ESI ACT 1948 PPT.pptx

N JB

1. AMENDMENTS W A G E S L I M I T ‐ R S 21 And R s 2 5 00 for people with disability with Effect from 1 January 2017. It lowered the rate of contribution from 6.5 % to 4% effective from 1 July 2019. I n s p e c t o r s ‐ S oci a l S e c u r i t y o f f i c e r s F a m i l y ‐ e x t e n d e d E S IC T O O P E N ‐ M ED I C A L COLLEGE,PARAMEDICAL COLLEGE M ed ic al F a c i l i t i e s t o o th e r b e n e f ici a r i e s Third party participation, private parties

2. ESI Scheme … ESI Scheme for India is an integrated social security scheme tailored to provide Social Production to w o r k e r s a n d th e i r d e p e n d e nt s , i n t h e o r ga n is e d sector, in contingencies, such as Sickness, Maternity a n d D ea t h or D is a b l e m e n t d ue t o a n e m p l o y m e n t i nj u r y or O c c u p a t i o n a l h aza r d

3. COVERAGE … The ESI Act 1948 applies to Non – seasonal Factories using power in and Employing ten (10) or More persons Non – seasonal and non‐ power using factories and establishments employing twenty(20) or more persons Employees of the Factories and Establishments in receipt of wages not exceeding Rs.7500 /‐ Per month are covered under this Act.

4. WAGES FOR ESI CONTRIBUTIONS T O BE D EE M ED AS W A G ES Basic pay Dearness allowance House rent allowance City compensatory allowance Overtime wages (but not to be taken i n t o a cc o un t f o r d e t e rm i n i n g t h e coverage of an employee) Payment for day of rest Production incentive B o nu s o t h e r t h a n s t a t u t o ry b o nu s Ni gh t s h i f t a ll o w a n ce P a ym e n t f o r u n -s u b s t i t u t e d h o l i d a ys Meal / food allowance S u s p e n s io n a ll o w a n ce Lay off compensation C h i ld r e n e du c a t io n a ll owa n ce Heat, Gas & Dust allowance N OT T O BE D EE M ED AS W AGES C o n t r i bu t io n p a i d b y t h e e m p l o y e r t o a n y Sum paid to defray special expenses G r a t u i t y p a y a bl e o n d i sc h a r g e Pay in lieu of notice retrenchment B e n e f i t s p ai d und e r t h e ESI Sc h e me E n c a s h m e n t o f l ea v e Payment of Inam which does mean part of employment W a s h i n g a ll o w a n ce f o r l i v e ry Conveyance Amount towards r ei m bu rs e m e n t f o r du t y r e l a t e d j o u r n e y

5. W A G E S D e fi n e d … Wages means all remuneration paid or payable in cash to an employee, if the terms of the contract of employment, express or implied, were fulfilled and includes any payment to an employee in respect of any period of authorised leave, lock out, strike which is not illegal or l a y o ff a n d ot h e r a dd i t i o n a l r e m u n e r a t i o n , i f a n y , p a i d a t intervals not exceeding two months, but does not include :‐ Any contribution paid by the employer to any pension fund or Provident fund, or under this act; Any traveling allowance or the value of any traveling concession; Any sum paid to the person employed to defray special expenses entailed on him by the nature of his employment ; or Any gratuity payable on discharge.

6. WAGES Defined … All remuneration paid or payable in cash to an employee following from the term of employment (including agreement) express or implied. The periodicity of payment is not relevant in this case. Any additional remuneration even if not flowing from any agreement or settlement but paid at intervals not exceeding two months. The exceptions as provided in Clause (a) to (d) above. A n y r e m u n e r a t i o n p a i d o r p a ya b le u n d e r p a r a 1 a n d 2 i s w a g e s a n d c h a r g e a b le t o c o n t r i b u t i o n w h e r e a s a n y amount paid towards items mentioned in clause (a) to ( d ) a r e n o t w a g e s a n d t h e r e f or e n o c o n t r i b u t i o n is chargeable on the amount. T h e a b o v e d e f i n i t i o n h a s t h r e e p ar t s 3.

