ESI act - India Employee State Insurance

1. THE EMPLOYEES’ STATE INSURANCE
- (CENTRAL) RULES, 1950
- By
satya_swapna@yahoo.com

2. Index
 Applicability
Industries, States and Individuals
 Contributions
Share by Employee , Employer and State Governments
Period of Contributions
 Benefits
Medical, Maternity, Sickness Benefits
Disablement, Dependent benefits..etc

3. Applicability
For Factories
 Act is applicable to non-seasonal factories, shops,
hotels, restaurants, cinemas including preview theatres,
road-motor transport undertakings, Private Medical institutes,
Educational institutions and newspaper establishments employing 10*
or more persons.
 Act has been extended to employing 20* or more persons in certain
States/UTs.

4. Applicability
For States and UTs
All the States except Nagaland, Manipur, Tripura, Sikkim,
Arunachal Pradesh, Mizoram and union territories; Delhi,
Chandigarh and Pondicherry
For Employed
The existing wage limit for coverage under the Act is Rs. 15,000/- per month (
w.e.f. 01/05/2010).
Any employee earning 15000 or less per month has to be covered under ESI act

5. Contributions
 Covered employees contribute 1.75% of the wages,
 Employees earning up to Rs.100/- a day are exempted from payment
of their share of contribution.
 Employers contribute 4.75% of the wages, payable to their employees.
 The State Governments contribute 1/8th of the expenditure of
medical benefit within a per capita ceiling of Rs. 1200/- per Insured Person
per annum.
** These contributions are subject to change from time to time

6. Contribution Periods
For employer
within 21 days of the last day of the Calendar month in which the
contributions fall due
An employer (both employer share and employee share) shall pay
these contributions at the above specified rates to the Corporation.
Contribution Period and Benefit Period
Contribution Period Cash Benefit Period
1st Apr to 30th Sept. 1st Jan of the following year to 30th Jun.
1st Oct. to 31st Mar 1st Jul to 31st Dec of the year following
Contribution once started shall continue till end of the cycle even if the employee has
moved out of 15000 per month wage limit. Subsequently is the benefit period.

7. Benefits
Medical Benefit
 Full medical care(no ceiling on expenditure on the treatment) is provided to an
Insured person and his family members from the day he enters insurable employment.
 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/- .
Maternity Benefit
 Maternity Benefit for pregnancy is payable for three months.
 Extendable by further one month on medical advice at the rate of full wage
subject to contribution for 70 days in the preceding year

8. Benefits
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.
 SB can be extendable up to two years in the case of 34 malignant and long-term
diseases at an enhanced rate of 80 per cent of wages
 Enhanced SB equal to full wage is payable to insured persons undergoing sterilization
for 7 days (14 days for female) workers.
 In order to qualify for sickness benefit the insured worker is required to contribute
for 78 days in a contribution period of 6 months.

9. Benefits
 Temporary Disablement Benefit at the rate of 90% of wage is payable so long as
disability continues.
 The Permanent Disablement (PD) 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
 Dependants Benefit(DB) is 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.
 Funeral Expenses : An amount of Rs.10,000/- is payable to the dependents or to the
person who performs last rites from day one of entering insurable employment
**PD is applicable from the day one of entering insurable employment & irrespective of having paid
any contribution in case of employment injury.

10. Benefits
Unemployment Allowance:
An Insured Person who become unemployed after
being insured three or more years, due to closure of
factory/establishment, retrenchment or permanent
invalidity are entitled to :-
• Unemployment Allowance equal to 50% of wage
for a maximum period of upto one year.
• Medical care for self and family from ESI
Hospitals/Dispensaries during the period
Insured person receives unemployment
allowance.
• Vocational Training provided for upgrading
skills - Expenditure on fee/travelling allowance
borne by ESIC.

11. Sources : esic.in
April 2013