EMPLOYEES’ STATE

INSURANCE ACT 1948

 FIRST CONFERENCE OF LABOUR
MINISTERS 1940

SECOND CONFERENCE OF
LABOUR MINISTERS 1941

THIRD CONFERENCE OF LABOUR

HISTORY MINISTERS 1942

ADARKAR REPORT 1944

6TH LABOUR CONFERENCE 1944

  Object – to provide for certain benefits to employees in cases of
sickness, maternity and employment injury
 Application – to all factories, including those belonging to the
government
INTRODUCTI  Application to other establishment – by appropriate govt. –
ON after giving one month’s notice of its intention to do so
 Head office + branch offices – covered within the ambit of the
Act
 Transport Corp. of India v ESI Corp. 2000 scc (L & S) 121
  Seasonal factory
 Any factory which is engaged for a period not exceeding 7
months in a year

Manufacturing process

ACT NOT
APPLICABLE Incidental or

TO connected to

Manufacture of coffee,
Decortication of
Cotton ginning Cotton or jute pressing indigo, lac, rubber,
groundnuts
sugar, gur, tea
  Every establishment in which ten or more persons are
employed other than a seasonal factory
 Also be applicable to an establishment, which carries on such
APPLICABILI hazardous or life threatening occupation as notified by the
Central Government, in which even a single employee is
TY UNDER SS employed

CODE  An employer of a plantation, may opt the application in respect

of the plantation by giving willingness to the corporation,
where the benefits available to the employees are better than
what the employer is providing to them
  Where it appears to the Director General of the Corporation, whether
on an application made to him by the employer of an establishment
or otherwise, that the employer and majority of employees of that
establishment have agreed that the provisions of Chapter IV should
be made applicable to that establishment, the Director General of the
Corporation, may, by notification, apply the provisions of the said

APPLICABILI Chapter to that establishment on and from the date of such

agreement or from any subsequent date specified in the agreement.
TY OF CODE  Provided that where the employer of an establishment desires to

ON SS come out of such applicability, he may make an application to the

Director General of the Corporation and Director General of the
Corporation shall, if satisfied that there is an agreement between the
employer and majority of the employees to this effect, make the
provisions of that Chapter inapplicable to such establishment, in
such manner and subject to such conditions as may be prescribed by
the Central Government.
 IMMEDIATE
EMPLOYER
EMPLOYER
PRINCIPAL
EMPLOYER
 EMPLOYEE

EMPLOYEE WHOSE SERVICES

ARE
DIRECTLY EMPLOYED
TEMPORARILY
EMPLOYED BY P.E. THROUGH AN I.E.
LENT/LET ON HIRE
TO THE P.E
 AUTHORITIES

MEDICAL BENEFIT
STANDING COUNCIL
ESI CORPORATION
COMMITTEE
[REPEALED]

AUHTORITIE
S MEDICIAL BENEFIT
COMMITTEE:
perform such duties
and exercise such
powers
as may be prescribed
by the Central
Government
  All contributions paid + other money received on behalf of the
ESIC
 Other money –grants, donations, gift, CSR Fund
 Purpose of the fund:
 Payment of medical benefits
 Fees and allowances of members of authorities
 Payment of salaries, TA, gratuity, etc. of ESIC
EMPLOYEES’  Establishment and maintenance of hospitals, dispensaries, etc.
STATE  Payment of contribution to any State govt. towards cost of
INSURANCE medical treatment
FUND  Cost of audit, valuation of assets, etc. of ESIC
SECTION 26  Cost of setting up Employees’ Insurance Courts
 Payment of any sum under any contract
 Payment of sums under any decree/order/award
 Cost of proceedings
 Expenditure for improvement of health and welfare
 Other purposes authorised by the ESIC
  Employer contribution + Employee contribution = Contribution
paid to ESIF
 Employee contribution – payable for each wage period –
ordinarily due on last day
 Employer contribution – to be paid within 21 days of the last
day of the calendar month
 Failure to pay by PE – simple interest @ 12% p.a./ higher rate –
CONTRIBUTIO till the actual date of payment

NS  Factory/ establishment – permanently closed – employer

contribution to be paid on the last day of closure
 Section 40 – PE to pay Er.C + Ee.C. – for the first instance
 Direct employee – Ee.C. recovery by reduction from his/her
wages
 Section 41 – employee employed through IE – Er.C paid by PE
– entitled to recover the amount
  Monthly wage limit for coverage – Rs. 21,000/-
 Employer Contribution – 4.75%
 Employee Contribution – 1.75%
 Total – 6.5% towards ESIF

BENEFITS SICKNESS MATERNITY

DISABLEMEN
T

DEPENDENTS MEDICAL FUNERAL

  To any insured person
 Certified by a medical practitioner – Insurance Medical Officer
 Sickness –
 Requires medical treatment
 Requires someone should attend him
 Necessitates abstention from work

 Conditions + rate + period – prescribed by central govt.

