Social security is an important component of any social development agenda and
is as relevant as physical security in the evolving concept of human security.
Right to social security is a human security. Right to social security is human
rightand hence everyone has a right to a standard of living adequate for the
health and well being of himself and his family. India being a socialistic
democratic state, has a commitment of providing social and economic justice to
its citizens for the survival of democracy. Moreover, the creation of the
welfare state is to execute instrumentalities which are enshrined in the
directive principles of state policy serve as fundamental guides for the states
action towards social, economic and welfare programmes with a view to ameliorate
the conditions of labour. In pre independence period, a beginning was made to
provide social security measures with the passing of the workmens compensation
act, 1923. After independence, the government of india has enacted a number of
legislations to provide social security to industrial workers as productivity of labour is an essential condition for all round prosperity
of the country. But efficient production depends upon the sincere functioning of labour and
industry. If an industry exploits labour, it will affect the attainment of socio
economic objectives of the country itself.
When social justice is the primary
objective of the state as envisaged in our constitution, a reasonable return on labour is facilitated by social security laws which are as follows:
(i) The Employees Compensation Act,1923
(ii) The Employees State Insurance Act, 1948
(iii) The Employers Provident Funds and Miscellaneous provisions Act,
(iv) The Maternity Benefit Act, 1961
(v) The Payment of Bonus Act, 1965
(vi) The Payment of Gratuity Act, 1972
(vii) The Unorganised Workers Social Security Act,2008
Objectives of The Study
·The aim is to provide certain benefits to employees in case of
sickness, maternity, health and employment injury
·To secure the health of employees of factories and establishment
·The aim is to pay dependants benefits to dependants of each employees
·The aim is to absolve the liability under employer compensation Act,
1923 and the maternity enefit Act, 1961
Social security is a important component of any social development agenda which
is to provide protection against the economic and social distress, following
hypothesis have been formulated:
·ESI corporation to establish medical colleges, nursing colleges and
training institutes for para-medical staff and other employees to improve the
quality of services provided under ESI scheme
·ESI corporation to provide for certain benefits to empoyees in cases of sickenss, maternity, medical benefits, disablement benefits, dependents
Limitations of The Study
This study is intended to be limited to review the role of employees state
insurance corporation in securing the social security and to analyse the
existing social security measures under employees state insurance act, 1948.
The project work is doctrinal in nature on the basis of secondary sources.
Secondary data is one type of quantitative data that has already been collected
by someone else for a different purpose to our topic in discussion. It is always
in convenient to use data collected by someone else if exists it may be on a
much larger scale than we could hope to collect and could contribute to our
findings considerably. Secondary sources can be classified as:
·Paper based sources: books, journals, periodicals, abstracts, indexes,
directories, research reports, conference papers, market reports. Annual
reports, internal records of organizations, newspapers and magazines.
·Electronic sources: CD-ROMS, online databases, internet, videos and
broadcast. To appreciate the contribution made by the judiciary in promoting
social justice to the workers case laws are also analysed.
Scope of social security:
·The quest for social security and freedom from want and distress has
been the consistent urge of man through ages. This urge has assumed a several
forms, according to the needs of people and their level of social consciousness,
the advance of technology and the pace of economic development. These measures
have introduced an element of stability and protection in the midst of stress
and strains of life. It is a major aspect of public policy and the extent of its
prevalence is a measure of the progress made by a country towards the ideal of a
welfare state. There are nine componentsof the social security which
configure its scope. It envisages that the members of a community shall be
protected by a collective action against social risks causing undue hardships
and privation to individuals whose prime resources can seldom be adequate to
meet them. It covers through an appropriate organisations, certain risks are
such than an individual of small means cannot effectively provide for them by
his own ability or foresight alone or even in private combination with his
colleagues. The crux of the labour problem is the mutual conflict between the
employer and the employee over the question of adequacy of which the collective
bargaining and the industrial conflict are two main aspects.
