ESI Like most of the social security schemes, the world over, ESI scheme is a self-financing health insurance scheme. Contributions are raised from covered employees and their employers as a fixed percentage of wages. Presently covered employees contribute 1.75% of the wages, whereas as the employers contribute 4.75% of the wages, payable to the insured persons. Employees earning less than and up to Rs. 50 per day are exempted from payment of contribution. The contribution is deposited by the employer in cash or by cheque at the designated branches of some nationalized banks. The responsibility for payment of all contributions is that of the employer with a right to deduct the employees share of contribution from employees’ wages relating to the period in respect of which the contribution is payable. There are two contribution periods each of six months duration and two corresponding benefit periods. Cash benefits under the scheme are generally linked with contribution paid. Contribution period - 1st April to 30th September, its corresponding Cash Benefit period is 1st January to 30th June of the following year. Contribution period - 1st October to 31st March, its corresponding Cash Benefit period is 1st July to 31st December of the following year. Certification of Return of Contribution by Auditor Regulation 26 of Employees’ State Insurance (General) Regulations, 1950 was amended by Notification No.N-12/13/1/2008-P&D to include certain details to be mentioned in the Return of Contribution to be submitted by employers. The salient features of amendments made in the Returns of Contribution are as under:- 1. Self-declaration by Employers regarding maintenance of records and registers, submission of Declaration Forms, employees engaged directly or through immediate employers and wages paid to the workers. 2. All the Employers employing 40 and more employees shall have to append a certificate duty certified by a Chartered Accountant, in the revised format of Returns of Contribution. 3. The Employers employing less than 40 employees will have to provide self- certification without any certification from the Chartered Accountants in Return of Contribution. The Chartered Accountant should certify that he has verified the return from the records and registers of the company. This notification has come into force with effect from 01-04-2008. Benefits under the Scheme Employees covered under the scheme are entitled to medical facilities for self and dependants. They are also entitled to cash benefits in the event of specified contingencies resulting in loss of wages or earning capacity. The insured women are entitled to maternity benefit for confinement. Where death of an insured employee occurs due to employment injury or occupational disease, the dependants are entitled to family pension. Various benefits that the insured employees and their dependants are entitled to, the duration of benefits and contributory conditions thereof are as under: • Medical benefits o From day one of entering insurable employment for self and dependants such as spouse, parents and children own or adopted. o 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. • Sickness benefits o 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 insurable medical officer/ practitioner. o The benefit becomes admissible only after an insured has paid contribution for at least 78 days in a contribution period of 6 months. o Sickness benefit is payable for a maximum of 91 days in two consecutive contribution period. • Extended sickness benefit o 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. o For entitlement to this benefit an insured person should have been in insurable employment for at least 2 years. He/ she should also have paid contribution for a minimum of 156 days in the preceding 4 contribution periods or say 2 years. o ESI is payable for a maximum period of 2 years on the basis of proper medical certification and authentication by the designated authority. o Amount payable in cash as extended sickness benefit is payable within 7 days following the submission of complete claim papers at the local office concerned. • Enhanced sickness benefit o This cash benefit is payable to insured persons in the productive age group for under going sterilization operation, viz., vasectomy/ tubectomy. o The contribution is the same as for the normal sickness benefit. o Enhanced sickness benefit is payable for 14 days for tubectomy and for seven days in case of vasectomy. • Maternity benefit o Maternity benefit is payable to insured women in case of confinement or miscarriage or sickness related thereto. o For claiming this an insured woman should have paid for at least 70 days in 2 consecutive contribution periods i.e. 1 year. o The benefit is normally payable for 12 weeks, which can be further extended up to 16 weeks on medical grounds. o The rate of payment of the benefit is equal to wage or double the standard sickness benefit rate. o The benefit is payable within 14 days of duly authenticated claim papers. • Disablement benefit o Disablement benefit is payable to insured employees suffering from physical disablement due to employment injury or occupation