Labour LawsEmployees’ State Insurance Act, 1948Employees’ Provident Fund & Miscellaneous Provisions Act, 1952Employees’ Pension Scheme, 1995Shops & Establishment Act, 1948Labor Welfare Fund Act, 1953Payment of Bonus Act, 1965Payment of Gratuity Act, 1972Workmens Compensation Act, 1923Payment of Wages Act, 1936
Employees’ State Insurance Act, 1948Applicability1) All factories excluding seasonal factories employing 10 or more persons and working with electric power.2) All factories excluding seasonal factories employing 20 or more persons and working without electric power.3) Any establishment which the Government may specifically notify as being covered.4) Shop employing 20 or more persons.Note:As soon as the above conditions are fulfilled the employer should furnish the details in Form-01 to ESI office forregistration under the ESI Act, 1948 & Obtaining of the employer’s Code No.Eligibiligy1) Any person employed for wages (up to Rs. 6,500) in or in connection with the work of a factory or establishmentend.2) Any person who is directly employed by the employer in a factory or through his agent on work which is ordinarilypart of the work of the factory or incidental to purpose of the factory.Benefits1) Free medical treatment is offered to covered employees at hospital and dispensaries run by the ESI Corporation.2) About 7/12th of employees normal wage will be payable to him by ESI during sickness.3) Maternity benefit for 12 weeks of which not more than 6 weeks should be preceding confinement.4) Injury during/in course of employment resulting in temporary/permanent disablement entitles the coveredemployee to a regular payment to substitute his lost wages.5) Death during course of employment entitles specified dependents to a regular payment.6) One time payment of Rs. 1,500 to help meet funeral expenses.Penal Provisions1) For employees’ contribution : Imprisonment for minimum 2 yrs. to maximum 5 yrs. and/or fine of Rs. 25,000/- .2) For employer’s contribution : Imprisonment for minimum 6 months to maximum 3 yrs. and/or fine of Rs. 10,000/-BENEFITS AT A GLANCEBenefits Contributory Duration Rate To Whom Conditions Payable1} a) Sickness I.P. Should work 91 days in any As per S.B.R. Only to theBenefit. for wages for 78 two consecutive insured person days in the B.P. corresponding C.P.(wef 19-9- 98). b) Extended Continuous 124 days which 25% Above Only to thesickness benefit employment for may be extended S.B.R. insured personfor long term the period of two upto 309 days indiseases like TB, years. specified chronicleprosy, etc. cases during a period of three yrs. c) Enhanced Same as for 7 days for Twice the S.B.R Only to thesickness benefit Benefit (a)above vasectomy & 14 insured person(for under-going days forsterilization tubectomyoperation for extended in casesfamily planning) of post-
coperative complications etc.2} Disablement No Conditons In case of a) For temp. Only to disablement theBenefits temporary injured 40% above person S.B.R(employment disablement: asinjury) long as incapacity lasts & in case of permenant dis- ablement: for life time.EXPLANATION:Where more injuries than one are caused by the same accident, the rate of benefit payable under clauses (c) & (d)shall be aggregated but not so in any case as to exceed the FULL RATE and in cases of disablement not covered byclauses (a), (b), (c) & (d) at such rate, not exceeding the FULL RATE, as may be provided in the regulations.3}Dependent’s No condition To the WIDOW/S 3/5 of the FULL RATE, if there are 2 orBenefit during life time more widows, the amt. payable to the(employment until remarriage. widows shall be divided equally betweeninjury) To the legitimate the widows. or adopted 2/5 of the FULL RATE, if there are 2 or SON/S until he more sons, the amt. payable to the sons attains the age of shall be divided equally between the sons. 18yrs. Subject to a min of Rs. 14/-Benefits Contributory DurationRate To Whom Payable Conditions To the legitimate or -----do----- adopted unmarried Daughter/s until she attains the age of 18 yrs. or until marriage, whichever is earlier, In case the deceased person does not leave a widow or legitimate or adopted child. D.B. shall be payable to... a) Parent or grand 3/10th of the parent, for life FULL RATE b) Any other male 2/10th of the dependent, until FULL RATE he attains the age of 18 yrs. c) Any other female -----do----- dependent, until she attains the age of 18 yrs. Or until marriage whichever is earlier.N.B. An insured person whose PERMANENT DISABLEMENT has been assessed as final and who has been awardedpermanent disablement benefit at a rate not exceeding Rs. 1.50 per day may apply for a lumpsum payment and suchamount shall be determined by multiplying the daily rate of permanent disablement benefit by the figure indicated inCo. 2 of the Schedule III of the Regulations.Benefits Contributory Duration Rate To Whom Conditions Payable4} Maternity Payment of 12 weeks of Twice S.B.R. Only to theBenefits contribution for 70 which not more Subject t o insured days in one or two than 6 weeks can min person. consecutive precede the of Rs.20/- p.d. periods. expected date of confinement. 6 weeks for Medical bonus miscarriage or for of Rs.250/- medical where ESI termination of facility is not pregnancy available. Additional payment for one month for
