APPLICABILITY
The ESI Act is applicable to all non-seasonal factories employing 10 or more persons [Section -1(2) read with Section 2(12) and Section 2(19A)]. The State Goverments have extended the coverage under Section 1(5) of the Act to Shops, Hotel, Restaurants, Cinema including preview theatres, Road-motor transport undertakings, Newspaper establishments, Private Medical Institutions, Educational Institutions and to contract and casual employees of Municipal Corporation/Municipal Bodies employing 10 or more persons in the certain States/UTs, where State Govt. is the appropriate Govt.
The Central Govt. has extended the coverage under Section 1(5) to Shops, Hotels, Restaurants, Road Motor Transport establishments, Cinema including preview theatres, Newspaper establishments, establishment engaged in Insurance Business, Non-Banking Financial Companies, Port Trust, Airport Authorities, Warehousing establishments employing 20 or more Persons, where Central Govt. is the appropriate Govt.
The existing wage limit for coverage under the Act, effective from 01.01.2017, is Rs.21,000/- per month (Rs.25,000/- per month in the case of Persons with Disability).
AREAS COVERED
The ESI Scheme is now notified 643 Districts in 36 States and Union Territories, which include 535 fully notified districts and 108 partially notified districts where scheme is notified in Districts Headquarters Area & in Prominent Industrial Centers Under Section 1(3) of ESI Act, 1948.
The Scheme is yet to be notified in 135 districts. The status of notification District wise is annexed.
| Coverage Position | (As on 31st March 2022) |
| No. of Insured Persons | 3.10 Crores |
| No. of Employees | 2.78 Crores |
| Total No. of Beneficiaries | 12.04 Crores |
| No. of Insured women | 58.69 Lakhs |
| No. of Employers, etc | 15.94 Lakhs |
The promulgation of Employees’ State Insurance Act, 1948(ESI Act), by the Parliament was the first major legislation on social Security for workers in independent India. It was a time when the industry was still in a nascent stage and the country was heavily dependent on an assortment of imported goods from the developed or fast developing countries. The deployment of manpower in manufacturing processes was limited to a few select industries such as jute, textile, chemicals etc. The legislation on creation and development of a fool proof multi-dimensional Social Security system, when the country’s economy was in a very fledgling state was obviously a remarkable gesture towards the socio economic amelioration of a workface though limited in number and geographic distribution. India, notwithstanding, thus, took the lead in providing organized social protection to the working class through statutory provisions.
The ESI Act 1948, encompasses certain health related eventualities that the workers are generally exposed to; such as sickness, maternity, temporary or permanent disablement, Occupational disease or death due to employment injury, resulting in loss of wages or earning capacity-total or partial. Social security provision made in the Act to counterbalance or negate the resulting physical or financial distress in such contingencies, are thus, aimed at upholding human dignity in times of crises through protection from deprivation, destitution and social degradation while enabling the society the retention and continuity of a socially useful and productive manpower.
History
The scheme was inaugurated in Kanpur on 24th February 1952 (ESIC Day) by then Prime Minister Pandit Jawahar Lal Nehru. The venue was the Brijender Swarup Park, Kanpur and Panditji addressed a 70,000 strong gathering in Hindi in the presence of Pt.Gobind Ballabh Pant, Chief Minister Uttar Pradesh; Babu Jagjivan Ram, Union Labour Minister; Raj Kumari Amrit Kaur, Union Health Minister; Sh.Chandrabhan Gupt, Union Food Minister and Dr.C.L.Katial, the first Director General of ESIC.
The scheme was simultaneously launched at Delhi as well and the initial coverage for both the centres was 1,20,000 employees. Our first prime Minister was the first honorary insured person of the Scheme and the declaration form bearing his signature is a prized possession of the Corporation.
It is important to mention here that it blossomed as the first social security scheme in 1944, when the Govt. of the day was still British.The first document on social insurance was “Report on Health Insurance” submitted to the Tripartite Labour Conference, headed by Prof. B.P.Adarkar, an eminent scholar and visionary. The Report was acclaimed as a worthy document and forerunner of the social security scheme in India and Prof. Adarkar was acknowledged as “Chhota Beveridge” by none other than Sardar Vallabhbhai Patel. Sir, William Beveridge, as all know, was one of the high priests of social insurance. The report was accepted and Prof. Adarkar continued to be actively associated with it till 1946. On his disassociation he strongly advocated management of the Scheme by an expert from ILO. In 1948 Dr. C.L.Katial, an eminent Indian doctor from London took over as the 1st Director General of ESIC and he steered the affairs of the fledgling Scheme till 1953.
Since the red letter day of 24th February in the annals of social security in India , there has been no looking back. A lighted lamp which is the logo of ESIC truly symbolises the spirit of the Scheme, lighting up lives of innumerable families of workers by replacing despair with hope and providing help in times of distress, both physical and financial.