·I.L.O and social security:
·The primary object of the international labour organisation is
promoting social justiceand improving the living and working conditions of
workers throughout the world. It emphasized the importance of comprehensive
social security measures in the preamble to its constitution, in which it
promised, “protection of employment injury and disease and workers against
stress, the protection of children, young person and women, provision for old
age and injury.
·Indian constitution and social security:
·The directive principles of our constitution reflect the concern of
the state to protect and promote the interests of weaker sections of our
population. The constitution of India was enshrined with the provisions in a way
to ensure social security to the human beings, in particular the workmen. The
constitution guarantees the promotion of welfare of the peopleand
eradication of the inequalitiesand it provides forthe state to direct its
policy towards securing livelihood, common hoodetc., By the constitution the
operation of a legal system shall be securedand effective
provisionswere made by the statefor the participation of workers in
undertakingsand for securing just and humane conditions of workand a
decent standard of life.
·The provision of the constitution was incorporated as a remedial
measure to deal with the inconsistency between laws made by the parliament and
legislatures of the state. The matters relating to the labour class are
enumerated in the concurrent list. If any provisions were made inconsistent
with that list, it will be void. The state legislatures has full power to
legislate regarding these subjects, subject to the provisions of article
254(2), that is, provided the provisions of state act do not conflict with
those of any contract act on the subject.The constitution also prohibits
traffickingand child labour.
Social security system in India:
·In ancient India there were economic groups living together in the
form of modern guilds, specialising in different branches of the economy. Dr.R.C.
Majumdar gives a list of about thirty such groups. The ancient jurists like
Vishnu, yagnavalkya, Brihaspati etc., had frame extensive laws regarding wages
and conditions of work and technical and vocational training, women and child labour, regulation
of industrial relations etc., these scripts bear testimony to
the fact that social structure in those days was so involved and codes so
designed as to provide security to the people in general and the workers in
particular. Kautilyahas mentioned a number of pension schemes in his
work, such as, educational pension, public poor relief.In the eighth
century, sukracharya makes special provisions for social security particularly
regarding sickness benefits, pensions and the old age benefits, family pensions
and maintenance allowance. He made it clear that when a servant was ill and
couldn’t work temporarily, the master should make no deduction from his
·In modern India, it was only during the present century that the
ancient rulers tried to look into the problem of social security that too was
mainly restricted to the factoryworkers and the like. The different sessions of
the international labour conference, the recognition of social security as a
responsibility of the state of different states in Europe and America and
advances made in these countries inspired the government of India to study the
problems. A number of study teams and committeeswere appointed and they
gave suggestions and unanimously agreed that the social security measures for the
workers in India were not adequate. However it was mainly after the independence
that India could take up the problem of social security at par with all advanced
countries of the world in a planned and co-ordinatedmanner. Free India
adopted the thoughts of the leader’s pt. Jawaharlal Nehru, sardarvallabhai
Establishment of Employees State Insurance Corporation
Pursuant to the power granted to the central government under section 3 of the
Act, the central government established the corporation on 1. 10.1948 by the
issue of notification in the official gazette. The corporation is a body
corporate having perpetual succession and a common seal and shall sue and
Constitution of The Corporation
The corporation consists of the members representing the governments at the
centre and the states, parliament, medical council, employers and employees. The
chairman and vice chairman of the corporation are nominated by the central
government. The director general of the corporation will be an ex officio
member. He is vested with the powers to manage the affairs of the corporation.
The other members of the corporation are chosen as follows:
(i) Not more than five members nominated by the central
(ii) One person nominated by the state government of each state in
which the act is in force;
(iii) One person nominated by the central government to represent the
(iv) Five persons representing the employers to be nominated by the
central government in consultation with the employers organization;
(v) Five persons representing the employees nominated by the
central government in consultation with the employees organization;
(vi) Two persons representing medical profession to e nominated by
the central government after consulting the organizations of medical practioners;
(vii) Three members of parliament of whom two shall be from the lok
sabha and one from the rajya sabha who are elected by the concerned houses.
