CONTRIBUTIONS UNDER

EMPLOYEE STATE INSURANCE ACT,

1948

ROHITH B R
5TH SEMESTER BBA.LLB
CONTENTS
• INTRODUCTION
• RULES
• METHOD OF PAYMENTS
• CONTRIBUTIONS
• DETERMINATION OF
COMPENSATION
• RATE OF CONTRIBUTIONS
• CONCLUSION
INTRODUCTION

• The E.S.I. Act (Employees State Insurance) passed in 1948

(amended in 1975, 1984, 1989 and 2010) 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. The act extends to the whole of India.
The E.S.I. Act of 1948 covered all power using factories other
than seasonal factories wherein 10 or more persons were
employed.
RULES

According to Section 2(4) of the Act, “contribution” means the

amount payable by employers to the ESI Corporation.

The Corporation further uses this amount for the benefit of eligible
employees. This amount also includes the employees’ contribution.
METHODS OF PAYMENTS

• The ESI Corporation has powers under the Act to make

provisions relating to the collection and payment of
contributions. Specifically, these provisions relate to the
manner and time of payment.
CONTRIBUTIONS

Who shall pay Period for which

Nature and Scope. contributions in the first Employees contributions
instance? are payable.

When contribution falls

Contributions Period. Rate of Contributions.
due?

Where to Deposit the How interest is

contributions? Recovered?
 Who shall bare the Recovery of Effect of not paying the
Expenses of remitting contributions from Contributions within
the contributors? immediate Employer. given limit.

Wages of a basis of
Duty of immediate Funding and Operation
Calculations of
Employer. Scheme.
Contributors.

Punishment for Failure

to pay Contribution.
DETERMINATION OF COMPENSATION

• Generally, the Central Government is responsible for

determining the specific amount of contribution
payable. Section 45-A, however, contains some exceptions
for this rule.
RATE OF CONTRIBUTIONS

• Ever since rules regarding contributions came into

existence, the central government has fixed contributions
a few times. The latest contribution amount since 1997 has
been 1.75% of wages for employees and 4.75% for
employers.
CONCLUSION
• Employees state insurance act 1948 is the legislative body of India which provides
enormous benefits to the employees. The central government and the ministry
of labour and employment together regulate the functioning of employees state
insurance act 1948. For a working-class employee in India, the ESI Act is an
essential utility that works in their favour, while also being beneficial for sectors
outside that of the working class.
• The Employees’ State Insurance Act, apart from medical benefits provided to
employees, also controls many more indirect aspects of efficiently managing the
Corporation established by the Act, be it its sales proceedings, account
management or separation of powers amongst its various officers.
REFERENCE

• INDUSTRIAL RELATIONS AND LABOUR LAWS

---> S C SRIVASTAVA

• https://www.esic.gov.in/contribution
• https://labour.gov.in/