SICKNESS  Extended sickness benefit

BENEFIT  Enhanced sickness benefit

 Conditions:
 Recipient shall remain under medical treatment at
dispensary/hospital/clinic provided under this Act
 Shall not do anything to prejudice his chances of recovery
 Shall not leave area of medical treatment without permission
 Allow himself to be examined by duly appointed medical officer
  26 weeks
 Extendable by further 1 month

MATERNITY CONFINEMENT MISCARRIAGE

BENEFIT

SICKNESS DEATH
 DISABLEMENT

EMPLOYMENT
INJURY OR
DISABLEME OCCUPATIONAL
NT BENEFIT DISEASE

TEMPORARY PERMANENT
  Saurashtra Salt Manufacturing Co. v Bai Valu Raja AIR 1958
SC 881
Workman is in the course of employment if he reaches the place
of work or a point or an area which comes within the theory of
‘ARISING OUT notional extension, outside of which the employer is not liable to
OF AND IN THE pay for any accident

COURSE OF  General Manager, BEST Undertaking v Agnes (1963) II LLJ

EMPLOYMENT’ 615
Notional extension of both entry and exit by time and space –
scope depends on circumstances of each given case
  Regional Director, ESI Corp. v Ranga Rao & ors (1982) 1
LLJ 29 Kar
‘Casual connection’ between accident and employment
 Regional Director, ESI Corp. v Batulbibi (1988) II LLJ 29

ARISING OUT  Regional Director, ESI Corp. v Francis De Costa 1994 SCC
OF AND IN THE (L&S) 195

COURSE OF ‘Causal connection’ – ‘Out of’ means injury by accident which

has its origin in employment – ‘In the course of’ is time
EMPLOYMENT’ conditioned.
1. There was an accident
2. Accident had causal connection with employment
3. Accident must have been suffered in course of employment
  Section 51B – Accidents happening while acting in breach of
regulations, etc
 Section 51C – Accidents happening while travelling in
PRESUMPTIO employer’s transport

NS  Section 51D – Accidents happening while meeting emergency

 Section 51E – Accidents happening while commuting to the
place of work and vice-versa (Doctrine of Notional Extension)
  In the form of pension payable to dependents of deceased
worker
DEPENDENT  No prescribed dependents – benefits payable to other
S’ BENEFIT dependents as prescribed by the Central Govt.
 Power of reviewing decision with the ESIC
  Full medical care
 Insured person/family member
MEDICAL  Also provided to retired and permanently disabled insured
BENEFIT person
  To eldest surviving member of the family
 Or person who actually incurs the expenditure
FUNERAL  Claim shall be made within 3 months of death of insured
BENEFITS person
  Benefits – not transferrable – not assignable
 Not entitled to commute for a lumpsum any disablement
benefit
 Benefits cannot be combined
GENERAL  All benefits except medical benefit required to be paid in cash

RULES  Failure of PE to pay any contribution – ESIC may pay it. ESIC
entitled to recover it from the PE
 Liability of owner to pay for excessive sickness benefit/extra
expenditure incurred by ESIC if there are insanitary
working/living conditions
  To save the employer from facing more than one claim for the
same accident

SECTION 53 A Trehan v Associated Electrical Agencies (1996) 4 SCC 255

The bar u/s 53 is absolute, clear and unequivocal.
  State govt. empowered to constitute EIC
 Limitation period – 3 years from date of cause of action
 Appeal from order of EIC only if there is a substantial question
of law
 Limitation period of appeal – 60 days
EMPLOYEES’
INSURANCE
COURTS JURISDICTION

QUESTION OR
CLAIMS
DISPUTES
SECTION 75(2)
SECTION 75(1)
  Central Government may, by notification, frame, amend, vary
or rescind scheme for other beneficiaries and the members of
their families for providing medical facility in any hospital
established by the Corporation in any area which is under-
NEW utilised on payment of user charges, and prescribe the terms
and conditions subject to which the scheme may be operated.
PROVISIONS [Section 44]
UNDER CODE  Central Government may, by notification, frame scheme for
ON SS unorganised workers, gig workers and platform workers and the
members of their families for providing benefits. [Section 45]