The chairman, vice chairman, representatives of the central government, state
governments and union territories hold office during the pleasure of the
government concerned whereas the representatives of the employers medical
professions and parliament are to hold office even after the expiry of their
tenure until the nomination of their successors is notified.
Powers of The Employees State Insurance Corporation
The corporation is empowered to take steps for the benefit of the insured
persons. They are:
(i) To promote the measures for the improvement of health and
welfare of insured personnel;
(ii) To promote the measures for the rehabilitation and
re-employment of insured persons who are disabled or injured;
(iii) To incur expenses in respect of such measures from its fundup
to a limit prescribed by the central government.
Constitution of Standing Committee
The standing committee is constituted from among the members of the corporation
(i) A chairman nominated by the central government;
(ii) Three members of the corporation representing three state
governments as nominated by the central government;
(iii) Three members of the corporation nominated by the central
(iv) Eight members elected by the corporation from among its
(v) Three representing employers, three representing employees;
(vi) One representing medical profession;
(vii) One representing the parliament.
The chairman and representatives of the central and state governments hold
office during the pleasure of the central government. The other members of the
committee elected by the corporation hold office for two years from the date on
which election is notified.
Powers of The Standing Committee
The standing committee is constituted to administer the affairs of the
corporation. It is to function in accordance with the regulations framed by the
corporation. Its activities are controlled and supervised by the corporation
under the general provision ad matters as specified in the regulations for the
corporations consideration and decision.
Constitution of Medical Benefit Council
The medical benefit council set up by the central government to advise the
corporation on medical questions consists of the director general of health
serviced as its official chairman, deputy director general, medical commissioner
of the corporation, three members representing the employers nominated by the
central government, three members representing the medical profession nominated
by the central government and one representative from every state nominated by
the state government. The deputy director general holds office during the
pleasure of the central government. Similarly, representatives of the state
governments pleasure. The representatives of the employers, employees and
medical profession hold the office for four years from their nomination.
The Powers And Duties of Medical Benefit Council
The council is to advise the corporation and the standing committee regarding
the matters relating to the administration of medical benefits certification for
the purposes of the grant of benefit and other concerned matters. The council
enjoys such powers and performs such duties as may be prescribed in relation to
the administration of medical benefits, in connection with the medical treatment
and assistance as specified in the regulations
Central Governments Power To Supersede The Corporation And Standing Committee
The central government is empowered to supersede the corporation or standing
committee on the following grounds:
(i) If in the opinion of the central government, the corporation
or the standing committee persistently makes default in performing the duties
imposed on it by or under the act; or
(ii) If in the opinion of the central government, the corporation
or standing committee abuses the powers invested on it.
Such supersession is possible only in consultation with the corporation. The
central government shall give a reasonable opportunity to the corporation or the
standing committee to slow causes why it should not be superseded. When a
notification superseding the corporation, or standing committee is published by
the central government, all the members of these bodies shall be deemed to have
vacated their office from the date of publication of notification.
A person is disqualified to be chosen or to continue as a member of the
corporation, standing committee or medical benefit council if:
(a) He is declared to be of unsound mind by a competent court; or
(b) He is an undischarged insolvent; or
(c) He has directly or indirectly by means or by his partner any interest in a
subsisting contract with any work being done for the corporation except as a
medical practioner or a shareholder of a company; or
(d) He is convicted of an offence involving the moral turpitude whether before
or after this act came in to force.
Role of ESIC To Secure Social Security Through Benefits Available Under
Employees State Insurance Act, 1948
The various benefits under this clearly shows that this is for social security
legislation. It provides for six types of benefits to which the insured persons,
their dependants and certain other entitled persons.
