Employees’ State

Insurance Act,1948
Presented By
G.Madhuri
Employees’ State Insurance Act
 Commenced on 19th April 1948
 Apply to an establishment only when the

number of employees is 20 or more.

 To provide for certain benefits to employees

in case of sickness, maternity and

employment injury and to make provision for
certain other matters in relation thereto.
Employees’ State Insurance
Corporation
 With effect from 1st Oct 1948 for the
administration of the scheme of Employees’
State Insurance in accordance with the
provisions of this Act.
 All orders and decisions of corporation be

authenticated by the signature of the Director

General of Corporation
Constitution of Corporation
Corporation shall consist of the following members
 A chairman, vice-chairman to be appointed by the Central

Government
 One person each representing each of the state in which this

Act is in force to be appointed by state government

concerned
 One person to be appointed by central govt to represent

Union territories
 Ten persons representing employers to be appointed by

central govt
 Ten persons representing employees to be appointed by

central govt
 Two persons representing medical profession to be

appointed by central govt

 3 members of parliament : 2 members of Lok sabha

 1 member of Rajya sabha

Constitution of Standing Committee
Standing committee of corporation constituted from
its members, consisting of
 A chairman, three members of corporation

appointed by central govt

 Director-General of corporation, Ex officio
 3 members of corporation representing three state

govt
 8 members elected by corporation from members of

corporation
◦ - 3 members representing employers
◦ - 3 members representing employees
◦ - 1 member representing medical professional
◦ - 1 member elected by Parliament
Powers of Standing committee
 Administers affairs of corporation and
exercise any of the powers and perform any
of the functions of the corporation
 Committee shall submit for the consideration

and decision of the corporation

Medical Benefit Council
Constituted by central govt, consisting of
 Director General-Health Services, ex officio as Chairman

 Deputy Director General, Health services to be appointed by

central govt
 Medical commissioner of the corporation, ex officio
 1 member each representing each of the States appointed by

the state govt

 3 members representing employers to be appointed by the

central govt
 3 members representing employees to be appointed by the

central govt
 3 members representing medical profession to be appointed

by central govt from which there shall be atleast 1 woman

Duties of Medical Benefit Council
 Shall advice on matters relating to the
administration of medical benefit,
certification for purposes of grant of benefits
and other connected matters
 Have such powers and duties of investigation

in relation to complaints against medical

practitioners
 duties in connection with medical treatment

and attendance
Resignation of membership
 A member may resign his office by notice in
writing to the central govt
 His seat shall fall vacant on acceptance by

central govt
Cessation of membership
A member shall cease to be member of that body
 if he fails to attend 3 consecutive meetings
 In opinion of central govt, if any person cease to

represent employers, employees, medical

profession, corporation, standing committee or
medical benefit council
 If a member of corporation elected from

parliament cease to be member of parliament

Disqualification
 If a person declared to be of unsound mind
by a competent court
 If he is an undischarged insolvent
 If before or after the commencement of this

Act, he has been convicted of an offence

involving immoral behavior
Contribution
 All employees in factories or establishments to
which to this Act applies shall be insured in the
manner provided by this Act
 Contribution payable under this Act comprise of

employer’s contribution and employee’s

contribution which shall be paid to the corporation
 Contribution shall be paid at rates prescribed by

central govt
 Contribution payable shall fall due on the last day

of wage period
 If principal employer does not pay the
contribution till due, he shall be liable to
simple interest at rate of 12% per annum or at
higher rate till the date of its actual payment
as specified in regulations ( not exceeding
lending rate charged by scheduled bank)
 Any interest is recoverable as arrear of land

revenue
Principal Employer to pay
contribution in first instance
 Principal employer shall pay both employer’s contribution and
employee’s contribution in respect of every employee
 Employer can recover from employee’s contribution when not
withstanding anything contained in any other enactment
 Employer cannot deduct the employer’s contribution from wages
payable to employee by not withstanding any contract
 Any sum deducted by principal employer is entrusted to him by
employee
 Principal employer shall bear the expenses of forwarding the
contribution to corporation
Provisions as to payment of
contribution
 No employee’s contribution payable whose
average daily wages during a wage period is
below 6 rupees (w.e.f 1-2-1991)
 Contribution ( both employer’s and

