Labour Laws

Employees’ State Insurance

Under the ministry of labour and employment, the government of India an autonomous corporation was set up by ESI act which is known as employee state insurance corporation and launched a scheme un employee state insurance act 1948.

Employee State Insurance

The employee state insurance is one type of an integrated social safeguard system having multidimensional and customized to offer security and protection to the employees of India and respective states. The said act was introduced as E.S.I ACT 1948.

This act basically focuses on the safety of employees by providing help in case of sickness, death in the work field, injury, maternity, etc. in this scheme complete medical care for the insured person along with dependents will be benefitted.

Employee State Insurance Guidelines

  • For all employees earning 21000 or less than that per month as wages, the employer contributes 4.75% and the employee contributes 1.75% making it total share of 6.75%. That means both are liable under ESIS.
  • According to the rules and regulation, all factories are mandatorily liable to register their employees under ESI. all govt establishments as well and shops or offices employing 20 persons or more will register themselves.
  • But as everything has exemptions, this law has certain exemptions. They are seasonal factories activities like cotton ginning, jute pressing, decoration of grounds or factories engaging workers not more than seven months in a year are exempted from registering under ESI.

ESI corporation


Employee State Insurance Features

  • It includes all medical care facilities for the person who is insured as well as dependent members of his/her family from day one.
  • It includes medical coverage for a certain specific illness which includes cash benefits. This covers 70% of the employee’s wages until 91 days. For this benefit to avail, the workers required to contribute at least 78 days for a period of 6 months.
  • There is a special benefit for women employees regarding maternity leave or for medical problem in pregnancy etc. For maternity leave, there is a period of 26 weeks which can be extended by one month. But there is no change in wage slab. They will get at the rate of full wage to contribution for 70 days.
  • For an unemployed person, this scheme is also applicable. They are also eligible for being insured for at least three years, provided they will disclose details regarding their previous place of work and retrenchment letter. In such case, a monthly payment of 50%of their wage in cash for a maximum of 2 years can be availed by the employees.

Employee State Insurance Instruction

  • A new employer must be informed of the ESI registration number if the insurer switches from one company to another company. This process will make insurer eligible for getting the same benefits which were given in the previous company, if and when needed.
  • For the social security, personal identification card or named as Pehchan card serves as a channel towards this scheme. it has to be prevented from getting damaged or lost by the cardholder.
  • In case the card is lost, then the insurer and the dependent family members who are covered under the scheme have to immediately report to their branch office or dispensary.
  • In case an employee got transferred to other state or relocate for professional reasons, he/she has to get the form 105 signed by their current and existing employer to remain eligible for the benefits under ESI scheme in another location.

Solved Question on Employee State Insurance

Q)  Under the Employee’s State Insurance Act, 1948 who is an exempted employee?

(A) Under the act to pay the employee’s contribution, those employees who are not liable.

(B) Those employees who are minor.

(c) None of the above

Answer: (A)

Employee State Insurance Adjudication

  • For hearing grievances of the people who are not getting their claim dues because of various rules and regulations, Govt of India and state has to set up a court, which is known as EMPLOYEES INSURANCE COURT. it decides all the disputes arising under ESI ACT 1948.
  • According to section 74 of the ESI act, the state govt shall constitute an EMPLOYEE INSURANCE COURT for such local area as may be specified in the notification. The court shall consist of one or more judges as the govt may think right looking into the gravity of disputes.

Matters Related to Court Jurisdictions

  • Matters relating to deciding whether any person is an employee and he/she is liable to pay an employee’s contribution or not.
  • Claims for recovery of contributed payment from the employer.
  • Claims against principal employer under section 68.
  • Claims under section 70, where the recovery of the payment, if an employee received unlawfully.
  • The E.I court enjoys the powers of civil court as prescribed under civil procedure code 1908.
Share with friends
Customize your course in 30 seconds

Which class are you in?

Get ready for all-new Live Classes!
Now learn Live with India's best teachers. Join courses with the best schedule and enjoy fun and interactive classes.
Ashhar Firdausi
IIT Roorkee
Dr. Nazma Shaik
Gaurav Tiwari
Get Started
Customize your course in 30 seconds

Which class are you in?

No thanks.