The benefits are as follows:
An insured person is entitled to claim sickness benefit if he had paid
contribution for a period of not less than 13 weeks. For sickness occurring
during the first benefit period, he can claim sickness benefit if he had paid
for half the number of weeks of the contribution period ending in that
period( for e,g. more than 26 weeks in the one year)
A duly appointed medical practioner must certify that the insured person is
suffering from sickness. The daily rate of sickness benefit is calculated by a
ratio between his average daily wages and the contribution period.
But if sickness recurs within 15 days he can get the benefits. Sickness benefit
is not payable for more than 56 days in any two consecutive benefit periods. The
daily rate at which the benefit is payable to a person for the period of
sickness is the standard benefit rate corresponding to the daily average wages
during the corresponding contribution period.
The following conditions are to be complied with to entitle to sickness benefit:
(i) The person must be under medical treatment at the dispensary
hospital or institution provided under the act and must carry out the
instructions given by the medical officer.
(ii) While under treatment, he must not do anything which might
reduce his chances of recovery.
(iii) He should not leave the area without the permission of the
(iv) He must allow himself to be examined by any duly appointed
officer authorized by corporation.
Waiting Period In Sickness Benefit Under ESI Act, 1948
Sickness benefit is not payable for the first two days of a spell of sickness
except in case of a spell commencing within 15 days of closure of earlier spell
for which sickness benefit was last paid. This period of two days is called
An insured woman can get maternity benefit in cases of miscarriage, confinement,
sickness due to pregnancy and for premature birth of a child. The grounds of
eligibility of an insured woman to such payments must be certified by an
insurance medical officer as provided by the regulations under the act. However,
she should have paid weekly contributions for not less than 13 weeks. All the
other rules are similar to the rules in sickness benefit except that her
standard benefit will be doubled. The maternity benefit is not available for
maternity benefit is not available for more than six weeks during her
confinement. If the insured women dies leaving behind a child, the maternity
benefit is paid for the whole period. If the child also dies, the maternity
benefit is given to the woman workers nominee. If there is no nominee it is paid
to her legal representatives.
In the year 1921, ILO adopted a recommendation to the effect that each member
should take measures to ensure to woman wage-earner employed in agricultural
undertakings protection before and after child birth, similar to that provided
by the maternity protection convention, 1919.
The Employees state Insurance Scheme provides benefits against maternity,
insecurity of danger to life and death to life and death of the mother and child
arising out of miscarriage, confinement, still and premature birth and sickness
or disease due to pregnancy.
The justification for maternity benefit is two fold:
(1)To protect the health of mother and her child; and
(2)To alleviate part of the financial hardship caused by the birth of a
Statutory definition of maternity benefit:
periodical payments to an insured
woman in case of confinement or miscarriage or sickness arising out of
pregnancy, confinement, premature birth of a child or miscarriage, such women
being certified to be eligible for such payments by an authority specified in
this behalf by the regulations is hereinafter referred to as maternity
However, it may be noted that section 50 which contained all these provisions
has been substituted in 1989. Section 50 as it now stands provides that the
qualification of an insured woman to claim maternity benefit, the conditions
subject to which such benefit may begiven, the rates and period thereof shall be
such as may be prescribed by the central government.
Contingencies under which it is payable:As indicated above, the maternity
benefit is payable for (a) confinement, (b) miscarriage, (c) sickness arising
arising out of pregnancy confinement, premature birth of child, or miscarriage,
and (d) death.
the term confinement has been defined under section 2(3)
this act. According to it, confinement means labour resulting in the issue of a
living child, or labour after 26 weeks of pregnancy resulting in the issue of a
child whether alive or dead. This definition clearly indicates that labour
resulting in the issue of child is covered under confinement and labour
resulting in the issue of child- whether alive or dead is covered under
confinement only when such delivery takes place after 26 weeks of pregnancy.