7. F i n a n c e s … The Scheme is primarily funded by contribution r a i s e d f r o m I n su r e d E m p l o y ee s a n d t h ei r e m pl o y e r s P a y a b l e s u c h as Employees’ Contribution – 1.75% of the Wages Employers’ Contribution – 4.75% of the Wages T O T A L ‐ 6 . 5 % o f t h e W a g e s Em p l o y ee s i n r e c e i p t o f a n a v e r a g e da i l y w a g e of R s . 4 0/‐ o r L e ss , a r e e x e m p t e d f r om P a y m e n t of th e ir share of contribution (w.e.f 8.4.00) but are entitled to a l l s oci a l s e c u r i t y b e n e f i t s u n de r t h e S c h e m e .

8. Contribution & Benefit Period … Employees covered under the ESI Act, are required t o p a y c o n t r i b u t i o n t o w a r d s t h e s c h e m e o n a monthly basis. A contribution period means a six month time span from 1 st April to 30 th September and 1 st October to 31 st March . C a s h b e n e f i t s u n d e r t he sc h e m e a r e g e n e r a l l y l i k e d with contributions paid. The benefit period starts three months after the closure of a contribution period. The two type of periods are elucidated below. Contribution Period 1 st April to 30 th September 1 st October to 31 st March Benefit Period 1 st January to 30 th June o f t h e f o l l o w i n g y ea r 1 s t J u l y t o 3 1 s t D e c .

9. ADVANTAGES OF EMPLOYERS … 1. Employers are absolved of their liabilities of providing medical facilities to employees and their dependents in kind or in the form of fixed cash allowance, reimbursement of actual expenses, lump sum grant or opting for any other medical insurance p ol ic y of l i m i t e d s c o p e u n l e s s it is a c o n t r a c t u a l o b l i g a t i on of t h e e m p l o y e r

10. A D V A N T A G E S O F E M P L O Y E R S … Em p l oy e r s a r e e x e m p t e d f r om t h e a pp l ica b i l i t y o f t h e : ‐ M a t e rn i t y B e n e f it A c t W o r k m e n 's ’ C o m p e n s a t ion A c t in respect of employee covered under the ESI Scheme 3). Em p l oy e r s h a v e t h e ir d i s p o s a l , a p r o d uc t i v i t y , w e l l s e c u r e d w o r k fo r c e , a n e ss e nt i a l i n g r e d i e n t f or b e tt e r productivity

11. A D V A N T A G E S O F E M P L O Y E R S … Employers are absolved of any responsibility in times of Physical distress of workers such as sickness, employment injury or Physical disablement resulting in loss of wages, as the responsibility of Paying cash benefits shits to the corporation in respect of insured employees Any sum paid by way of contribution under the ESI Act is deducted in computing ‘income’ u n d e r th e I n c o m e T a x A c t

12. Benefits to Employees … ESI Scheme Major Social Security Benefits in Cash and Kind include … Medical Benefit – for self & Family S i c k n e ss B e n e f i t – f or s e l f M a t e r n i t y B e n e f i t ‐ f or s e l f Disablement Benefit a). Temporary Disablement Benefit – for self b). Permanent Disablement Benefit – for self D e p e n d e n ts’ B e n e f i t – f or d ep e n d e n t s i n c a se of death due to employment injury

13. Benefits to Employees … In addition, the Scheme also provides some other need b a s e d b e n e f i t s t o i n s u r e d w o r k e r s . T h e s e a r e : i). Funeral Expenses – to a person who performs the last rites of IP ii ) . R eha bi l i t a t i o n all o w a n c e s – f o r se l f V o c a t i o n a l R eha bi l i tat i o n ‐ f o r se l f Old age Medicare – for self and spouse v). Medical Bonus – for insured women and I P ’ s wi f e

14. Medical Benefit … Medical Benefit means Medical care of IPs and their families, wherever covered for medical benefit. The Standard medical care consists of out‐door treatment, in‐patient treatment, all necessary drugs and dressing, pathological and radiological specialist consultation and care, ante‐natal and post natal care, emergency treatment etc., Out‐door medical care is provided at the state Insurance Dispensaries or Mobile Dispensaries m a nne d b y f u l l ‐ t i m e doc t o r s ( s e r v i c e ’ s y s t em ) or at the private clinics of Insurance Medical Practitioners (Panel System)

15. Medical Benefit … Insured worker and members of his family are eligible for medical care from the very first day of the worker coming under ESI Scheme. A worker who is covered under the scheme for first time is eligible for medical care for the period of three months. If he/she contributes at least for 78 days in a contribution p e r i o d t h e e li g ibili t y i s t h e r e u p t o t h e e n d o f t h e corresponding benefit period. A worker is also eligible for extended sickness benefit when he/she is suffering from any one of the long term 34 diseases listed in the Act. This is admissible after the worker has been under ESI these conditions are satisfied m e d i c a l b e n e f i t i s a d m issibl e f o r a m ax i m u m p e r i o d o f 7 3 days for the IP and his/ her family.