Complications (pre or post) arising out of Pregnancy5} Medical No Condition From the date of Full Medical Person asInsured Benefit entry of an care including well as his/ employee into an hospitalisation her Family insurable Members as employment so defined u/s 2(11) long as he of the Act. remains in insurable employment and three after for certain additional period6} Funeral No condition One time lump Not more than To the eldestExpenses (i.e.merely by virtue sum payment Rs. 1,500/- surviving of being an insured member of the person) family of the deceased I.P. Or to the person who actually incurs the expenditure on the funeral of an I.P.7} Rehabilitation No condition For each day of Same as at Only to theAllowance which I.P. 1(a) Up to Rs. I.P. remains admitted 15 L in Artificial Limb for Center for Rehabilitation. fixation, repair or replacement of artificial limb.8}Medical No condition but an. Till the date on Medical Benefit IP and spouse.Benefit to insured I.P. has to pay Rs. which an I.P.persons who 10/- pm in lump would haveceases insurable sum for one year in attained the ageemployment on advance every year. ofaccount of superannuationpermanentdisablement.9}Medical 1) Insurable Till the time ----- InsuredBenefit to retired employment yearly person andInsured Period for a period of 5 contribution is his spouse years paid to the and Concerned 2) Payment of Office of the Office of the Corporation. Contribution @ Rs. 15/- PM in lump sum for one year in advance, each year.Other BenefitsSupply of special aids : Insured persons and members of their families are provided artificial limbs, hearing aids,artificial dentures, spectacles (for insured person only) & artificial appliances like spinal supports, cervical collars,walking callopers, crutches, wheel chairs and cardiac pace makers, dialysis/dialysis with kidney transplant etc. as partof medical care under the ESI Scheme.Records to be kept ready for ESI Inspection1. Attendance Register/Muster Roll.2. Salary/Wage Register/Payroll.3. EC (Employee’s & Employer’s Contribution) Statement.
4. Employees’ Register U/R 32 (Form 7). 5. Accident Register U/R 66. 6. Return of Contribution (RC-Form 6). 7. Return of Declaration Forms (RDF - Form 3). 8. Receipted Copies of Challans. 9. Books of Account viz Cash/Bank, Expense Register, Sales/Purchase Register, Petty Cash Book, Ledger, Supporting Bills asnd Vouchers, a/w Delivery Challans (if any).Employees’ Provident Fund & Miscellaneous Provisions Act, 1952 Applicability 1) Every establishment which is a factory engaged in any industry specified in Schedule 1 and in which 20 or more persons are employed and 2) Any other establishment employing 20 or more persons which Central Government may, by notification, specify in this behalf. (Infancy period of 3 years has been withdrawn by ordinance w.e.f.22-9-97) 3) any establishment employing even less than 20 persons can be covered voluntarily u/s 1(4) of the Act. Eligibiligy 1) Any person who is employed for work of an establishment or employed through contractor in or in connection with the work of an establishment. Benefits Employees covered enjoy a benefit of Social Security in the form of an unattachable, unwithdrawable (except employees and employers contribute equally throughout the covered persons employment. This sum is payable normally on retirement or death. Other Benefits include Employes’ Pension Scheme and Employee’s Deposit Linked insurance Fund. Penal Provisions Liable to be arrested without warrant being a cognisable offense. Defaults by employer in paying contributions or inspection/ administration charges attract imprisonment up to 3 years and fines up to Rs. 10,000 (S.14.) For any retrospective application, all dues have to be paid by employer with damages up to 100% of arrears. Benefits at a glance 1. Advance for Purchase of Dwelling Site. 2. Advance for Purchase of Dwelling House/flat. 3. Advance for Construction of a House. 4. Advance for Repayment of housing loan to State Govt. housing board or any other govt. recognised housing finance body. 5. Advance for IIIness viz. Hospitalisation for more than month, major surgical operations or suffering from TB, leprosy, paralysis, cancer, heart ailment etc. 6. Advance for Marriage of Self/Son/Daughter/Sister/Brother. 7. Advance for Post MatriculationEducation of Son/Daughter. 8. Advance for Damage to the property Due to Natural calamity (Flood Riot/Earthquake). 9. Advance for Member affected by cut in the supply of electricity. 10. Advance for Member who is physically handicapped. [ A member employee can also withdraw full amount standing to his credit. in fund (para 69).....] a) on Resignation.
