The Employees State Insurance Act, 1948

The ESI Act passed in 1948 (amended in

1975,1984, and 1989) is an important measure of
social security and health insurance in this country.
It provides for certain cash and medical benefits to
industrial employees in case of sickness, maternity
and employment injury.
SCOPE:
The Act extends to the whole of India.
All power using factories where in 20 or more
persons are employed
 The Employees State Insurance Act, 1948

Shops, hotels and restaurants, cinemas and

theatres, road motor transport establishments
and Newspaper establishments.
Covers all employees – manual, clerical,
supervisory and technical getting upto Rs.10,000
per month
ADMINISTRATION
ESI Corporation – The Union Minister for Labour is
the chairman – members representing central and
state governments.
 The Employees State Insurance Act, 1948

FINANCE: The scheme is run by contributions by

employees and employers and grants from
Central and State Governments.
The Employee contributes 1.75 percent of wages
and employer contributes 4.75 percent of total
wage bill.
The State government share of expenditure on
medical care is 1/8 of total cost of medical care
The ESI Corporations share of expenditure on
medical care is 7/8 of total cost of medical care
 The Employees State Insurance Act, 1948

BENEFITS TO EMPLOYEES
Medical Benefit
Sickness Benefit
Maternity Benefit
Disablement Benefit
Dependant’s Benefit
Funeral expenses
Rehabilitation allowance
 The Employees State Insurance Act, 1948

1. Medical Benefit: consist of full medical care

including hospitalization, free of cost to the
insured persons in case of sickness,
employment injury and maternity
OP care, supply of drugs and dressings,
antenatal, natal and post natal care,
immunization services, family planning services,
emergency services, ambulance services, health
education and IP services.
 The Employees State Insurance Act, 1948

2. Sickness Benefit: The benefit is payable for a

maximum period of 91 days to in any continuous
period of 365 days, the daily rate being about 50%
of the average daily wages.
3. Maternity Benefit: Miscarriage – 6 weeks,
sickness arising out of confinement – 30 days.
4. Disablement Benefit: Temporary disablement –
70% of the wages is paid; Permanent disablement
– life pension
 The Employees State Insurance Act, 1948

5. Dependent’s Benefit: In case of death, the

dependants of an insured person are eligible for
periodical payment. Pension at the rate of 70% of
wages is payable shared by dependant in a fixed ratio
on monthly basis in accordance with the prescribed
share.
6. Funeral Expenses: Maximum of Rs.2500 is payable
7. Rehabilitation: On monthly payment of Rs.10, the
insured and his family members continue to get
medical treatment after permanent disablement or
retirement.