in respect of the employees employed by or through a contractor. Clarification about Contribution After revision in wage ceiling from Rs.5000 to Rs.6500 w.e.f. 1.6.2001 per month, the government will continue to contribute1.16% upto the actual wage of maximum Rs.6500 per month towards Employees Pension Scheme. The employers share in the Pension Scheme will be Rs.541 w.e.f. 1.6.2001. Under Employees Deposit-Linked Insurance Scheme the contribution @ 0.50% is required to be paid upto a maximum limit of Rs.6500. The employer also will pay administrative charges @ 0.01% on maximum limit of Rs.6500 whereas an exempted establishment will pay inspection charges @ 0.005% on the total wages paid. Notes: The above clarification is given by taking wages upto a maximum of Rs.6500 towards wage (basic+DA). Since an excluded employee i.e. drawing wages more than Rs.6500 can also become member of the Fund and the Schemes on joint request and if, for instance, such an employee is getting Rs.10, 000 per month, his share towards provident fund contribution will be Rs.1200 e.g. 12% and employers share towards provident fund contribution will be Rs.659 and Rs.541 towards Employees Pension Fund.

covered persons employment. This sum is payable normally on retirement or death. Other Benefits include Employees Pension Scheme and Employees Deposit Linked Insurance Scheme. Rate of Contribution Scheme Employee's Employer's Amount>8.33% (in case where contribution is 12% of 10%) 10% (in case of certain Establishments as per details given earlier) 0.5% 8.33%(Diverted out of Provident Fund Central Govt.

Provident Fund Scheme Insurance Scheme Pension Scheme

12%

NIL

NIL NIL

NIL 1.16%

Damages Less than 2 months

@ 17% p.a.

Two months and above but less than upto four @ 22% months p.a. Four months and above but less than upto six months Six months and above @ 27% p.a.

Penal Provision Liable to be arrested without warrants being a cognizable offence. Defaults by employer in paying contributions or inspection/administrative charges attract imprisonment upto 3 years and fines upto Rs. 10,000.00 {Section 14} For any retrospective application, all dues have to be paid by employer with damages upto 100% of arrears.

THE EMPLOYEES' STATE INSURANCE ACT, 1948

The Employees State Insurance Act, 1948, provides to workers not only accident benefit but also other benefits such as sickness benefit, maternity benefit and medical benefit. Wage Ceiling: Every employee drawing wages upto Rs. 15000.00 per month is required to be insured under the Act. Objective of the Act: The object of the Act is to secure sickness, maternity, disablement and medical benefits to employees of factories and establishments and dependents benefits to the dependents of such employees. Applicability:-Section 2(9) 'employee' under ESI means any person who is engaged/employed for wages/salary in connection with the work of the establishment to which this Act applies. But does not include any person whose wages (excluding OT) exceed the limit prescribed by the Central Govt. (which is 15000 pm now with effect from 1 May 2010). Section 2(12) 'establishment/factory' under ESI means any premises whereon 20 or more persons are employed or were employed for wages. If you combine both, you understand that if the total employees are 25 but out of which 14 are drawing gross more than 15000 pm, then only 11 employees come under ESIS and the criteria for 20 employees does not fulfill. Hence on above grounds it is not covered. CHECK LIST

Applicability of the Act & Scheme: Is extended in area-wise to factories using power and employing 10 or more persons and manufacturing units and establishments employing 20 or more person upto Rs.15,000/- per month with effect from 01-May-2010. It ha ed upon shops, hotels, restaurants, roads motor transport undertakings, equipment maintenance staff in the hospitals. Coverage of Employees Drawing wages upto Rs. 15000.00 per month engaged either directly or through contractor Rate of contribution of the wages Employer's 4.75% Employee's 1.75% The ESI Scheme Today No. No. No. No. No. No. No. No. of of of of of of of of implemented Centres Employers covered Insured Persons Beneficiaries Regional Offices/SROs ESI Hospitals/Annexes ESI Dispensaries Panel Clinics 677 2.38 lacs 85 lacs 330 lacs 26 183 1453 2950

Benefits to employe

Medical, sickness, extended sickness fo diseases, dependents maternity, besid expenses, rehabilitation allowance, me insured person and his or her spouse.

WAGES FOR ESI CONTRIBUTIONS Registers / Files to be maintained by the employers

Manner and Time Limit for makin Contribution

To be deemed as wages Basic pay Dearness Allowance House Rent Allowance City Compensatory Allowance Overtime Wages (but not to be taken into account for determining the coverage of employee) Payment for day of rest Production Incentive Bonus other than statutory bonus

Not to be deemed as Wages Contribution paid by the employer to any pension / provident of under ESI Act. Sum paid to defray special expenses entailed by the nature of employment Daily allowance paid for the period spent on tour. Gratuity payable on discharge Pay in lieu of notice of retrenchment compensation

The total amount of contribution (employe employer's share) is to be deposited with t through a challan in the prescribed form in or before 21st of month following the calen which the wages fall due.

Contribution Period

Night shift Allowance Heat, Gas & Dust Allowance Payment for unsubstituted holidays Meal / Food Allowance Suspension Allowance Lay off Allowance Children Education Allowance (not being reimbursement for actual tuition fees

Benefits paid under the ESI Scheme Encashment of leave Payment of Inam which does not form part of the term of employment Washing Allowances for livery Conveyance amount towards reimbursement for duty related journey

If the person joined insurance employmen say on 5th January, his first contribution 5th January to 31st March and his corresp will be from 5th October to 31st December. 1st April to 30th September 1st October to 31st March

Penalties: Different punishment have been prescribed for different types of offences in terms of Section 85: (i) (six month and fine Rs.5000), (ii) (one year imprisonment and fine), and 85-A: (five years imprisonment and not less to 2 years) and ESI Act, which are self explanatory. Besides these provisions, action also can be taken under section 406 of the IPC in cas employer deducts contributions from the wages of his employees but does not pay the same to the corporation which amo breach of trust.