The Employees State Insurance Act of 1948 aims to provide social security benefits such as sickness, maternity, and disablement benefits to employees covered under the scheme. The act applies to various establishments employing a specified minimum number of persons and includes extensive provisions for registration, contributions, and administration by the Employees State Insurance Corporation. Key benefits include medical treatment, funeral expenses, and protective measures against employer retaliation during periods of benefit receipt.

1. The Employees State Insurance
Act,1948

2. Introduction
• Social insurance of india
• The Adakar plan- Workmen’s State Insurance
Bill, 1946
• A social welfare legislation with the objective
of providing benefits to employees- sickness,
maternity and employment injury.
• Act tries to attain socio-economic justice
enshrined in DPSP under part IV of the
constitution

3. Benefits of the Act
To Insured Person:
• Sickness Benefit
• Maternity Benefit
• Disablement Benefit
• Dependents Benefit
• Medical Benefit
• Funeral Expenses

4. • Different from Factories Act
• Extensive regulations have been framed under
this act to identify the employees who would
be entitled to the benefits.
• ESI Corporation

5. Applicability of the Act
• Under Section 1(4), implementation of the scheme is
territorial
• The act applies to all factories using power and employing
20 or more persons on wages
• Provisions have also been extended to:
o Smaller power using factories employing 10-19 persons
o Non-Power using factories employing 20 or more persons
o Shops
o Hotels and Restaurants
o Cinemas, including preview theatres
o Newspaper Establishments
o Road motor undertaking employing 20 or more persons

6. • Does not apply to:
• Mine or railway shed
• Specified seasonal factories

7. Some Definitions
• Employee- under Section 2(9), to any person employed on
wages, in connection with the work of a factory to which
this act applies.
• Remuneration excluding over time does not exceed
Rs.6500 pm are covered
• No distinction between casual and temporary or between
technical or non technical employees
• Employed by the principal employer or contractor on the
factory premises or outside by the principal employer are
all included in this act
• Includes Administrative staff and persons engaged in the
raw materials or the distribution or the sale of the products

8. Wages
• Remuneration paid in cash, if the terms of the contract
are fulfilled and includes any payment in any period of
authorized leave, lockout or strike which is not illegal
or lay off and includes other remuneration paid at
intervals not exceeding two months.
• It does not include:
• Contribution paid to the PF or Pension Fund
• Travelling allownace or value of travelling concession
• Sum paid to defray special expenses
• Gratuity payable on discharge

9. Contributions
• Main source is one eighth share by State Govt
towards the cost of medical care
• Employees contribution calculated individually
for each employee at 1.75% of the wages
paid/payable for every wage period.
• Employers contribution is calculated at the 4.75%
of the total wages paid to all the employees
covered under ESI Scheme.
• Employees whose avg daily wage is below Rs15
are exempted from payment of their contribution

10. • Contribution period and benefit period is fixed
for the purpose of paying contributions
• Contribution benefit period from 1st
April to
30th
September, the corresponding period will
be from 1st
Oct to 31st
March of the following
year, the corresponding benefit period shall
be from 1st
july to 31st
December.
• For newly employed person, first contribution
period commences on the expiry of 9 months
from the said sate.

11. Registration
• Registration of a establishment with ESI is the
responsibility of the employer under Section 2-A
of the act
• Within 15 days after the act becomes applicable
the owner is liable to furnish to the appropriate
regional office.
• Form 01
• Forms for the registration of employees are the
declaration form and rerun of the declaration
forms.

12. • The statutory registers to be maintained up to
date are:
o Register of Employees
o Accident Book in which every accident to
employees during the course of employment
is recorded
o Inspection Book
• As and when required certain other forms
such as ESIC32, ESIC37, ESIC53, ESIC71,
ESIC72, ESIC 86, ESIC105

13. Administration
• The scheme is administered by a corporate body called
ESIC
• Comprises of- employees, employers, the parliament,
central and state governments and medical profession.
• Responsible for- policy planning, decision making and
overseeing the functioning of the scheme through a
standing committee drawn from main corporate body.
• Headed by- Union Minister of Labour as its Chairman
• CEO is the DG who is the ex-officio member of the
corporation and its standing committee.
• Responsible for- formulation of policy, overall supervision,
co-ordination and liaison with Central and State Govt.
• ESIC has setup local offices all over the country for the
implementation of the scheme.