16. Sickness Benefit … Sickness signifies a state of health necessitating Medical treatment and attendance and abstention from work on Medical grounds. Financial support extended by the corporation is such a contingency is called sickness Benefit Sickness Benefit represents periodical payments made to an Insured Person for the period of certified sickness after completing 9 Months in insurable employment.

17. Benefits to Employees … T o q u a l i f y f or t h i s b e n e f i t , c o n t r i b u t i o n s s h ou l d have been payable for atleast 78 days in the relevant contribution period. The Maximum duration for availing sickness Benefit is 91 days in two consecutive benefit periods Standard benefit rate – this rate corresponds to t h e a v e r a g e d a i l y wa g e of a n I n su r e d p e r son during the corresponding contribution period and is roughly half of the daily wage rate.

18. Extended Sickness Benefit … E x t e n de d S ic k n e s s B e n e f i t is a Ca s h B e n e f i t p a i d f or p r olo n ge d i l l n e s s ( T u b e r c u lo si s / L e p r o s y , Me nt a l a n d Malignant diseases) due to any of the 34 Specified diseases The IP should have been in continuous employment for a p e r iod of 2 y ea r s a n d s h o ul d h a ve c o n tr i b u t e d f or a t l ea s t 1 5 6 da y s in 4 p r e c e d i n g c o n tr i b u t ion p e r io d s

19. Extended Sickness Benefit … T h e da i l y r a t e o f E x t e n d e d S i c k n e s s B e n e f i t i s 4 % more than the standard Sickness Benefit rate admissible After exhausting sickness Benefit Payable for 91 days the Extended Sickness Benefit is payable upto further p e r i od of 1 2 4 / 3 09 d a y s t h a t c a n b e e x t e n d e d u p t o 2 y ea r s i n s p e c i a l c i r c u ms t a n c e s

20. Enhanced Sickness Benefit … Is Cash Benefit for IP undergoing sterilisation operation of vasectomy / tuberctomy for family planning. The contributory conditions are the dame as for claiming sickness benefits The daily rate of this benefit is double the standard benefit rate. Say, not less than the daily wage. The benefit rate of this benefit is double the standard benefit rate. Say, not less than the daily wage. The benefit is available upto 7 days for vasectomy and upto 14 days for tubectomy operations.

21. M a t e r n i t y B e ne f i t … Maternity Benefit is cash payable to an Insured women for the specified period of abstention from w o r k f or c o n f i n e m e n t or m i s ‐ c a rr i a g e or f or sickness arising out of pregnancy, “confinement” “premature birth of child or miscarriage” “confinement” connotes labour after 26 weeks of pregnancy whether the result issue is alive or dead, “Miscarriage” means expulsion of the contents of a p r eg n a n t u t e r us a t a n y pe r i od p r i or t o or du r i n g 26 th week of pregnancy.

22. M a t e r n i t y B e ne f i t … Criminal abortion or miscarriage does not, however, e nt i t le t o b e n e f i t . The contribution condition is the same as for Sickness Benefit. The daily benefit rate is double the sickness Benefit r a t e a n d i s t h us r o ug h ly e q uiv a l e n t t o t h e fu l l w a g e s . B e n e f i t s i s p a i d for S u n d a y s a l s o .

23. M a t e r n i t y B e ne f i t … The Benefit is paid as follows (Duration) a). For Confinement F or a t ot a l p e r i od 1 2 W ee k s b e g i nn i n g n ot mo r e than 6 weeks before the expected date of child birth, if the insured women dies during c o nf i n e m e n t or w i t h i n 6 w ee k s t h e r ea f t e r , l e a v i n g behind the living child, the benefit continues to be payable for the whole of the period. But the child also die during that period, the benefit will be paid upto and including the day of the death of the child.

