APPLICABILITY OF THE ESI ACT 

The ESI Act, (1948) applies to the following categories of factories and establishments in the implemented areas:- 

• Non-seasonal factories using power and employing ten(10) or more persons

• Non-seasonal and non power using factories and establishments employing twenty (20) or more persons. 

The “ appropriate Government ” State or Central is empowered to extend the provisions of the ESI Act to various classes of establishments, industrial, commercial, agricultural or otherwise in nature. Under these enabling provisions most of the State Govts have extended the ESI Act to certain specific classes of establishments, such as, shops, hotels, restaurants, cinemas, preview theatres, motors transport undertakings and newspaper and advertising establishments etc., employing 20 or more persons. 

CONTRIBUTION

The ESI Scheme is mainly financed by contributions raised from employees covered under the scheme and their employers, as a fixed percentage of wages. As of now, the rates of contribution are:- 

1. Employees’ earning upto Rs.50/- a day as wages are exempted from payment of their part of contribution.
2. The State Govts bear one-eighth share of expenditure on Medical Benefit within the per capita ceiling of Rs.900/- per annum and any additional expenditure beyond the ceiling.

WAGE CEILING 

Employees of covered units and establishments drawing wages upto Rs.10,000/- per month come under the purview of the ESI Act, 1948 for multi-dimensional social security benefits. 

RIGHTS AND DUTIES OF EMPLOYERS

(a) Duties of Employers

• An employer will apply in Form-01 for coverage under the ESI Act, within 15 days after the Act becomes applicable to a factory or establishment. 
• The employer will submit Declaration Form in respect of all coverable employees in the unit.
• The employer will collect temporary identity cards from the Branch Office concerned followed by permanent photo identity cards and pass them on to the employees concerned.
• The employer will deposit both employees and employers contribution as per specified rates within 21 days of the following month.
• The Employer will maintain an Accident Book and submit accident reports to the Branch Office, involving insured worker(s) on the job, within 24 hours of an accident.
• The Employer will maintain all such records and registers as are required under the Act and produce them for verification/inspection before the authorised officers of the Corporation.
• The employer will facilitate proper inspection of records/registers and the premises by visiting officers of ESIC as and when so required.
• The employer shall submit half-yearly Return of Contributions (RC) by 12th May/11th November every year with all columns properly filled.
• The employee shall indicate insurance number of IPs in chronological order in the return of contribution and his own code number in all correspondence.
• The employer will not make any false declaration or misrepresentation of facts, concerning the applicability of the Act, or, admissibility of benefits to employees – regular, hired or contractual. 
• The Employer will ensure that contribution is paid in respect of all contract labour, badli and casual workers drawing wages upto Rs.7500/- a month.
• The employer will promptly report the date of closure of a factory/establishment to the ESIC Branch Office/Regional Office, preferably within seven days of such closure and clear ESI liabilities.
• The employer will report any change in business activity, address, ownership or the management to ESIC authorities forthwith.
• An employer will also ascertain the liability towards ESI dues, while taking over the ownership of a factory/establishment through purchase, gift, lease, licence or otherwise as the new owner is liable to discharge past liabilities.

(b) Rights of Employers 

• Exemption from applicability of Workmen’s Compensation Act, 1923 in respect of employees covered under the scheme.
• Exemption from applicability of Maternity Benefit Act, 1961 in respect of insured women.
• Right to be represented on ESI Corporation, Medical Benefit Council and other important committees of the Corporation that may be formed from time to time.
• Right to be supplied requisite Forms as may be required for fulfilling any obligation under the ESI Act.
• Right to recover employees share of contribution on the spot from the wages of insured persons.
• Right to appeal to Employees’ Insurance Court in case of any disputes.
• Right to seek exemption from the applicability of the Scheme in case benefits provided by the management are similar or superior to those available under the ESI Scheme.
• Right of access to all essential information concerning the applicability of the Act, benefits, contribution, inspections and other procedures.

SAFE GUARDS FOR INSURED EMPLOYEES 

i) Right to receive payment of any benefit under the Act shall not be transferable or assignable.

ii) Cash Benefits payable under the Act are not liable to attachment or sale in execution of any decree or order of any court.

iii) Employer shall not dismiss, discharge or reduce the wages or otherwise punish a covered employee during the period he/she is in receipt of Sickness Benefit or Maternity Benefit etc. 

iv) By reason of his liability to pay his share of contribution under the ESI Act, no employer shall directly or indirectly reduce the wages of a covered employee.

v) Right to register their grievances/complaints at any level for immediate redressal. 

vi) Right to approach ESI Court against any action/decision of the Medical Board etc. 

ROLE OF ESIC IN DELIVERY OF BENEFITS 

The ESIC is to ensure that: 

• The quality and quantity of benefits is as per norms and standards laid down by the Corporation for the purpose. 
• The benefits are made available within the given time frame to insured persons and beneficiaries.
• No harassment is caused to the beneficiaries across the counter at the grass root level by way of word or deed.
• All requisite information, procedural guidance etc. is made available to the beneficiaries for claiming benefits.
• All types of forms etc. are made available to the beneficiaries free of cost as may be required by them for filing claims etc.
• No beneficiary is exploited at any level in any way in the process of delivery of benefits.
• Office hours as notified for ESIC/ESIS establishments are strictly adhered to by the staff and displayed prominently so as to avoid any inconvenience being caused to the beneficiaries in smooth flow of benefits.
• Drugs, dressings, injections etc. as prescribed by the authorised doctors are made available timely.
• A complaint box is fixed within the office premises for posting written complaints.

ROLE OF ESIC IN SERVICING EMPLOYERS 

• To develop a responsive, purposive and productive relationship with employers.
• Seek their active involvement in the improvement of the scheme as a confidence building measure.
• Provide them necessary guidance in fulfilling their lawful obligations under the ESI Act.
• Make available to them requisite Forms and proformae as may be required by them from time to time.
• To ensure that any lax medical certification on part of ESIC does not bring down the productivity of a factory or establishment.
• To ensure that in case of any difficulty, doubt or misunderstanding employer is given a chance to be heard at an appropriate level.
• To ensure that all correspondence emanating from the employer is responded to, timely and objectively.
• To ensure that an employer is not being harassed by any official of the Corporation authorised to inspect the premises or the records.
• To ensure that any grievances received from employers are looked into promptly and pointedly for speedy redressal.

REDRESSAL OF PUBLIC GRIEVANCES

ESI Scheme, being a multi-discipline service intensive social security programme for workers, an estimated 3.5 lakh beneficiaries visit the service outlets at the grassroots level daily, either for treatment or for availing cash benefits. In such a highly interactive and dynamic system there is sufficient scope for any inadvertent or wilful harassment being caused to the beneficiaries. The Corporation has, therefore, set up an elaborate system for speedy redressal of public grievances and complaints at various levels. Grievances can be reported in writing, on telephone, by post or in person to any of the following officers

          Courtesy : www.esic.nic.in

©Federation of Andhra Pradesh Small Industries Associations