14. Benefits
• Sickness and extended sickness benefit-
• Standard benefit rate for 91 days in any two
consecutive benefit period.
• Eligibility criteria
• Extended sickness benefit for special long term
ailment like T.B, leprosy, mental disease
• Benefit at a rate which is 40% higher than the
standard benefit rate, rounded to the next higher
multiple of 5 paise for a period of 124/309 days.
• For Deserving cases duration may increase from
400 days to a maximum period of 2 years

15. Maternity Benefit
• Only insured woman is entitled to this benefit
• At double the standard benefit rate
• Equal to full wages for a period of 12 weeks of which not
more than 6 weeks shall precede the expected date
• Additional benefit in case of miscarriage.
• In case of sickness arising out of miscarriage, pregnancy,
confinement and premature birth additional benefit is given
for a period of one month
• Eligibility- 80 days in one or more preceding contribution
periods of one year

16. Disablement Benefit
• Member suffering injury in the course of employment will
receive free medical treatment and temporary disablement
benefit in cash.
• It is 70% of the wages as long as temporary disablement lasts,
provided it has lasted for not less than 3 days excluding the
day of accident.
• In case of permanent disablement life pension at full rate that
is 70% of his wages.
• Wages are paid on Sundays as well

17. Dependent’s Benefit
• Timely help to the eligible dependents of an insured member
who dies as a result of an accident or an occupational disease
arising out of in the course of employment.
• 40% pension rate more than the standard benefit rate i.e.
70% of wages will be paid periodically to the widow and
children.
• Available to the widow as long as she lives or until she
marries, to sons and daughters upto the age of 18 without
any proof of education.
• If widow, child is not left then benefit is given to parents or
grandparents but equivalent to 3/10ths of the full rate.
• 2 or more parents and grandparents the benefit is divided
equally between them.

18. Funeral and Medical Benefit
• 1968- funeral benefit
• Amount not exceeding Rs.1500 is payable to the eldest
surviving member of the deceased insured person. Time
period is 3 months from the death.
• Medical benefit consists of free medical attendance and
treatment of insured persons and their families.
• Benefits is divided into 3 parts:
o Restricted Medical Care
o Expanded Medical Care
o Full Medical Care

19. Restrictions
• Receiving any benefits provided under this act, he is not
entitled to receive any similar benefit.
• The insured person will not be entitled to receive for the
same period:
o Both sickness and maternity benefits
o Both sickness and disablement benefit for temporary
disablement
o Both maternity and disablement benefit for temporary
disablement
• If a person is entitled to more than one benefits he has an
option to select any one of them

20. Protection
• The employer cannot dismiss, discharge or punish any
employee during the period that person is in receipt of
sickness, maternity or disablement benefit.
• An employer can discharge or dismiss an employee on due
notice if:
o He/she received temporary disablement and remained
absent for 6 or more months continuously
o He/she is under medical treatment for sickness other than T.B
or a disease arising out of pregnancy and has remained
absent continuously for 6 months or more
o He/she is under medical treatment for T.B. or a malignant
disease and has remained absent continuously for 18 months

21. Penalties and Damages
• A person commits an offence after having been convicted by
court he will be punishable for every such subsequent offence
with imprisonment for a term which may extend upto 2000rs
or both
• Subsequent offence is for failure to pay any contribution then
person is liable for a term of imprisonment which may extend
to 1 year and not less than 3 months and fine of Rs4000

22. Miscellaneous
• Cash benefits payable under the ESIC are not liable to
attachment or sale in execution of any court decree or order.
• Any dispute arises under this Act, the matter is decided by the
Employee Insurance Court and not by Civil Court
• An appeal will lie in the High Court from an order of the
Employees Insurance Court, it it involves substancial question
of law.
• Period of limitation for appeal is 60 days.