DEFINITIONS:


 

 

  1. "Dependant" means any of the following relatives of a deceased insured person, namely:-

a.       A widow, a minor legitimate or adopted son, an unmarried legitimate and adopted

b.       A widowed mother

c.        If wholly dependent on the earnings of the insured person at the time of his death, a legitimate or adopted son or daughter who has attained the age of eighteen years and is infirm

d.       If wholly or in part dependent on the earnings of the insured person at the time of his death

                                                              i.      A parent other than a widowed mother

                                                             ii.      A minor illegitimate son, an unmarried illegitimate daughter or a daughter legitimate or adopted or illegitimate if married and a minor or if widowed and a minor

                                                           iii.      A minor brother or an unmarried sister or a widowed sister if a minor

                                                          iv.      A widowed daughter-in-law

                                                           v.      A minor child of a pre-deceased son

                                                          vi.      A minor child of a pre-deceased daughter where no parent of the child is alive, or

                                                        vii.      A paternal grand-parent if no parent of the insured person is alive

 

  1. "Permanent Partial Disablement" means such disablement of a permanent nature, as reduces the earning capacity of an employee in every employment which he was capable of undertaking at the time of the accident resulting in the disablement

 

Provided that every injury specified in Part II of the Second Schedule shall be deemed to result in permanent partial disablement

 

  1. "Permanent total Disablement" means such disablement of a permanent nature as incapacitates an employee for all work which he was capable of performing at the time of the accident resulting in such disablement

 

Provided that permanent total disablement shall be deemed to result from every injury specified in Part I of the Second Schedule or from any combination of injuries specified in

 

Part II thereof where the aggregate percentage of the loss of earning capacity, as specified in the said Part II against those injuries, amounts to one hundred per cent. Or more

 

 

  1. "Sickness" means a condition which requires medical treatment and attendance and necessitates abstention from work on medical grounds

 

  1. "Temporary Disablement" means a condition resulting from an employment injury which requires medical treatment and renders an employee, as a result of such injury, temporarily incapable of [doing the work which he was doing prior to or at the time of the injury]
  2. "Wages" means all remuneration paid or payable, in cash to an employee, if the terms of the contract of employment, express or implied, were fulfilled and includes


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APPLICABILITY OF THE ACT & SCHEME:

 Is extended in area-wise to factories using power and employing 10 or more persons and to non-power using manufacturing units and establish-ments employing 20 or more person upto Rs.15,000/- per month w.e.f. 01.04.10. It has also been extend-ed upon shops, hotels, restaurants, roads motor transport undertakings, equip-ment maintenance staff in the hospitals.

COVERAGE OF EMPLOYEES:

 Drawing wages Upto Rs.15,000/- per month Engaged either directly or thru’ contractor

RATE OF CONTRIBUTION OF THE WAGES:

 Employers’ 4.75%

 Employees’ 1.75%

MANNER AND TIME LIMIT FOR MAKING PAYMENT OF CONTRIBUTION:

 The total amount of contribution (employee’s share and employer’s share) is to be deposited with the authorized bank through a challan in the prescribed form in quadruplicate on ore before 21st of month following the calendar month in which the wages fall due.

BENEFITS TO THE EMPLOYEES UNDER THE ACT:

 Medical Benefit
 Sickness Benefit(SB)
 Maternity Benefit(MB)
 Disablement Benefit
 Dependants’ Benefit(DB)
 Funeral Expenses

 In addition, the scheme also provides some other need based benefits to insured workers.

WAGES FOR ESI CONTRIBUTIONS:

 Registers/files to be maintained by the employers

CONTRIBUTION PERIOD:

 If the person joined insurance employment for the first time, say on 5th January, his first contribution period will be from 5th January to 31st March and his corresponding first benefit will be from 5th October to 31st December.

TO BE DEEMED AS WAGES:

• Basic pay
• Dearness allowance
• House rent allowance
• City compensatory allowance
• Overtime wages (but not to be taken into account for determining the coverage of an employee)
• Payment for day of rest
• Production incentive
• Bonus other than statutory bonus
• Night shift allowance
• Heat, Gas & Dust allowance
• Payment for unsubstituted holidays
• Meal/food allowance
• Suspension allowance
• Lay off compensation
• Children education allowance (not being reimbursement for actual tuition fee)

NOT TO BE DEEMED AS WAGES:

• Contribution paid by kthe employer to any pension/provident fund or under ESI Act.
• Sum paid to defray special expenses entailed by the nature of employment – Daily allowance paid for the period spent on tour.
• Gratuity payable on discharge.
• Pay in lieu of notice of retrenchment compensation
• Benefits paid under the ESI Scheme.
• Encashment of leave
• Payment of Inam which does not form part of the terms of employment.
• Washing allowance for livery
• Conveyance Amount towards reimbursement for duty related journey

PENALTIES :

 Different punishment have been prescribed for different types of offences in terms of Section 85: (I) (six months imprisonment and fine Rs.5000), (ii) (one year imprisonment and fine), and 85-A: (five years imprisonment and not less to 2 years) and 85-C (2) of the ESI Act, which are self explanatory. Besides these provisions, action also can be taken under section 406 of the IPC in cases where an employer deducts contributions from the wages of his employees but does not pay the same to the corporation which amounts to criminal breach of trust.

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