b) On Retirement from the service on attaining the age of 58 yrs.c) on Retirement on account for permanent or total incapacity to work.d) immediately before Migration from India for permanent settlement abroad or for taking upemployment abroad.e) on Termination due to voluntary retirement Scheme, retrenchment, closure of the factory/establishment. Employees’ Pension Scheme, 1995DefinitionEmployees’ Pension Scheme is Pension Scheme for survivors, old aged and disabled persons. The earlier FamilyPension Scheme, 1971 offered only one type of benefit, namely, survivor’s benefit, i.e. (payment of pension towidow/widower on death of the member in service. On the other hand, the new scheme caters for three types ofcontingencies :—1. Survivor Pension : If death occurs during service period.2. Old Age Pension : Pension or Superannuation.3. Permanent Disability : In the event of member sufferingPension permanent disability while in service.CharacteristicsIn the scheme three scales of pensioners benefits have been offered according to the length of service. For service below 10 years Return of contribution on exit from employment - Table - D Example : Suppose a member exits from employment after four years of service his wage on exit2.1 is Rs. 4,000, (Return of contribution will be calculated as Rs. 4,000 x 4.18 of wages on exit) i.e., Rs. 16,720/- Service above 10 years but below 20 years In the first instance pension will be calculated by applying the formula, i.e.— Pensionable Salary X Pensionable service2.2 70 Say, a member has done 18 years of pensionable service, Pensionable Salary determined as Rs. 4,000/- pension payable to him will be Rs. 1,029/- Service over 20 years full pension according to the formula stated above. It is to be noted here that for rendering 20 years of pensionable service or more, member’s pensionable service shall2.3 in all cases be increased by adding 2 years. In other words, 20 years actual pensionable service will be treated as 22 years of pensionable service for calculation of pension. Special provisions for existing members special provisions have been made for calculation of pension in case of member who was a member of the ceased Family Pension Scheme 1971 and who has attained the age of 48 years on the 16th November, 1995 or a member who has attained2.4 the age of 48 years but is less than 53 years on 16th November, 1995, member who has attained the age of 53 years or more on the 16th November, 1995. In the aforesaid cases the formula for calculating pension will be as follows -2.4 a. Member has not attained the age of 48 years on 16.11.1995:Pension is determined by the above formula; i.e.,Pensionable Salary X Pensionable Service 70for the period of pensionable service rendered from the 16th Nov. 1995 or Rs. 635/- whichever is more plus pastservice benefits as under :-Sr. Years Of Past The Past Service Benefits payable on completion ofNo. Service 58 No. years of age on 16.11.95
Salary up to Rs. 2,500/- Salary more than Rs. p.m. 2,500/p.m.1. Up to 11yrs. Rs.80/- Rs.85/-2. More than 11 yrs. but Rs.95/- Rs.105/- up to 15 yrs.3. More than 15 yrs. Rs.120/- Rs.135/- 4. Beyond 20 yrs Rs.150/- Rs.170/-Subject to a minimum of Rs. 800/- per month provided the past service is 24 years. If the member’s aggregateservice is less than 24 years, Pension and the benefits computed as above will be reduced proportionately to aminimum of Rs. 450/- per month.2.4.b Member has attained the age of 48 years but is less than 53 years on 16.11.1995Pension as determined by the above mentioned formula; i.e.Pensionable Salary X Pensionable Service 70for the period of service rendered form 16.11.1995 or Rs. 438/- per month whichever is more plus past serviceas laid down in Para 12(3) subject to a minimum of Rs. 600/- per month, in case the past service is 24 years. Ifit is less than 24 years, pension payable and the past service benefit taken together shall be proportionately lesssubject to a minimum of Rs. 325/- p.m.2.4.c Member has attained the age of 53 years or more on 16.11.1995Pension as determined by the above mentioned formula i.e.Pensionable Salary X Pensionable Service 70for the period of service rendered