according to section 2 (14-B) of ESI Act, miscarriage means the
expulsion of the contents of a pregnant uterus at any period prior to or during
the 26 th week of pregnancy but does not include any miscarriage, the causing of
which is punishable under the indian penal code. If the definitions of
miscarriage and confinement, are read together it becomes clear that if
expulsion of contents of the uterus takes place after 26 weeks, labour resulting
therein is known as confinement and if it occurs at any period prior to or
during the 26 th week of pregnancy it is known as miscarriage. An insured woman
who is qualified to claim maternity benefit in accordance with section 50 shall
in case of miscarriage be entitled to maternity benefit at the rates and for
such duration and subject to such conditions as may be specified by the central
government in this behalf. Really speaking the incidence
of miscarriage or abortion is higher for woman employed in industries than other
woman. Such occasions, besides causing economic loss and physical sufferings,
like that of normal confinement also upset the woman emotionally. In most of the
countries the contingency of maternity, besides pregnancy and confinement also
includes their probable consequences.
It would be worth mentioning that no woman can claim maternity benefit for
miscarriage causing of which is punishable under indian penal code because an
intentional miscarriage amounts to an offence punishable under the provisions of
the Indian penal code.
(c) Sickness arising out of pregnancy, confinement, premature birth of child
ESI scheme provides special protection to working women in
industrial establishments to which the provisions of this act apply for
maintenance of their health and newly-born child. The sickness arising out of
pregnancy, confinement, premature birth of child or miscarriage entitles to an
insured woman, in addition to maternity benefit payable to her under any
provisions of this Act, for all days on which she does not work for remuneration
to maternity benefit at the rates specified.
As a matter of fact, confinement as defined by the provisions of this act covers
contingencies of premature birth as well. If a child is born alive after full
period of pregnancy it is mature birth, and if the child is born after 26 weeks
of pregnancy it is premature birth-whether alive or dead and an insured woman is
entitled to claim maternity benefit in all such contingencies.
sometimes it so happens that an insured woman dies during her
delivery or during the period immediately following the date of her delivery for
which she is entitled to maternity benefit. It may happen that she may expire
leaving behind the surviving child and sometimes the unfortunate event of death
of both child and mother may occur. In all such contingencies an insured woman
is entitled to maternity benefit. The maternity benefit shall be paid for the
whole of that period then maternity benefit shall be paid for the days upto and
including the day of the death of the child. It means that if the mother dies on
the date of the delivery of the child and the child of child death. In such an
event maternity benefit shall be paid by the authorities concerned to the person
nominated by the insured woman in such a manner as may be specified in the
regulations and if there is no such such nominee such benefits are paid to her
In 1996 ESI (Central) Rules,1950 have been amended and now rule 56-A has been
inserted which provides that medical bonus to an insured woman and an insured
person in respect of his wife shall be paid sum of rs.2500/- per case as medical
bonus on account of confinement expenses: provided that the confinement occurs
at a place where necessary medical facilities under the ESI scheme are not
available. Provided further that confinement expenses shall be paid for two
Disqualifications for maternity benefit-An insured wpman may be disqualified
from receiving maternity benefit if (1) she fails without good cause to attend
for; or (2) to submit herself to medical examination when so required and such
disqualification shall be for such number of days as may be decided by the
authority authorized by the corporation in this behalf. However, she may refuse
to be examined by other than a female doctor or midwife.
An accident is an unfortunate occurrence resulting in cessation of work by
worker or a group of workers. More often than not, every accident also inflicts
on worker.The ESI Scheme provides for benefits to be paid to workers who
sustain employment injury as defined under the provisions of this act and
discussed earlier, are entitled to claim benefits. Periodical payment to an
insured person suffering from disablement as a result of an employment injury
sustained as an employee under this act, certified to be eligible for such
payments by an authority specified in this behalf by regulations, is referred to
as the disablement benefit.
Section 51 of ESI Act provides for disablement benefit in case of temporary and
permanent disablement. The disablement benefit shall be payable to an insured
person. The amended section 51 makes provisions for the disablement benefit in
(1) Where a person sustains temporary disablement for not less than three days
excluding the day of accident;
(2) Where a person sustains permanent disablement, whether total or partial.
