The ESI Scheme of the Indian Government which was sanctioned under the Employees’ State Insurance Act was carried out in order to achieve the policy of protecting the ’employees’ against the hazards of sickness, maternity, disablement and death which were caused due to injury which was caused during the course of employment and also to provide medical care to the insured persons and also to their families. The ESI Scheme comes under the purview of the Ministry of Labour and Employment (External website that opens in a new window). It also confirms with the International Labour Organisation (ILO) conventions, which makes the ESI Scheme of global standing.
As of now, the total beneficiary population that is under this scheme stands at about 35 million. The Scheme has already been implemented in all the states except for the states of Nagaland, Manipur, Tripura, Sikkim, Arunachal Pradesh and Mizoram.
This scheme includes all the employees that are working in factories that are running on non-seasonal power that employ either 10 or more persons, and also for the factories not using power that employ 20 or more persons. It also includes those who are working in shops, hotels, restaurants, cinemas, road motor transport undertakings and the newspaper establishments. The wage-limit for coverage under the Act is that the person who avails the benefit of this scheme should earn Rs.10000 per month, as on 31st March 2007. Each of the insured employee and their employer are required to contribute a certain percentage of their wages to the ESIC every month. These rates are thus revised from time to time.
Once an employee is recruited in an ESI Scheme which is a covered establishment, then he/she is required to fill a Declaration Form. The employee is then allotted a Registration Number, which distinguishes and this identifies the person for the purposes of the Scheme. A person is thus registered once and once only upon his entry in an insurable employment. The person is then issued a Temporary Identification Certificate, which is also valid for a period of 3 months (it may be extended). During this period, the insured Person is also given a permanent “family photo Identity Card” in exchange for the Certificate. This certificate has to be produced at the time of claiming medical care at the dispensary/clinic and for cash benefits. If the Identity Card gets lost a duplicate card is issued on payment.
The ESI Scheme runs like the most of the social security schemes. It is a self-financing health insurance scheme and the contributions are raised from covered employees and their employers as a fixed percentage of the wages. The payments are to be made on a monthly basis. An employee who is covered under the scheme has to contribute 1.75% of the wages whereas; an employer who contributes 4.75% of the wages that are payable to an employee. The total contribution which is in respect of an employee thus works out to 6.5% of the wages that are payable. However, the employees who are earning less than Rs 50/- a day are exempted from the payment of contribution.
BENEFITS OF THE ESI SCHEME
Under Section 46 of ESIC Act, a total of six social security benefits have been provided to the employees who are working with various organizations across India. This medical care is provided through a network of ESI dispensaries, panel clinics, diagnostic centres and ESI hospitals. These six social security benefits are for the welfare of the employees and are enlisted as follows:
- Medical Benefits
This benefit consists of the cost of full and expanded medical care. It includes the charges for hospitalisation, drugs and dressings, special diet, laboratory tests and also includes the consultation fees of specialists. Immunisation and the sterilisation procedures are also provided for through this scheme. This benefit also comprises the supply of free artificial aids such as limbs, cervical collars, crutches, wheelchairs and cardiac pacemakers.
2. Sickness Benefits
The periodical cash payments which are made to an insured person during a period of certified sickness when the employee was absent from work is called ‘sickness benefit’. The maximum duration for sickness benefit is 91 days. However extended sickness for the benefit is available to those who are suffering from specific diseases such as tuberculosis and leprosy. Enhanced sickness benefit are equal to their daily wage which is payable to those who undergo sterilisation operations for family planning purposes. The rate of benefit is the compensation at the Standard Sickness Benefit rate of not less than 50 per cent of the daily wages.
3. Maternity Benefits
This benefit is payable to an insured women for a confinement period of 12 weeks as well as for miscarriages, medical termination of pregnancies and illnesses which is arising out of pregnancy. The rate of benefit is double of the Standard Sickness Benefit rate and it is not less than full wages.
4. Disablement Benefits
This is a payment which is available to those insured employees who become disabled as a result of the workplace injuries. Those who have temporary disabilities receive the benefits till they are healed while those with permanent disabilities are paid lifelong benefits. The rate of benefit is up to 140 per cent of the Standard Sickness Benefit rate and it is not less than 70 per cent of the daily wages of the insured.
The dependants of employees who lose their lives as a result of the workplace injuries are paid to the ‘Dependants’ Benefit’. The rate of benefit is a daily allowance, which is increased from time to time. The rate of benefit is up to 140 per cent of the Standard Sickness Benefit rate and it is not less than 70 per cent of daily wages of the insured.
6. Funeral Expenses
This benefit is a lump sum of up to a maximum of Rs. 2500 for the settlement of the expenses that are incurred at the funeral of a deceased insured person. It is given either to the eldest surviving member of the family or to the person who has actually paid for the funeral.
However for more information , you can contact LegalRaasta.