Esi act-1948 employees state insurance act

The Employees
State Insurance
Act,1948

Preliminary
 Object of the act:
To provide for certain benefits to
employees in case of sickness,
maternity and injury during employment
and to make provision for certain other
matters in relation thereto.

Preliminary
 Applicability of the Act:
 All factories
 Shops employing 20 or more persons.
 Such other Govt. specified
establishments.

Act does not apply to:
 Seasonal factories engaged exclusively in any of the
activities like: cotton ginning, cotton or jute pressing,
decoration of ground nuts, manufacturing coffee, indigo,
lac, rubber, sugar, or tea or any manufacturing process
incidental to or connected with any of the afore said
activities, and including factories engaged for a period
not exceeding seven months in a year in blending,
packing or repackaging tea or coffee, or in such other
processes as may be specified by the central govt.
 The factories exempted as seasonal from the
provisions of the act.

Act does not apply to:
 Mines
 Railway running sheds
 Govt. factories or establishments and Indian
naval, military, or air force
 Other Govt. notified exempted establishments

ACT AUTHORISATION
 1. To Promote and measure for health and
welfare of INSURED EMPLOYEES (IE)
 2. Intervene for the rehabilitation and re-
employment for disabled / injured
 3. To appoint inspectors for purposed of the
act
 4. To determine the amount of contribution
and relevant verification

Standing committee
 empowered to-
 1. Shall administer the affair of the corporation
 2. Shall submit the consideration and decision
of the corporations
 3. Have discretion on other issues of
corporation

Medical Benefit Council
 1. Advise to administration on Medical
Benefit, purpose of grants and related
matter
 2. Have power and duties of
INVESTIGATION on Empanelled
Medical practitioner, its treatment and
attendance
 3. Perform other duties

Inspectors- Duties- Powers
 Duties  -
 1.  Inquiring into the correctness in any return of contribution
 2. Ascertaining Provision of the Act has been complied
 3. Other authorized / specified duties by the corporation.
 Powers -
 1. To collect require and relevant information of employer /
contractor or both
 2. To enter org / contractor premises at reasonable time and
examined relevant account books and relevant documents,
payment of wages etc.
 3. To examine employer, contractor, his agent  / servant or
IE in factory / office
 4.  To  make copies of extracts from any registrar, account
books and other books of maintenance of org.

Employer/ Employee’s Contribution
 It is the principle employer’s responsibility to deposit his
own as well as employee’s contribution in respect of all
employees including the contract labour, into the E.S.I.
Account. Non-availability of funds cannot be a ground for
non-payment of contributions under the act. There is no
provision to waive the contribution, damages and interest
 The employer is required to contribute at the rate of 4.75%
of the wages paid/ payable in respect of every wage period.
The employees are also required to contribute at the rate of
1.75% of their wages except when the “average daily
wages in a wage period” are equal to or less than Rs.40.

Employer/ Employee’s Contribution
 The employer should get his factory or
establishments registered with the E.S.I.
Corporation within 15 days after the Act
becoming applicable to it, and obtain the
employer’s Code Number. The regional officer
will allot a code number to the employer, which
must be quoted in all documents and
correspondence.

Benefits available to insured
employee
 The purpose of the Employee State Insurance Act is
to provide benefits as detailed in the Act particularly in
section 46, to the insured persons or their
dependants.
 The following benefits are provided under section 46.
1. Sickness benefit
2. Maternity benefit
3. Disablement benefit
4. Dependents benefit
5. Medical benefit
6. Funeral expenses

Sickness benefit
 Every insured employee is entitled to the cash benefit for the period
of sickness certified by a duly appointed medical practitioner if the
contributions in respect of him were payable for not less than 78
days in the corresponding contribution period.
 Cash benefit takes the form of periodical payment made to an
insured person which is payable for maximum numbers of 91 days in
any two consecutive benefit periods. The benefit is not paid for the
first two days of sickness which is treated as the waiting period.
 Insured persons suffering from long term diseases like T.B., leprosy,
mental, heart etc. and who have been continuous employment for
two years are entitled to get sickness benefit period up to 309 days.

Maternity benefit
 A periodical cash benefit is payable to an insured
woman employee, in cash of confinement, miscarriage,
medical termination of pregnancy, premature birth of a
child or sickness arising from pregnancy etc.
 If the contributions in respect of her were payable for at
least 70days in the two immediately preceding
contribution periods
 The benefit is payable of twice the standard benefit
rate or Rs.20, whichever is higher for all days on which
she does not work during the prescribed period.

Disablement benefit
 It is payable to an employee who is injured in the
course of his employment and is permanently or
temporarily disabled or contacts any occupational
disease.
 A person who sustains temporary disablement for not
less than 3days(excluding the day of accident) shall be
entitled to periodical payment as may be prescribed by
the central govt.
 The benefit of temporary disablement is, however, not
payable for any day on which the employee works,
remains on lease, holiday or strike in respect of which
he receives wages.