employee’s ) payable by employer for each

wage period(week)
Method of payment of contribution
Corporation may make regulations regarding
 The manner and time of payment of

contributions
 Entry in or upon books or cards of particulars

of contribution paid and benefits distributed

in the case of insured person
 Replacement of books or cards which have

been lost or destroyed

 Every principal and immediate employer shall
furnish return and maintain registers relating
to persons employed as well as in respect of
his factory or establishment , to be submitted
to the corporation
 Corporation may appoint inspectors for the

purpose of this act .

 Inspectors will enquire into correctness of any

particulars stated
Benefits
Subject to the provisions of this act, insured person or dependant
shall be entitled to following benefits
 Sickness benefit : Periodical payments to any insured person in case
of sickness certified by duly appointed medical practitioner
 Maternity Benefit : Periodical payments to insured woman in case of
confinement, miscarriage or sickness arising out of pregnancy,
premature birth of child
 Disablement Benefit : Periodical payments to insured person
suffering from disablement as a result of an employment injury and
certified to be eligible by regulation authority

(conditions, rates & period as prescribed by central govt)

 Dependant’s Benefit : Periodical payments to dependants
of an insured person who dies as a result of employment
injury
 Funeral Benefit : Payment to the eldest surviving member of
the family of insured person who has died ( provided that
amount shall not exceed 100 rupees & claim to be within 3
months of death of the insured person)
 At the request of appropriate govt, corporation may extend
medical benefits to the family of insured person
Benefits not to be combined
An insured person shall not be entitled to
receive for the same period
 Both sickness and maternity benefit
 Both sickness benefit and disablement benefit

for temporary disablement

 Both maternity and disablement benefit for

temporary disablement
Constitution of Employees’ Insurance
court
 State govt shall constitute an Employees’ Insurance Court for such local

area

 Number of judges as per desired by state govt

 Any person who is or has been a judicial officer or is a legal practitioner

of five years’ standing shall be qualified to be a judge of the

Employees’ Insurance court

 State govt may appoint the same court for two or more local areas /

two or more courts for the same local area

 Where more than one court has been appointed for the same local area,

state govt may regulate the distribution of business between them

 Matters to be decided by Employees’
Insurance Court
If any question or dispute arises as to
 Any person is an employee within meaning of this Act

 Rate of wages or average daily wages of employee

 Rate of contribution payable by principal employer

 Right of any person to any benefit, as to amount and

duration
 Dispute between principal employer, corporation or

employee in respect of any contribution, benefit, dues

payable or recoverable under this Act
 Any application, appearance or act required to be made by
any person before Employees Insurance Court may be
made by Legal practitioner or Officer of registered trade
union or with the permission of the court by any other
person so authorised
 Employees Insurance Court may submit any question of
law for decision of High Court
 When the corporation has presented an appeal against an
order of Employees Insurance court and if so directed by
High Court shall pend the decision and withhold the
payment
 Period of limitation of appeal shall be 60 days
Penalties
 Punishment of false statement : If any person for the purpose of
increase in payment or benefit under this act / for purpose of
avoiding payment makes false statement shall be punishable
with imprisonment for a term which may extend to 6 months
and fine not exceeding 2000 Rs or with both.
 Punishment for failure to pay contribution : If any person
◦ Fails to pay contribution which under this act, he is liable to pay
◦ Deducts or attempts to deduct from the wages of an employee, the employer’s
contribution
◦ Reduces the wages or any privilege or benefit admissible to any employee
◦ Fails to submit any return required by the regulations
◦ Obstructs any inspector or official of corporation in the discharge of his duties
 ◦ Guilty of any contravention with any of requirements of
this Act or rules or regulations in respect of which no
special penalty is provided
 Enhanced punishment : If a person have been convicted
by a court of an offence punishable under this Act and
he commits the same offence, then for every subsequent
offence shall be punishable with imprisonment which
may extend to 2 yrs and fine of 5000 Rs.
Thank You