The rate and the conditions of eligibility were governed by first schedule
before amendment made in 1989 but now the first schedule and some provisions of
old section 51 have been omitted. In place of these provisions now the central
government has been empowered to prescribe rates, periods and conditions subject
to which such benefit shall be payable.
Temporary Disablement Benefit,
is a condition caused by an employment injury
which necessitates medical attendance and renders the employee temporarily
incapable of doing the work which he was doing prior to the happening of the
accident, resulted in such an employment injury. Temporary disablement is paid
as leave salary, in case of an employment injury. The rate of leave salary is
90% of the average daily wage earned by the employee in the contribution period
corresponding to the benefit in which the accident happened. It is available
from the date of joining the insurable employment.
Permanent Disablement Benefit.
If there is any residual disability of permanent
nature due to employment injury, the insured person is examined by a medical
board to access the loss of earning capacity if any and its percentage. The
insured person is paid monthly periodical payments of permanent disablement for
life the date following the date of termination of temporary disablement at rate
The individualistic character of the family and the want of income yielding
property or family occupation causes economic insecurity for the members of a
workers family in case he dies a premature death. With human life there is an
asset value; the life of bread-winner is the biggest asset often the only asset
of the average family of the industrial workers. The death of its bread-winner
is the greatest calamity that can befall. The family at once sinks below the
poverty line and hence flows a train of evils. It is this that is largely
responsible for putting women in factories when they should have been in homes
and the children on the streets when they should have been at school.
Dependants benefit is a monthly pension payable to the eligible dependants of an
insured person who dies as a result of an employment injury or occupational
disease. The benefit cane be drawn in cash at the branch office or by money
order at the cost of the corporation or it can be credited every month the bank
account of beneficiary.
Review of Dependent's Benefit-Any decision awarding dependents benefit may be
reviewed at any time by the Corporation if it is satisfied by fresh evidence
that the decision given in non-disclosure or misrepresentation by the claimant
or other person of a material fact whether the or misrepresentation was not or
was fraudulent or that the decision is no longer in accordance with this due to
any other or due to the marriage, remarriage or cesser of infirmity of or
attainment the age of 25 years by, claimant subject to the provisions of ESl.
Act, the Corporation may, such direct that the dependents' benefit be continued,
increased, reduced or discontinued. The Corporation has been empowered to
review the decisions taken earlier for award of dependent's benefit in order to
provide relief in cases where decision has been taken in consequence of
non-disclosure of material fact or misrepresentation of material fact, secondly,
if the circumstances have changed due to birth or death or marriage or re
marriage or cesser of infirmity or attainment of prescribed age.
The first need of a sick or injured person is the alleviation of his physical
care. He must be cured of his ailment and restored to his suffering by per
medical normal health as rapidly as possible. Health is the most precious asset
individual and the only asset of the wage earner. No amount of cash payment can
adequately compensate for its loss. Ill-health is a permanent drain on the
meagre earnings of an individual; medical benefit, therefore, forms an integral
part of insurance benefit and more than the cash payment made to compensate the
loss of earnings. In fact is more important the pecuniary compensation which
aims at shielding the patient from the most material cases only subsists as a
factor side by side with medical assistance. The supplementary maintenance
of a healthy and vigorous labour supply is of capital importance not only for
the workers themselves, but also for communities which desire to develop their
productive the workers the capacity.
The medical care recommendation of ILO. provides that a medical care service
should meet the need of the individual for care by the members of the medical
and allied professions and for such other facilities as are provided at medical
(A) With a view to restoring the individual's health, preventing the further
development of diseases and alleviating suffering when he is afflicted by ill
health (curative care);
(B) With a view to protecting and improving his health (preventive care).
The Universal Declaration of Human Rights adopted in 1948 by United Nations
General Assembly proclaimed the right of everyone to medical care and so it
recognised medical care principles contained in ILO. recommendations The
provision for medical benefit has been made under ES.I Act, 194s in accordance
the above ILO. Medical recommendations. The responsibility to provide medical
benefit to the insured person is placed on the State Governments which have to
make arrangements for medical assistance etc. in consultation with the ESI.
