Employee’s State Insurance is a self-financing social security and health insurance scheme for Indian workers. This fund is managed by the Employees’ State Insurance Corporation according to rules and regulations stipulated there in the ESI Act 1948, IT’s a comprehensive social security program for workers.
The ESI scheme provides access to medical treatment, medical facilities, cash compensation and other support for insured persons in the event of medical contingencies, such as sickness, maternity, death or disablement due to employment injury and occupational disease.
ESI registration and monthly compliance are mandatory in India for businesses and establishments employing 10 or more persons. The rates are revised from time to time. Currently, the employee’s contribution rate (w.e.f. 1.1.97) is 1.75% of the wages and that of employers is 4.75% of the wages paid/payable in respect of the employees in every wage period
The ESI scheme is applicable to all factories and other establishments as defined in the Act with 10 or 20 persons employed in such establishment and the beneficiaries’ monthly wage does not exceed Rs 21,000 are covered under the scheme. Whether the employer has employed 10 or 20 employees, all employees employed by the employer, agnostic of the salary are reckoned.
The scheme under the act also supports restaurants, motor road transports, newspaper establishments and undertakings, movies and purview theatres, hotels, shops.
The applicability of the threshold for coverage of establishment is explained below:
Medical Benefit full medical facilities for self and dependants are admissible from day one of entering insurable employment. Whereas, the primary, outpatient, inpatient and specialist services are provided through a network of Panel clinics, ESI dispensaries and hospitals, super speciality services are provided through a large number of advanced empanelled medical institutions on a referral basis
Eligibility to Medical Benefit
· From day one of entering insurable employment for self and dependants such as spouse, parents and children, own or adopted.
· For self and spouse on superannuation subject to having completed five years in insurable employment on superannuation or in case of having suffered permanent physical disablement during the course of insurable employment.
· The rate of contribution for superannuated/disabled IPs is Rs.120/- per annum payable in a lump sum at a Branch office for availing full medical care for self and spouse.
Sickness Benefit is payable to an insured person in cash, in the event of sickness resulting in absence from work and duly certified by an authorised insurance medical officer/practitioner. ESIC provides 70% of average daily wages in cash during medical leave, up to 91 days in two consecutive benefit periods.
Eligibility to Sickness Benefit
· The benefit becomes admissible only after an insured employee has paid a contribution for at least 78 days in a contribution period of six months.
· Sickness Benefit is payable for a maximum of 91 days in two consecutive contribution periods (one year)
Extended Sickness Benefit is payable to insured persons for the period of certified sickness in case of specified 34 long-term diseases that need prolonged treatment and absence from work on medical advice.
Eligibility to Extended Sickness Benefit
· For entitlement, to this benefit, an insured person should have been in insurable employment for at least two years. He/she should also have paid a contribution for a minimum of 156 days in the preceding four contribution periods or say two years.
· The worker can claim extended sickness benefit for up to two years on the basis of proper medical certification and authentication by the designated authority.
· The amount payable in cash as extended sickness benefit is equal to about 80 per cent of the daily wages.
Enhanced Sickness Benefit equal to full wage is payable to insured persons is payable to the female worker for 14 days and for 7 days in the case of male workers.
Maternity Benefit is payable to insured women in case of confinement or miscarriage or sickness related thereto. ESIC provides 100% of average daily wages in cash up to 26 weeks in confinement and 6 weeks in case of miscarriage, during maternity leave and 12 weeks for commissioning mother and adopting mother.
Eligibility to Maternity Benefit
· For claiming the benefit an insured woman should have paid the contribution for at least 70 days in two consecutive contribution periods i.e. one year.
· The benefit is normally payable for 24 weeks.
· The rate of payment of the benefit is equal to full wages or double the Standard Sickness Benefit rate.
· The benefit is payable within 14 days of submission of duly authenticated the claim papers.
Disablement Benefit is payable to insured employees suffering from physical disablement due to employment injury or occupational disease.
Eligibility to Disablement Benefit
· An insured person should be an employee on the date of the accident.
· Temporary disablement benefit @ 90 per cent of the wages is payable till temporary disablement lasts and is duly certified by authorised insurance medical officer.
· In the case of permanent disablement, the cash benefit is payable for life. Amount payable is worked out on the basis of loss of earning capacity determined by a medical board.
· Disablement benefit is payable within one month of submission of the complete claim papers.
Dependants benefit (family pension) at the rate of 90% of wage in the form of monthly payment is payable to dependents of a deceased insured person where death occurs due to employment injury or an occupational disease.
Eligibility to Disablement Benefit
· A widow can receive this benefit on a monthly basis for life or till her re-marriage.
· A son or daughter can receive this benefit till eighteen years of age.
· Other dependants like parents including a widowed mother etc. can also receive this benefit under certain conditions.
· The first instalment is payable within a maximum of three months following the death of an insured person and thereafter, on a regular monthly basis.
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.
Rajiv Gandhi Shramik Kalyan Yojana: This scheme of Unemployment allowance was introduced w.e.f. 01-04-2005. An Insured Person who becomes unemployed after being insured three or more years, due to the closure of factory/establishment, retrenchment or permanent invalidity are entitled to:-
ESIC Provides monthly cash allowance for a duration of maximum 24 months in case of involuntary loss of employment or permanent invalidity due to non-employment injury.
· Unemployment Allowance equal to 50% of wage for a maximum period of up to Two Years.
· 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.