form 16.11.1995 till the date of exit or Rs. 335/- p.m. whichever is more pluspast service benefit as provided in para 12(3) subject to a minimum of Rs. 500/- p.m. (both together) in casepast service period is 24 years. If it is less than 24 years pension payable and the past service benefit shall beproportionately lesser subject to a minimum of Rs. 265/- p.m.EARLY PENSION ON CESSATION OF EMPLOYMENTOld age pension on account of superannuation/retirement is normally payable on attaining the age of 58 years.However, member can opt for taking earlier than 58 years on his exit from employment but under nocircumstances pension will be payable before the age of 50 years. A member who desires to draw monthlypension from a date earlier than 58 years of age will be allowed to draw a monthly reduced pension. The amountof pension in such a case shall be reduced at the rate of 3% for every year the age falls short of 58 years.SCHEME CERTIFICATEThere are occasions when a member may leave employment and or may move from a covered establishment toan uncovered establishment before he reaches the date of superannuation, he may opt for a Scheme Certificate.The certificate will indicate his pensionable salary and the amount of pension due on the date of exit fromemployment. If the member is subsequently employed in a covered establishment. his pensionable service in thescheme certificate will be taken into account for working out his full pensionable service.WIDOW PENSION5.1 Widow pension is of three categories — one of death of the member during service, second on the death of the member after leaving service but before attaining the age of 58 years and the third in case of death of the member after commencement of payment of monthly members pension.5.2 Widow pension on death of the member during the service is equal to monthly members pension.5.3 The essential conditions for grant of widow pension are as follows:-5.3a. The death of the member occurred while in service.5.3b. The member has contributed at least one month’s contribution.5.3c. The member had not attained the age of 58 years.5.3.d. The death of the member had taken place before the commencement of monthly members pension.Example 1:Mr. ‘X’, a worker in an establishment, became member of the Employees Pension Scheme on 2nd January, 1996.He died in February 1996 after a short illness. His wages at the time of death were Rs. 1,500/- p.m. He leftbehind his widow aged 22 years and a child aged 1 year What will be the widows pension in this case? It isconfirmed that pension contribution for Mr. ‘X’ was paid by the employer for the month of January 1996.Widows pension entitlement.(i) Pensionable service One month Pensionable salary Rs. 1500/-
Either (ii) Pension according to the formula : Pensionable Service X Pensionable Salary i.e. 1 X 1500 70 12 70 = 1.78Or (ii) Minimum pension payable as per para 16(2)(a)(i) of the Scheme - Rs. 450/- p.m.Or (iii) The amount indicated in-table ‘C’ — Rs. 718/- per month whichever is more. Since (iii) is more than (i) & (ii), Widow pension will be fixed at Rs. 718/- per month for life orremarriage of the widow, whichever is earlier. (iv) For the child, 25% of the widow pension will be granted as monthly pension; i.e., 25% of Rs. 718= Rs. 179.50 or Rs.180/- p.m., till 25 years of age.Example 2:Mr. ‘Y’ joined Family Pension Scheme in January 1972. He died while in service, say, on 30 March, 1998. He wasdrawing a salary of Rs. Rs. 2,500/- p.m. from January, 97 till death. He had attained the age of 48 years at thetime of his death. He left behind the widow, two sons - one aged 16 years, one 7 year and one daughter aged20 years. What would be the widow pension and children pension, payable?(i) Mr. ‘Y’ had done 26 years 3 months of pensionable service at the time of his death. In calculation of eligibleservice for pension, fraction of three months will be ignored as per, explanation to para 9(a) of the Scheme andthus eligible service will be taken as 26 years only. The average 12 months. salary at the time of his death wasRs. 