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    Features of ESI Act

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    Anoop Singh
    The Employees State Insurance Act, 1948 applies to factories employing 10 or more persons and establishments notified by the government. It covers employees earning up to Rs. 15,000 per month. Employers must register eligible employees and maintain records of wages paid and contributions collected. The act provides sickness, maternity, disability and death benefits funded by contributions of 4.75% of wages by the employer and 1.75% by the employee. Employers are liable to pay contributions and comply with the act's provisions.

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    Features of ESI Act

    Uploaded by

    Anoop Singh
    1K views2 pages
    The Employees State Insurance Act, 1948 applies to factories employing 10 or more persons and establishments notified by the government. It covers employees earning up to Rs. 15,000 per month. Employers must register eligible employees and maintain records of wages paid and contributions collected. The act provides sickness, maternity, disability and death benefits funded by contributions of 4.75% of wages by the employer and 1.75% by the employee. Employers are liable to pay contributions and comply with the act's provisions.

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    The Employees State Insurance Act, 1948 applies to factories employing 10 or more persons and establishments notified by the government. It covers employees earning up to Rs. 15,000 per month. Employers must register eligible employees and maintain records of wages paid and contributions collected. The act provides sickness, maternity, disability and death benefits funded by contributions of 4.75% of wages by the employer and 1.75% by the employee. Employers are liable to pay contributions and comply with the act's provisions.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    1K views2 pages

    Features of ESI Act

    Uploaded by

    Anoop Singh
    The Employees State Insurance Act, 1948 applies to factories employing 10 or more persons and establishments notified by the government. It covers employees earning up to Rs. 15,000 per month. Employers must register eligible employees and maintain records of wages paid and contributions collected. The act provides sickness, maternity, disability and death benefits funded by contributions of 4.75% of wages by the employer and 1.75% by the employee. Employers are liable to pay contributions and comply with the act's provisions.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
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    ESI Act

    The Employees State Insurance Act, 1948


    Applicability of the act: This act extends to whole of India. This act applies to factories where 10 or more persons are employed for wages or were employed on any of preceding 12 months and the manufacturing process is carried on with the aid of power and 20 or more persons without the aid of power. It also applies to all the factories and establishments which are so notified by the concerned government in any specified area. But it does not apply on the seasonal factories. Who is eligible: This act covers all employees including engaged through the contracts but whose remuneration does not exceed Rs.15, 000 p.m. including staff in the class of administrative, canteen, loading-unloading, security, etc. Apprentices who are appointed for learning the work with no right of being absorbed in service, do not come with the ambit of this act. Registration of Employees: a declaration in Form No.1 shall be send by the employer to Regional Office along with the Return of Declaration in Form No.3 (in duplicate) for registration and allotment of insurance numbers within 10 days of the date on which the particulars for the declaration forms were furnished. Meaning of wages: Wages means all remuneration paid or payable in cash to an employee and also include overtime, product bonus, commission, D.A., H.R.A etc. But it does not include payment for:1. 2. 3. 4. 5. 6. 7. Contribution by Employer for provident and Family pension Fund. Any Travelling Allowance or the value of any travel concession Any gratuity payable on discharge Bonus payable under the Bonus Act Retrenchment compensation or notice pay or leave encashment Allowances such as washing, conveyance, travelling.etc., Any payment made at intervals exceeding 2 months.

    Mode of payment: The employer has to maintain a register in Form No.7 for each insured employee for each contribution period. Each contribution period will last 6 months starting from 1 st April and 1st October of each year. On joining fresh service first, contribution of an employee will commence from the date of his joining. On expiry of the contribution period, the employer will send a return in Form No.6 to the Regional Office in triplicate within 42 days of the close of contribution period. Interest @ 6 % p.a. is chargeable for delayed payment for each day and damages to the extent of 100% of arrears can also be charged. Rate of contribution: Employees contribution and the employers contribution is to be paid at a fixed percentage of wages. The employees contribution will be calculated @ 1.75% of his wags rounded off to the next high rupee and the employers contribution will be calculated @ 4.75% of the total wage bill of all the covered employees in respect of every wages period rounded off to the next higher rupee. No employees contribution shall be payable in respect of a person whose average daily wages are below Rs.6 in any wages period. Average daily wages for the purpose would be the wages payable for a wage

    period divided by 26, 13, 6, or 1 according as the wage period of a person is a month a fortnight a week or a day respectively. All the contributions are to be deposited within 21 days of the following month. Employees drawing upto Rs.25 per day need not contribute anything. The aggregate of employees and employers contribution to be deposited should be rounded off to next rupee. If the contribution is not paid in time interest @ 12 % p.a. is payable. In addition, ESIC authorities can impose damages varying between 5 % to 25 % of contribution under section 8-IB. Benefits : The employees can get the following benefits as result of coverage under ESI:(a) (b) (c) (d) (e) (f) Sickness Benefit Disablement Benefit Maternity Benefit Dependents Benefit Medical Benefit and Funeral Expenses not exceeding Rs.1500.

    Maintenance or records: The employer has to maintain:1. 2. 3. Register of employees (Wages Register) with contribution in Form No.7 Accident Book Inspection Book

    Liability of principal employer: If any employer is employing workers through a contractor who is covered under this Act, then it is the liability of the principal employer to fulfill the requirements in case the contractor fails to do so. He can recover the liability from the contractor afterwards. Liability in case on accident: In case an insured employee meets an accident arising out of and in the course of his employment, the employer must send the information to the Regional Office of ESI with 24 hrs. and any payment of compensation thereof will be made by ESI. Liability in case of non-payment: It is the responsibility of the employer to make the payment of contribution and recover this from the employee the amount of his contribution. If no recovery is made in a particular wage period, he cannot recover it thereafter.

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