24. Maternity Benefit… For Miscarriage For the period of 6 weeks following the date of miscarriage For sickness arising out of pregnancy, confinement, Premature birth of child or miscarriage : F or a n a dd i t i o n a l p e r i od or u p t o f our w ee k s . In all the cases, the benefit is paid only if the i n su r e d w om e n do e s n ot w o r k f or r e mu n e r a t i on during the period for which benefit is claimed. T h e r e i s n o w a i t i n g pe r i od.

25. M a t e r n i t y B e ne f i t … M ed ic al B o n us M ed ic al B o n us i s lu m p s u m p a y m e n t m ad e t o a n I ns u r e d w o m a n o r t h e w i f e o f a n i n s u r e s p e r s on in case she does not avail medical facility from an ESI hospital at the time of deliveryof a child. This bonus of R s . 2 5 /‐ h a s b ee n i n c r ea s e d t o R s . 1 00 /‐ f r om 1 s t Ap r i l 2 3

26. Disablement Benefit … a). Temporary disablement benefit : In case of temporary disability arising out of an e m p l o ym e n t i n j u r y o r o c cu pa t i o n a l d i s e a s e . , Disablement benefit is admissible to insured person for the entire period so certified by an Insurance Medical officer / Practitioner for which I P do e s n ot w o r k f or wa g e s . The benefit is not subject to any contributory condition and is payable at a rate which is not less than 70% of daily average wages . However, not payable if the incapacity lasts for less than 3 days excluding the date of accident.

27. Permanent disablement benefit … In case an employment injury or occupational disease results in permanent, partial or total loss of earning capacity, Periodical payments are made to the IP for life at a r a t e d epe n d i n g on t h e a ctu a l l oss of e a r n i n g capacity as may be determined and certified by a duly‐constituted Medical Board. The rates of Disablement Benefits are determined in accordance with the provisions of Rule 57 of ESI (Central) Rules, 1991. In order to product erosion in real value of the pe r i od i c a l p a y m e n t s of P e r m a n e n t D i s a b l e m e n t benefits, against rise in the cost of living index, periodical increases are granted, based on actuarial calculation

28. Permanent disablement benefit … C o m m u t a t i on o f p e r i od ic al p a y m e nt s i n t o lu m p s um (o n e t i m e p a y m e nt ) i s p e rm i ss i b l e w h e r e t h e permanent disablement stands assessed as final and daily rate of benefit does not exceed Rs. 1.50. per day. C o m m u t a t i on o f P e r m a n e n t D isa b l e m e n t B e n e f it into lump sum payment is also allowed in case the total commuted value does not exceed Rs.10000/‐ ( T h e c e i l i n g is n o w b e i n g r a is ed t o R s .3 000 / ‐ ).

29. Dependants’ Benefit … Dependents Benefit is a monthly pension payable to the e li g i b le d e p e n d e n t s o f a n i n s u r e d p er s o n w h o d i e s a s a result of an Employment Injury or occupational disease B e n e f i c i a r i e s a n d D u r a t i o n o f b e n e f it Widow / widows during life or until remarriage Legitimate or adopted son until age 18 or if legitimate s o n i s i n f i r m , t il l i n f i r m i t y l a s t s. Legitimate or adopted unmarried daughter until age 18 or until marriage, whichever is earlier, or if infirm, till i n f i r m i t y l a s t s a n d s h e c o n t i n u e s t o b e u n m a rr i e d . In the absence of any widow or legitimate child, the benefit is payable to a parent or grandparent for life, to any other male dependent until age 18 or to an unmarried or widowed female dependent until age 18.

30. How much … T h e t o t a l d i v is i b le b e n e f i t i s e q u i v a l e n t t o t h e t e m p o r a r y disablement benefit rate (roughly 70% of the wage rate). The widow / widows share 3/5 th of the benefit and the legitimate or adopted son and daughter 2/5 th each of the benefit. If the total benefit so divided exceeds the full rate, there is a proportionate reduction in the respective shares of the beneficiaries. The amount of pension paid to the dependents of a deceased insured person is reviewed vis‐à‐vis the cost of li v i n g i n d e x a n d i n c r ea s e s a r e g r a n t e d f r o m t i m e t o t i m e t o c o m p e n s a t e f o r e r o si o n i n i t s r e a l v a l u e . Dependants’ Benefit …

31. Other Benefit … (i). Funeral Expenses Funeral Expenses are in the nature of lump sum payment up to a maximum of Rs.2500/- made to defray the expenditure on the funeral of deceased IP. The amount is paid either to the eldest surviving member of the family or, in his absence, to the person who actually incurs the expenditure on the funeral.

