In detail about Employees state insurance act, 1948, and its benefits to employees and employers as well.

1. THE EMPLOYEES STATE INSURANCE ACT,
1948
NIVETHA C
IV TERM

2. OBJECTIVES
AIM
SCOPE
ADMINISTRATION
FINANCE
BENEFITS TO EMPLOYEES
BENEFITS TO EMPLOYERS
OTHER BENEFITS

3. ESI ACT, 1948
• It is a measure of Social Security and Health Insurance in the country.
• It provides certain cash and medical benefits to industrial employees in
case of sickness, maternity and employment injury.

4. SCOPE

5. The ESI Act of 1948
All power using factories other than
seasonal factories where more than 10
persons were employed.

6. The ESI (amendment) Act of 1975
 Small factories employing more than 10 persons, irrespective of power
usage.
 Shops
 Hotels and restaurants
 Cinemas and theatres
 Road-Motor transport establishments
 Newspaper establishments
 Private medical and educational institutions employing 20 or more in some
states.

7. ADMINISTRATION

8. Chairman
- Union Minister of Labour
Standing Committee
- Headed By Union Labour secretary
Director General
(Chief Executing Officer)
Finance
Commisioner
Medical
Commisioner
Director ESI
(State Govt.)
Medical Superintendents
State Medical Commisioners
Insurance
Commisioner
Actuary

9.  Beneficiaries: 602 lakhs by 31.3.11
 Corporation has set up a wide spread network of service outlets.
 1427 ESI dispensaries
 2100 panel clinics
 307 diagnostic centres.
 143 ESI hospitals
 43 hospital annexes with over 27,000 beds.

10. FINANCE
Employer
• 4.75% of total wage bill.
Employee
• 1.75% of wages. ( with exception of employees getting
daily wage of below Rs.70).
State Govt.
• 1/8th of total cost of medical care

11. BENEFITS TO EMPLOYEES
Medical
Benefit
Sickness
Benefit
Maternity
Benefit
Disablement
Benefit
Dependant’s
Benefit
Funeral
Expenses
Rehabilitation
Benefit

12. Medical Benefit
Full medical care including hospitalization, free of cost, to the insured persons in
case of sickness, employment injury and maternity.
 Out Patient Care
 Supply of drugs or dressings
 Specialist services in all branches of medicine
 Pathological and Radiological investigations
 Domiciliary services
 Antenatal, Natal and Post natal services
 Immunization services
 Family planning services
 Emergency services
 Ambulance Services
 Health education
 Inpatient Treatment

13. Mode of Delivery of Medical Care
Direct
Concentration
>1000
• Full-time medical Care
Less than 750
• ESI Dispensaries
Scattered
• Mobile ESI services
Indirect
Panel System

14. Sickness Benefit
Periodical cash payment to an insured person in case of sickness, if his
sickness is duly certified by an Insurance Medical Officer or Insurance Medical
Practitioner.
 Payable Upto a maximum period of 91 days.
 EXTENDED SICKNESS BENEFIT: Incase of long term sickness, an insured
person is entitled to Extended sickness benefit for a maximum period of 2
years.
 The insured person is protected from dismissal or discharge from service
by the employer during the period of sickness.

15. SOME OF THE CHRONIC DISEASES
INFECTIOUS DISEASES Tuberculosis, leprosy, chronic empyema, AIDS.
NEOPLASMS Malignant diseases.
ENDOCRINE, METABOLIC Diabetes mellitus with proliferative retinopathy/diabetic foot/nephropathy.
DISORDERS OF NERVOUS
SYSTEM
Monoplegia, Hemiplegia, paraplegia, Hemiparesis, Parkinson’s disease, spinal cord
compression, myasthenia gravis, glaucoma, detachment of retina.
CVS CAD, CCF, Cardiac valvular diseases, Cardiomyopathies.
CHEST DISEASES Bronchiectasis, Interstitial Lung Disease, COPD with CCF.
DIGESTIVE SYSTEM Cirrhosis of liver with ascites, chronic active hepatitis.
ORTHOPAEDIC DISEASES Dislocation of vertebra, prolapse of vertebral disc, non union or delayed union of fracture,
post traumatic surgical amputation of lower extremity.
PSYCHOSIS Schizophrenia, Endogenous depression, Manic depressive psychosis, Dementia.
OTHERS More than 20% burns, Chronic renal failure, Raynaud’s disease.

16. Maternity Benefit
 Payable by cash to an insured women for:
 Confinement: 12 weeks
 Miscarriage: 6 weeks
 Sickness arising out of confinement: 30 days

17. Disablement benefit
Cash Payment and free medical treatment, in the event of temporary or
permanent disablement as a result of employment injury.
 In case of temporary disablement: 70% of wages during the period of
disablement.
 In case of total permanent disablement: Life pension worked out on the basis of
loss of earning capacity determined by the medical board.

18. Dependant’s Benefit
 In case of death, as a result of employment injury, the dependants of an
insured person are eligible for periodic payments.
 Pension at the rate of 70% of wages is payable, shared by dependants in a
fixed ratio, on a monthly basis.
 An eligible son or daughter is entitled to dependant’s benefit up to the age of
18; the benefit is withdrawn if the daughter marries earlier.

19. Funeral expenses
Cash payment payable on the death of an insured person
towards the expenses on his funeral, the amount not exceeding
Rs.5000.

20. Rehabilitation
On a daily payment of Rs.123 (w.e.f. 01.01.06), the insured person
and his family members continue to get medical treatment after
permanent disablement, or retirement.

21. BENEFITS TO EMPLOYERS
 Exemption from the applicability of Workmen’s Compensation Act 1923.
 Exemption from Maternity Benefit Act 1961
 Exemption from payment of Medical allowance to employees and their
dependants or arranging for their medical care.
 Rebate under the Income Tax Act on contribution deposited in the ESI
account.
 Healthy work-force.

22. RAJIV GANDHI SHRAMIK KALYAN YOGNA
 New scheme provided for the employees under the ESI scheme.
 Came into effect from 1st April, 2005.
 This scheme provides unemployment allowance for the employees who are
rendered unemployed due to retrenchment/ closure of factory etc. after
fulfilling certain eligibility conditions.
 Employed under the establishment for a minimum period of 5 years.
 Payable upto 6 months.

23. Other Benefits:
 Medical Bonus
 Money order facilities
 Prevention of HIV/AIDS

24. References
 Park’s textbook of Preventive and Social
Medicine.
 www.esic.nic.in

25. THANK YOU