Corporation and according to the standards laid down by it. The State
Governments are not to bear the le cost of medical care since the Corporation
reimburses each State for a part of the expenditure incurred in providing
medical care to the insured person under the act. Medical treatment for an
attendance on insured persons is hereinafter referred to as medical benefit.
Conditions for Medical Benefit-Following are the conditions for application
section 56 of the ES.I. Act:
(1) The claimant must be an insured person
(2) The claimant must be in such a condition which requires medical treatment
(3) The claimant must have paid his contribution for the period for which he
requires medical benefit then and then only he shall be entitled to medical
benefit during such a period or he is qualified to claim sickness benefit or he
is entitled to claim maternity benefit or he is in receipt of such disablement
benefit as does not disentitle him to medical benefit under the regulations.
(4) Medical benefit is given to the insured person and to his family, where it
has been extended to cover family of an insured person.
If an insured person or any member of his family requires medical treatment,
then medical benefit is given. It may be given either in the form of out patient
treatment or as inpatient in the hospital. The insured person is entitled to
medical benefit during any week in which contributions are payable. The state
government also arranges for medical treatment and provides rules for the kind
and scale of medical benefit. The corporation may establish and maintain
hospitals, dispensaries and surgical services with the approval of the state
government, for the benefit of insured persons and their families. The
corporation may undertake responsibility of providing medical benefit to insured
persons in consultation with the state government.
Besides benefits indicated earlier, ESI scheme provides for funeral expenses
also under certain circumstances. Section 46 (f) provides that payment to the
eldest surviving member of the family of an insured person who has died, towards
the expenditure on the funeral of the deceased insured person, or, where the
insured person did not have a family or was not living with his family at the
time of his death, to the person who actually incurred expenditure on the
funeral of the deceased insured person to be known as funeral expenses shall be
one thousand rupees.
For the application of section 46 (f), the following conditions must be
(1) The insured person must have died;
(2) The claimant must have incurred expenditure on the funeral of the deceased
(3) The claim for such payment shall be made within three months of the death
of the insured person.
However, the period may be extended by the corporation or any officer or
authority authorized by it in this behalf. The rules regarding funeral expenses
have been substituted with effect from 15-6-1991; which provide in respect of
issue of death certificate, submission of claims for funeral expenses, etc.,
Besides the above, other benefits being provided to the beneficiaries are
confinement expenses, funeral expenses, unemployment allowance and skill up
gradation training under RGSKY, vocational rehabilitation facilities for
permanently disabled persons, aids to insured persons and his family members
etc., and role in providing a complete social security to a major work force.
In Whirpool of India Ltd. v. ESI Corpn
. the Supreme Court again held that
the ESI is a social legislation to provide benefits to employees. Broadly this
The main source of which the action has been established under Section3 of the
Act. the Corporation contributions paid to the Corporation. The Employees' State
Insurance Fund is the others are as in Chapter v. in benefits to be provided to
insured persons and used but not defined in the Act particular, 46 The words and
expressions have meanings respectively defined in the Industrial Disputes Act,
1947, an assigned to them in Disputes Act, 1947. Undoubtedly as would be
interpretations may be possible would deserve such construction beneficial
working class but, at the same time, we cannot go by to the plain language of a
In damodar mangal ji and Co. v. Director, ESI
where appellant company was
engaged in mining industries. The company challenged the notification issued to
mining industry is beyond the scope of the notification Government means, in
respect of reason that the Government, or railway the establishment under the
control of Central government, and in administration a oil the all other cases,
the State Government. The appellant contended expression 'mine in Section of Act
to be with the expressions such as in respect of read so, would mean not only
the area where extraction of ores takes but also the other office and that the
enactment itself intends to make a distinction. It has so been made as is clear
from Section which defines expression factory", and mine which is subject to the
operation of the Mines Act, 1952 is excluded from the purview of the Act and
placed heavy reliance on the decision of the Court.
