ESIS Study Notes, Meaning , Act, History, Benefits Of Employees’ State, Insurance Corporation
ESIS – Meaning & Overview
- ESIS (Employees’ State Insurance Scheme) is a dynamic security scheme for socio-economic coverage of employees and their families.
- Launched on 24th February, 1952, in Kanpur.
- Administered by the autonomous apex corporate body called Employees’ State Insurance Corporation (ESIC).
ESI – History
Launched in 1952, the ESIC scheme has come a long way in its almost 70 years of existence. It became a historical move in the parliament as Industrialization in India was in its initial stages and only a few of the manufacturing industries needed human resources.
The legislation came into force at a time when India’s economic situation was not well. Thus, developing a multi-dimensional social security scheme to safeguard the interests of the working class with statutory provisions became a benchmark.
The ESI Act of 1948 applies to the following categories of establishments and factories:
- Non-seasonal factories using power and employing 10 or more workers
- Non-seasonal and non-power using factories and establishments employing 20 or more workers
Employees’ State Insurance (ESI) Act 1948
The ESI Act 1948 covers certain health-related events that the workers are usually exposed to. These include sickness, temporary or permanent disability,
Maternity and Occupational Diseases Coverage under ESI Act
The Employees’ State Insurance (ESI) Act encompasses various contingencies, including maternity and occupational diseases. The Act aims to provide social security to employees and their families during challenging times.
Key Provisions:
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Maternity: The ESI Act offers maternity benefits to insured women employees. These benefits include medical care, cash allowance, and paid leave during pregnancy and childbirth.
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Occupational Diseases: The Act also covers occupational diseases or death resulting from employment-related injuries. This provision ensures that employees receive compensation for any loss in wages or earning capacity due to work-related illnesses or accidents.
Objectives of the ESI Act:
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Protection from Distress: The ESI Act aims to mitigate the physical and financial distress faced by employees during contingencies such as maternity, occupational diseases, or employment-related injuries.
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Upholding Human Dignity: The Act seeks to uphold human dignity during crises by providing protection against deprivation, destitution, and social degradation.
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Empowerment: The ESI Act empowers society by retaining socially useful and productive manpower, ensuring that individuals can continue to contribute to the workforce.
ESI Objectives
- The ESI Act was formulated by ESIC to provide financial assistance during contingencies like maternity, illness, temporary or permanent disability, death due to injury at work, etc.
- The ESI Act also offers medical benefits for the labourers in India who work in the factories as well as in companies with at least 10 workers along with their families.
ESI Scheme Benefits
The ESI offers comprehensive medical coverage to workers during any kind of accident, sickness, impairment, or even death in the workplace, along with economic benefits during unemployment. The benefits of the ESI scheme are:
- Physical disability
- Maternity
- Sickness
- Dependant
- Medical
- Unemployment allowance
Besides the above, the scheme also provides the following need-based advantages to the insured workers:
- Vocational rehabilitation
- Physical rehabilitation
Atal Bimit Vyakti Kalyan Yojana
The ESI scheme proves to be highly beneficial for its subscribers during the ongoing Covid-19 pandemic. With millions of employment opportunities lost each month, the ESIC, under the important government scheme of Atal Bimit Vyakti Kalyan Yojana (ABVKY), offers unemployment allowance as cash compensation.
ABVKY is a welfare measure under the ESI scheme. Exceptionally, the compensation has been increased from 25% to 50% of monthly wages for three months.
The unemployment scheme benefit is capped at INR 31,500 per beneficiary. The insured must have been employed for 2 years before becoming unemployed and contributed for 78 days to be eligible for the scheme.
ESIC – Future Prospects
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The ESIC scheme now covers entities like shops, cinemas, restaurants, hotels, newspaper firms, insurance businesses, road-motor transport undertakings, airport and warehousing authorities, private medical institutions, and casual and contract employees of the Municipal Corporation/ Bodies under Section 1 (5) of the ESIC Act.
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The ESI scheme is widespread across the country, covering 566 districts in 34 states and union territories. It aims to reach over 700 districts in the coming year.
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The scheme currently covers more than 3.48 crore workers and a total of about 13.32 crores beneficiaries, with an insured women population of 51.2 lakh.
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Beneficiaries are entitled to facilities of hospitals, healthcare centers, and dispensaries empanelled under the Ayushman Bharat Scheme.
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