disease. • Dependants benefit o Dependants benefit [family pension] is payable to dependants of a deceased insured person where death occurs due to employment or occupational disease. o A widow can receive this benefit on a monthly basis for life or till remarriage. o A son or daughter can receive this benefit till 18 years of age. o Other dependants like parents including a widowed mother can also receive the benefit under certain condition. o The rate of payment is about 70% of the wages shareable among dependants in a fixed ratio. o The first installment is payable within a maximum of 3 months following the death of an insured person and thereafter, on a regular monthly basis. • Other benefits like funeral expenses, vocational rehabilitation, free supply of physical aids and appliances, preventive health care and medical bonus. Obligations Of Employers 1. The employer should get his factory or establishments registered with the E.S.I. Corporation within 15 days after the Act becomes applicable to it, and obtain the employers Code Number. 2. The employer should obtain the declaration form from the employees covered under the Act and submit the same along with the return of declaration forms, to the E.S.I. office. He should arrange for the allotment of Insurance Numbers to the employees and their Identity Cards. 3. The employer should deposit the employees’ and his own contributions to the E.S.I. Account in the prescribed manner, whether he has sufficient resources or not, his liability under the Act cannot be disputed. He cannot justify non-payment of E.S.I. contribution due to non-availability of finance. 4. The employer should furnish a Return of Contribution along with the challans of monthly payment, within 30 days of the end of each contribution period. 5. The employer should not reduce the wages of an employee on account of the contribution payable by him (employer). 6. The employer should cause to be maintained the prescribed records/registers namely the register of employees, the inspection book and the accident book. 7. The employer should report to the E.S.I. authorities of any accident in the place of employment, within 24 hours or immediately in case of serious or fatal accidents. He should make arrangements for first aid and transportation of the employee to the hospital. He should also furnish to the authorities such further information and particulars of an accident as may be required. 8. The employer should inform the local office and the nearest E.S.I. dispensary/hospital, in case of death of any employee, immediately. 9. The employer must not put to work any sick employee and allow him leave, if he has been issued the prescribed certificate. 10. The employer should not dismiss or discharge any employee during the period he/she is in receipt of sickness/maternity/temporary disablement benefit, or is under medical treatment, or is absent from work as a result of illness duly certified or due to pregnancy or confinement. Records To Be Maintained For Inspection By ESI authorities 1. Attendance Register / Muster Roll 2. Salary / Wage Register / Payroll 3. EC (Employee’s & Employer’s Contribution) Statement 4. Employees’ Register 5. Accident Book 6. Return of Contribution 7. Return of Declaration Forms 8. Receipted Copies of Challans 9. Books of Account viz. Cash/Bank, Expense Register, Sales/Purchase Register, Petty Cash Book, Ledger, Supporting Bills and Vouchers, Delivery Challans (if any). 10. Form of annual information on company Employees Insurance Court Any dispute arising under the ESI Act will be decided by the Employees Insurance Court and not by a Civil Court. It is constituted by the State Government for such local areas as may be specified and consists of such number of judges, as the Government may think fit. It shall adjudicate on the following disputes and claims. Disputes as to: i. Whether an employee is covered by the Act or whether he is liable to pay the contribution, or ii. The rate of wages or average daily wages of an employee, or iii. The rate of contribution payable by the employer in respect of any employee, or iv. The person who is or was the principle employer in respect of any employee, or v. The right to any benefit and the amount and duration thereof, or vi. Any direction issued by the Corporation on a review of any payment of dependents benefit, or vii. Any other matter in respect of any contribution or benefit or other due payable or recoverable under the Act. Claims as to i. Recovery of contributions from the principal employer, ii. Recovery of contributions from a contractor, iii. Recovery for short payment or non-payment of any contribution under section 68, iv. Recovery of the value or amount of benefits received improperly under section 70, v. Recovery of any benefit admissible under the Act No dispute shall be admitted unless the employer deposits with the Court 50% of the amount due from him as claimed by the Corporation. An appeal will lie to the High Court within 60 days against an order of the Employees Insurance Court if it involves a substantial question of law
Posted on: Tue, 22 Jul 2014 11:04:16 +0000
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