During the 73 years of its existence, ESIC has grown from strength to strength and the Corporation owes it, most of all, to the commitment, dedication and perseverance of persons like Prof. Adarkar and Dr. Katial.
The section 46 of the Act envisages following six social security benefits :-
(a) Medical Benefit : Full medical care is provided to an Insured person and his family members from the day he enters insurable employment. There is no ceiling on expenditure on the treatment of an Insured Person or his family member. Medical care is also provided to retired and permanently disabled insured persons and their spouses on payment of a token annual premium of Rs.120/- .
(b) Sickness Benefit(SB) : Sickness Benefit in the form of cash compensation at the rate of 70 per cent of wages is payable to insured workers during the periods of certified sickness for a maximum of 91 days in a year. In order to qualify for sickness benefit the Insured Person is required to contribute for 78 days in a contribution period of 6 months.
1. Extended Sickness Benefit(ESB) : SB extendable upto two years in the case of 34 malignant and long-term diseases at an enhanced rate of 80 per cent of wages.
2. Enhanced Sickness Benefit : Enhanced Sickness Benefit equal to full wage is payable to insured persons undergoing sterilization for family planning upto 7 days/14 days for Vasectomy and Tubectomy respectively.
(c) Maternity Benefit (MB) : Maternity Benefit for confinement/pregnancy is payable for Twenty Six (26) weeks, which is extendable by further one month on medical advice at the rate of full wage subject to contribution for 70 days in the preceding Two Contribution Periods.
(d) Disablement Benefit
- Temporary disablement benefit (TDB) : From day one of entering insurable employment & irrespective of having paid any contribution in case of employment injury. Temporary Disablement Benefit at the rate of 90% of wage is payable so long as disability continues.
- Permanent disablement benefit (PDB) : The benefit is paid at the rate of 90% of wage in the form of monthly payment depending upon the extent of loss of earning capacity as certified by a Medical Board
(e) Dependants Benefit(DB) : DB paid at the rate of 90% of wage in the form of monthly payment to the dependants of a deceased Insured person in cases where death occurs due to employment injury or occupational hazards.
(f) Other Benefits :
- Funeral Expenses : An amount of Rs.15,000/- is payable to the dependents or to the person who performs last rites from day one of entering insurable employment.
- Confinement Expenses : An Insured Women or an I.P.in respect of his wife in case confinement occurs at a place where necessary medical facilities under ESI Scheme are not available.
In addition, the scheme also provides some other need based benefits to insured workers.
- Vocational Rehabilitation :To permanently disabled Insured Person for undergoing VR Training at VRS.
- Physical Rehabilitation : In case of physical disablement due to employment injury.
Rajiv Gandhi Shramik Kalyan Yojana :
This scheme of Unemployment allowance was introduced w.e.f. 01-04-2005. An Insured Person who become unemployed after being insured two or more years, due to closure of factory/establishment, retrenchment or permanent invalidity not less than 40% arising out of non-employment injury are entitled to :-
- Unemployment Allowance equal to 50% of wage for a maximum period of upto Two Years during the life time.
- Medical care for self and family from ESI Hospitals/Dispensaries during the period IP receives unemployment allowance.
- Vocational Training provided for upgrading skills – Expenditure on fee/travelling allowance borne by ESIC.
Atal Beemit Vyakti Kalyan Yojana (ABVKY) :
This scheme is a welfare measure for employees covered under Section 2(9) of ESI Act, 1948, in the form of relief payment upto 90 days, once in a lifetime. The Scheme was introduced w.e.f. 01-07-2018 on pilot basis for a period of two years initially. The scheme has now been extended upto 30 June 2022. It has also been decided to enhance the rate of unemployment relief under the scheme to 50% of wages from earlier rate of 25% along with relaxation in eligibility conditions, provided the Insured Person should have been in insurable employment for a minimum period of one year immediately before her/his unemployment and should have contributed for not less than 78 days in the completed contribution period in 12 months immediately prior to unemployment. In a significant relaxation, relief shall become due for payment after 30 days from date of unemployment and claim can be submitted directly to the designated ESIC Branch Office by the worker. Claims to get the relief can be made online at website www.esic.in along with submission of the physical claim with an affidavit, photocopy of Aadhaar Card and Bank Account details to the designated ESIC Branch Office by post or in person.
Incentive to employers in the Private Sector for providing regular employment to the persons with disability :
- Minimum wage limit for Physically Disabled Persons for availing ESIC Benefits is 25,000/-.
- Employerss’ contribution is paid by the Central Government for 3 years.
Benefits & Contributory Conditions :
An interesting feature of the ESI Scheme is that the contributions are related to the paying capacity as a fixed percentage of the workers wages, whereas, they are provided social security benefits according to individual needs without distinction.
Cash Benefits are disbursed by the Corporation through its Branch Offices (BOs) / Pay Offices (POs), subject to certain contributory conditions.