III UNIT

INDUSTRIAL LAW

THE EMPLOYEES STATE INSURANCE ACT 1948

INTRODUCTION
The act is a piece of legislation of social security. The act confers benefit on employees against sickness,maternity,and other disabilities. Its object is to introduce social insurance by providing for certain benefits to employees. The employees state insurance scheme is being administered by the employees state insurance corporation which has been set up by the central Govt under the act .

A statutory body known as the employees state insurance corporation has been created under the act to administer and execute the employees state insurance scheme . It also seeks to set up the standing committee as well as the medical benefit councils to carry out the intents and purports of the act. The act also requires the regional Boards , local Committees and regional and local Medical Benefit Councils to be set up or establish which carry out the work at regional level or state level.

Employees state Insurance corporation

The act creates obligation on the Central Govt. to create a Fund for this purpose and seeks to treat the expenditure incurred by the Central govt as loan to the ESI corporation. The fund so created has to be expended for 1.Payment of benefits ,provision of medical treatment and attendance to insured persons or to their families. 2. Payment of fees and allowances to members of the corporation. 3.Payment of salaries, leave and joining time allowances, travelling and compensatory allowances o the corporation.

4. Establishment and maintenance of hospitals , dispensaries and other institutions. 5.Payment of contributions to nay state Government, local authority towards the cost of medical treatment. 6.Defraying the cost and expenses of auditing the accounts 7. Defraying the cost and expenses of ESI courts 8.Payment of contracts 9.Defraying expenditure for the improvement of the health and welfare of insured persons.

Standing Committee
Subject to the general superintendence and control of the ESI corporation and to act as its executive body, a standing committee has been constituted from among the members of the ESI corporation .The standing committee shall consist of1. A chairman, appointed by the central Govt. 2. 3 members of the ESI corporation, appointed by the central govt. 3. 3 members of the ESI corporation representing such 3 state govt.

4. 8 members elected by the ESI corporation as follows: a.3 members from among the member of the ESI corporation representing employers, b. 3 members from among the members of the ESI corporation representing employees c.1 member from among the members of the ESI corporation representing the medical profession d.1 member from among the members of the ESI corporation elected by parliament. 5.The director general of the ESI corporation,exofficio

Medical benefit council

To advise the ESI corporation on the medical side of its operations , a medical benefit council has been constituted. It consists of the following members: 1. The director general , health services , ex-officio as chairman 2. A deputy director general ,health services, to be appointed by the central govt. 3. The medical Commissioner of the ESI Corporation ,Ex-Officio, 4. 1 member each representing each of the states

5.3 members representing employers to be appointed by the central Govt. 6.3 members representing employees to be appointed by the central govt. 7. 3 members of whom not less than 1 shall be a woman , representing the medical profession, to be appointed by the central govt.

 The scheme of Employees state insurance is contributory. As such both the employers and employees have to pay their contributions in accordance with the provisions of the act.The contribution payable by an employee is known as employees contribution and the contribution payable by the employer is known as employers contribution. These contributions are to be paid to the ESI corporation.

Contributions

 Contribution under ESI Act,1948 1. Employees : 1.75% on total monthly wages 2. Employer : 4.75% on total monthly wages

Benefits
The Act provides for 6 types of benefits to which the insured persons ,their dependants or certain other persons are entitled . These benefits are as follows: 1.Sickness benefit 2.Maternitybenefit 3.Disablement benefit 4.Dependants benefit 5. Medical benefit 6.Funeral expenses

1.Sickness Benefit- Insured employees is entitled to receive for the period of his sickness as the daily standard benefit rate . Minimum 78 days of the corresponding contribution is must. Benefit is not available for the first 2 days of sickness. Maximum period for benefit is 91 days in one year . Standard benefit rate : The daily rate which sickness benefit is payable to an insured employee during the period of his sickness. Lowest rate is Rs. 14/- Highest rate is Rs. 195 /2.Maternity Benefit -A periodical cash benefit is payable to an insured woman employee, IN CASE OF: Confinement, miscarriage or medical

Sickness arising out of pregnancy, confinement, premature birth of child or medical termination of pregnancy. Minimum 70 days in the immediately preceding two consecutive contribution periods is must. Maximum period for benefit is 84 days in one year . Criminal abortion does not, however, entitle to benefit. The benefit is payable of twice the standard benefit rate, for all days on which she does not work during the prescribed period or Rs. 20 which ever is higher.

3.Disablement Benefit: -Disablement Benefit a) Temporary disablement benefit : In case of temporary disability arising out of an employment injury or occupational disease, Disablement benefit is admissible to insured person for the entire period so certified by an Insurance Medical officer / Practitioner . 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.

4.Medical Benefit - means Medical care of IPs and their families, wherever covered for 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 sicknesssection73. 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 period the eligibility is there up to the end of the

5. Funeral expenses : In case of death of an insured employee, the eldest surviving member of his family, and if the employee had no family or was not living with his family at the time of his death, then the person who actually incurs expenditure on the funeral of the employee, is entitled to receive the a payment called funeral expenses. Maximum permissible amount of such payment is Rs. 2500/-

Penalties & Offences

Offences- If any person - Fails to pay any contribution payable by him under the Act; or Deducts from the wages of an employee the employer's contributions ; or Fails to submit any return required by the regulations, or makes a false return. He would be punished with imprisonment up to 1 year or with fine upto Rs. 4000/- or with both