2,500/-Hence member’s monthly pension will be :— Either Pensionable Service X Pensionable Salary 70i.e. (i) 26 x 2500 = Rs. 928.57 or Rs. 929/- p.m. 70Or (ii) In term of para 16(2)(a)(ii)—Rs. 250/- p.m.5.4 Children Pension.5.4- The member left behind three children one daughter aged 20 years, one son aged 16 years’ andi. the other son age 7 years. To start with only the elder two, the daughter and the elder son will get pension. The daughter will get pension for 5 years by which time she will be 25 years for age after 5 years of the vesting of pension. After the daughter ceases to be the beneficiary, the youngest child, then age 12 years, will start receiving pension till the age of 25 years.5.4- The amount of children pension will be @ 25% of widow pension for each of the two children. Viz.ii. 25%+25% of Rs.1,087 or Rs. 272+Rs. 272 for two children.WIDOW PENSION AFTER COMMENCEMENT OF MONTHLY PENSION6.1 In case of death of the member after vesting of pension, the amount of widow pension is payable @ 50% of the monthly member’s pension subject of minimum of Rs. 250/- p.m. for example. Mr. ’Z’ a pensioner, dies at the age of 66 years leaving behind his widow aged 62 years. Mr. ’Z’ drawing pension @Rs. 1000/- p.m. The widow pension in this case will be Rs. 500/p.m.6.2 In case the member leaves behind any child less than 25 years of age, children pension is payable for each equal to 25% of the widow pension subject to a minimum of Rs. 115/p.m.COMMUTATION OF PENSION(This facility is available three years after the commencement of the scheme, i.e. w.e.f. 16th November 1995.)The member may commute one-third of his monthly pension. The commuted value shall be 100 times themonthly pension. Balance Pension shall be paid on monthly basis. He may also opt for return capital u/p 13 ofthe EPS of the balance pension payable.OPTION FOR RETURN OF CAPITALThe member may opt to draw revised pension and avail of return of capital under any one of the threealternatives as per the table shown u/p 13 of the scheme.
Shops & Establishment Act, 1948Shops & Establishment Act, 1948 Registration:– Form A – Within 31 days of its commencement Renewal of :– Form B – Last date 15th December Registration :– Notice of Change :– Form E I. Fees for Registration & Renewal of Registration Certificate:– Shops & Establishment having Registration Fees for Renewal of Trade Fees per Regis- Refuse year tration Certificate per Charges per year year Nil Employees Rs. 50/- Rs. 50/- Rs. 150/- 1 to 5 Employees Rs. 150/- Rs. 150/- Rs. 450/- 6 to 10 Employees Rs. 300/- Rs. 300/- Rs. 900/- 11 to 20 Employees Rs. 600/- Rs. 600/- Rs. 1800/- 21 to 50 Employees Rs. 1500/- Rs. 1500/- Rs. 4500/- 51 to 100 Employees Rs. 3000/- Rs. 3000/- Rs. 9000/- 101 and above Employees Rs. 4000/- Rs. 4000/- Rs. 12000/- II. Fees for Notice in Change, to be submitted along with Form E Category of Establishments Fees Commercial Establishment Rs. 50/- Shops having Employee Rs. 50/- Shop having No Employee Rs. 50/- Residential Hotel Rs. 50/-
Restaurants & Eating Houses Rs. 50/-Theaters& Other Places of Public Rs. 50/-Amusements or Entertainment Rs. 50/- Payment of Bonus Act, 1965Applicability(a) Every factory (as def. in Factories Act), & (b) Every other establishment in which 20 or more persons (less than 20but 10 or more if appropriate Govt. notifies) are employed on any day subject to certain exemptions.ii) Employees drawing remuneration of Rs. 3,500/- or more and those who have worked for less than 30 days are noteligible to receive bonus under the Act.iii) Bonus to be paid within eight months from the expiry of the accounting year.Eligibilityi) Every person (other than an apprentice) drawing salary up to RS 3,500 per month.Ii) Every person drawing salary between RS 2,501/- and RS 3,500/- per month. The bonus payable to him is to becalculated as if his salary were RS 2,500/- p.m.Benefitsi) Subject to other provisions :— Minimum bonus shall be 8.33% of salary/wages earned or RS 100 whichever ishigher.Ii) If allocable surplus exceeds the amount of minimum bonus, then bonus shall be payable at higher rate subject to amaximum 20% of salary/wages.Iii) Computation of bonus is to be worked out as per Schedule I to IV of the Act.Penal ProvisionsImprisonment up to 6 months and or fine up to RS 1000/-.