Dependents benefit
 If any employee dies during any period for
which he is entitled to a cash benefit, the
amount of such benefit shall be payable up
to & including the day of his death.
 The amount of benefit shall be paid to the
nominee or, where there is no nomination, to
the heir or legal representative of the
deceased employee.

Medical benefit
 An insured person or a member of his family whose
condition requires medical treatment and attendance
entitled to receive medical benefit.
 Rs.250 on account of confinement expenses shall be
paid to an insured person or his wife if confinement
occurs at a place where necessary medical facilities
under E.S.i.C. schemes are not available.
 Employer not to dismiss or punish employee during
period of sickness- section73.

Funeral Expenses
 If an insured employee dies, the eldest serving
member of his family is entitled to
reimbursement of such expenditure subject to
maximum of Rs.2500 (W.E.F.
December,2000)
 The claim for the funeral expenses should be
submitted with prescribed document and form
within three months of the death of the insured
employee.

Adjudication of dispute &
claims
 Employees Insurance Court
 Institutions of proceedings, etc.
 Powers of employees’ Insurance Court
 Reference to High Court
 Appeal
 Stay of payment during pending of appeal

Offences and penalties
 Punishment for false statement:- In this case any
false statement or false representation, shall be
punishable with imprisonment up to Rs.2000 or with
both
 Punishment for failure to pay contributions:- if any
person fails to pay any contribution which under to this
act he is liable to pay, he shall be punishable with
imprisonment up to three years.
 Punishment for other contravention:- in
contraventions like dismisses, discharges, reduces or
otherwise punishes an employee, shall be punishable
with imprisonment up to one year or with fine up to
Rs.4000 or with both

Offences and penalties
 Power to recover damages:- If employer fails to pay
the amount of contribution then corporation may
recover from the employer by way of penalty.
 Power of court to make orders:- If court makes order
for employer- if employer is not able to make this order
within period then employer shall be punishable with
imprisonment in respect thereof U/S.85 and shall also
be liable to pay fine up to Rs.1000 for everyday.

Miscellaneous Provisions
 Exemption of a factory or establishment (sec.87Exemption of a factory or establishment (sec.87)
 Exemption may be granted to any factory or establishment
for maximum period of one year.
 Any exemption granted shall be notified by the notification
in the Official Gazette.
 The appropriate Govt. while granting exemption can
improve any terms and conditions upon the
factory/establishment.
 If required any exemption can be renewed for max. one year
 Before granting any exemption Corp. must be given
opportunity to make representation which has to be
considered by the Govt.

Exemption of persons or class ofExemption of persons or class of
persons (sec.88)persons (sec.88)
 App. Govt. is authorized to exempt any person or class of
person from the operation of the act
 Any exemption granted shall be notified by the notification in the
Official Gazette.
 Such person or class of persons must be working in a
factory/establishment
 Any exemption granted shall be accompanied with such conditions
as the appropriate Govt. may think fit to impose

Exemption of a factory or establishment
belonging to Govt./any local authority
 App.Govt. must consult the Corporation
 Exemptions shall always be subj. to the conditions imposed
by the Govt.
 Exemptions shall always be in order only if the employees in
any such factory/establishment are already in receipt of
benefits substantially similar or superior to the benefits
provided under this act.

Exemption from one or more provisions of
the act (sec.91)
 Exemption may be granted to any factory or establishment
or any person or class of person by App.Govt.
 Any exemption granted under the sec.87,88,90 or 91 in
respect of any person or class of person may be enforced
either prospectively or retrospectively the date of its
enforcement has to be specified (sec.91-A)

Obligation of the Employers …
1). Get your Factory / establishment registered with in 15 days
after the Act becomes applicable. Submit Form 01 to the
Regional office for this purpose. Obtain Employer’s code No.
for use in all ESIC Forms / documents and correspondence
with the offices of the ESI Corporation.
2). Fill up Declaration Forms in respect of all coverable
employees and submit the same to the Regional Office/ Local
Office of the corporation well before the ‘Appointed Day’ and
obtain insurance Numbers from the concerned Local Office/
Regional Office, In respect of newly appointed employees, fill
up the declaration form soon after appointment of such
employees and submit the same to the Local Office
Concerned.

3). Pending receipt of identity cards/ identity certificates
you may issue “certificate of employment” in Form 86 to
the covered employee(s) enabling them to avail
cash/medical Benefits
4). Pay ESI contribution (Employee's Share @4.75% and
the Employer’s share @ 1.75% of the wages) with in 21
days of the month following, in which the wages fall
due.
5).Maintain an Accident Book as prescribed under
the Factory Act / ESI Act.

6).Submit an Accident Report to the Local Office /
ESI Dispensary concerned immediately in
respect of accidents that could result in death or
disablement and within 24 hours of its
occurrence otherwise. Minor accidents which do
not cause absence from work need not be
reported
7).Grant leave to insured employees on the basis
of sickness certificates issued by any authorized
ESI doctor.

Esi act-1948 employees state insurance act

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Esi act-1948 employees state insurance act