32. Other Benefit … R e h a b i l i t a t io n A ll o w a n c e The corporation, vide its Resolution dated 22.12.1979, resolved to grant rehabilitation Allowance to the IPs, for each day, on which they remain admitted in an Artificial limb centre. On the rates, which generally confirm to double the Standard Sickness Benefit rate. T h e a b ov e b e n e f i t w a s i nt r o d u c e d w i t h e ff e c t f r om 1.1.1980

33. Levy of Interest & Damages … Under Section 39(5)(a) of the ESI act, read with Regulation 31(A) of the ESI (General) Regulations 1950, the employer is liable to pay simple interest at the rate of 15 percent per annum in respect of each day of default or delay in payment contributions. In addition, under the Provision of Regulation 31‐ C of ESI (General) Regulations, 1950, read with sec.85(B)(i) of the ESI A c t , t h e C o r p o r a t i o n i s em p o w e r ed t o r e c o v er d ama g e as under: Period of delay in p a yme n t o f C o n t r i b u ti o n i). Up to less than 2 months Rate of Damages o n t h e am o u n t d u e 5 % ii). 2 months and above but less than 4 months 10% iii).4 months and above but less than 6 months 15% iv). 6 months and above 25% Interest and damages can also recovered as arrears of land revenue Section 45(c) to Section 45(I) by the Recovery Officer of ESI Corporation.

34. Obligation of the Employers … Get your Factory / establishment registered with in 15 d a y s a f t e r t h e A c t b e c o m e s a p p li c a b l e . S u b m i t F o r m 1 t o the Regional office for this purpose. Obtain Employer’s c o d e N o . f o r u se i n a ll E S I C F o r m s / d o c u m e n t s a n d correspondence with the offices of the ESI Corporation. 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 D a y ’ a n d o b t a i n i n s u r a n c e N u m b e r s f r o m t h e c o n c e r n e d Local Office/ Regional Office, In respect of newly a p p o i n t e d e m pl o y ee s, f il l u p t h e d e c l a r a t i o n f or m s oo n a f t e r a p p o i n t m e n t o f s u c h e m pl o y ee s a n d s u b m i t t h e s a m e t o t h e L o c a l O f f i c e C o n c e r n e d .

35. Obligation of the Employers … P e n d i n g r e c e i p t of i de nt i t y c a r d s / i de nt i t y c e rt i f i c a t e s y ou m a y is s ue “ c e rt i f ic a t e o f e m p l o y m e nt ” i n F o r m 86 t o t h e c ov e r e d e m p l oy ee ( s ) e n a b l i n g t h em t o a v a il c a sh / m ed ic al B e n e f i t s P a y E S I c o n tr i b u t i on ( Em p l o y ee ' s S h a r e @ 4 . 7 5 % a n d the Employer’s share @ 1.75% of the wages) with in 21 d a y s o f t h e m o n t h fo l l o w i n g , i n w h ic h t h e w a g e s f a l l due.

36. Obligation of the Employers … 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 authorised ESI doctor.

37. Obligation of the Employers … Maintain the following records/ registers properly for the purpose of inspection Attendance Registers / Muster Rolls (in respect of all employees including those employed through contractors) W a g e r e g is t e r Cash Book / Bank Book Account Books including Ledgers and Vouchers, Balance Sheet. Employees’ Register A c c i d e n t B oo k Returns of Contribution Return of Declaration Forms C o pi e s o f C h a ll a n s Inspection Book

38. Obligation of the Employers … Submit return of contribution within 42 days of the expiry of contribution period. Intimate the date of closure of shifting (Temporary or Permanent) of the Factory / Establishment to the Regional office / Local Office w i t h i n s e v e n d a y s o f i t s c l osu r e or s hif t i n g Promptly report change in business activity, ownership of the concern or its management. Ascertain the liability towards ESI dues, while taking over the ownership of any factory/establishment by purchase, gift, lease or license or in any other manner whatsoever as new owner is liable to discharge the past liabilities if any

39. Thank You …..