Payment of Gratuity Act, 1972Applicability1. Every factory (as defined in Factories Act), mine, oilfield, plantation, port and railway.2. Every shop or establishment to which Shops & Establishment Act of a State applies in which 10 or morepersons are employed at any time during the year end.3. Any establishment employing 10 or more persons as may be notified by the Central Government.4. Once Act applies, it continues to apply even if employment strength falls below 10.Eligibility1. Any person employed on wages/salary.2. At the time of retirement or resignation or on superannuation, an employee should have rendered continuousservice of not less than five years,3. In case of death or disablement, the gratuity is payable, even if he has not completed 5 years of service.Benefits1. The quantum of gratuity is to be computed at the rate of 15 days wages (7 days wages in case of seasonalestablishments) based on rate of wages last drawn by the employee concerned for every completed year ofservice or a part thereof exceeding 6 months.2. The total amount of gratuity payable shall not exceed the prescribed limit.3. In case where higher benefit of gratuity is available under any gratuity scheme of the Co., the employee willbe entitled to higher benefitCalculation of Gratuity1. Gratuity = Monthly Salary x 15 days x No. of yrs. of service 262. Max. Gratuity payable under the Act is Rs. 3,50,000/- (w.e.f. 24-9-1997)Penal ProvisionsNonpayment of gratuity payable under the Act is punishable with imprisonment up to 2 years (minimum 6months) and/or fine up to RS 20,000/-. Other contravention/offenses attract imprisonment up to 1 year and/orfine up to RS 10,000. Workmens Compensation Act, 1923ApplicabilityEmployer includes any person whether incorporated or not and any agent of employer and when services aretemporarily lent or let on hire to another person, then means such other person.EligibilityAny workman who is injured by accident arising out of and in the course of his employment in specified list ofemployment contracts any disease specified therein as an occupational disease peculiar to that occupation.Benefits: Amount of compensation shall be payable by the employeri) Where death results from injury 40% of monthly wages x relevant factor or Rs. 20,000/- whichever is more.ii) Where permanent total disablement results from the injury 50% of monthly wages x relevant factor or Rs. 24,000/-whichever is more (relevant factor depends upon the age of a workman)iii)Where permanent, partial disablement or temporary disablement results from injury as per prescribed schedule.Penal ProvisionsAny contract by a worker waiving his right to be compensated under this Act is null and void. Compensation should bepaid early–delay beyond 1 month attract interest @ 6% p.a. and penalty of up to 50% of the compensation. Certainother offenses attract fine up to RS 5,000
Payment of Wages Act, 1936Applicabilityi) Every person employed in any factory, upon any railway or through subcontractor in a railway and a personemployed in an industrial or other establishment.ii) The State Government may by notification extend the provisions to any class of person employed in anyestablishment or class of establishments.EligibilityEvery person who is employed in any of the above mentioned establishments and who is drawing less than Rs. 1,600per month.Benefits : the Act prescribes fori) The regular and timely payment of wages (on or before 7th day or 10th day after last day of the wage period inrespect of which the wages are payable)ii) Preventing unauthorised deductions being made from wages and arbitrary fines.Penal ProvisionsPenalties are from Rs. 200-1000. Repeat offenses attract 1 to 6 months imprisonment and fine from Rs. 500-3000.Delay wage payments attract penalty of Rs. 100 per day of delay.