In Ballarpur Collieries C. v. State Industrial
Court on behalf of the
respondent. strong reliance is placed upon the decision in Serajuddin and Co. v.
Workmen , where the specific question what is the appropriate Government has
been considered and held that the expression mine used in Section 2 (a) (i) of
the Mines Act, 1952 to confine only to those cases where it really concerns a
mine where extraction of ores actually takes place as defined under Mines Act
and not other parts of establishment The supreme Court considered both the cases
and observed that in Ballarpur Collieries Co, case
the Court was concerned with
a notification which stated that the Act would come into force on 21-11-1974 "in
all industries except the following and then went on to name four industries,
the third one being "mines". The Supreme Court held that after the "following"
the word "industries" and thus read the notification in effect said the Act
would come into effect on the given date in all industries except the industries
above mentioned. Therefore, it was held that it is not only mines but the mining
industry itself that was exempted from the operation of the Act Application of
the Act The Law regarding extension of the Act was fully discussed by the C Mootham
of the Allahabad High Court.
In Anand Kumar v. Employees' State Insurance Corporation
is lt was observed
that the Central Government have been given wide discretion in extending the
provisions of the Act to any part of India. But the Act cannot be brought fully
into force until the Central Government is satisfied that the contributions
amount have been collected to enable the Corporation to fulfil its obligation
under this Act. This power been given to the Central Government to enforce
different provisions o this Act.
In paul abrao and sons v. Esi corpn
, and p.k.mohd pvt.ltd v. Esi corpn
supreme court discussing legality of notification extending operation of the act
to shops, hotels, restaurants and other specified establishments in specified
areas observed that the appellant is rendering service to cater to the needs of
exporters and importers and others who want to carry the goods further.
Therefore , it is shop carrying on a systematic economic or commercial activity.
This would be enough to bring in the appellant without specifically enumerating
the specific activities carried on by the appellant. Merely because other
establishments which are akin to shops are enumerated, it does not, , in any
manner, oblige the court to give a narrow meaning to the word shop nor does it
in any way dilute the meaning of shop.
In esi corpn. V. R.k. swamy and othersthe supreme court observed that
essentially, the advertising agency sells its expert services to a client to
launch an effective advertising campaign for his product. Without straining the
language, the premises of an advertising agency can, therefore, reasonably be
said to be a shop. Further , the act is a beneficient legislation and therefore
advertising agencies must be brought within its purview. A shipping company is
also a shop, regardless of the fact that the steamship company is not carrying
on stevedoring operations.
Inregional director, esi corpn v. Kerala state drugs and pharmaceuticals
ltdwhere certain employees were engaged through contractor. After the
construction of the plant, the contractor and his employees were no longer
connected with the respondents. Thereafter corporation made a demand for
contribution in respect of such employees towards insurance, the contributions
was refused. The supreme court observed that both the insurance court and high
court misconceived both the object of the act and the purpose of the insurance
scheme under it. The contribution which is levied on the employer in respect of
the employees engaged by him directly or through another agency is for the
benefit of all workmen in general who are covered by the act. The contribution
is irrespective of the fact whether the employees get or do not get the said
benefit. There is thus no quad pro quo between the persons insured and the
benefit available under the act. As regards the finding that the workmen were
unidentifiable, what is forgotten is that under the act, once an establishment
comes to be covered by the act, the employer becomes liable to pay the
contribution in respect of employees in his employment directly or indirectly.
The contribution which has become payable for the relevant period has to be paid
even if the employees concerned are no longer in employment or unidentifiable
on the relevant date.
ESIC has played a significant role in providing social security millions of
workers in the organized sector. It is only social security organization in the
country which provides insurance coverage for exi9gencies related to health,
maternity, disablement, death and employment. The corporation thus extends
complete social security cover to the workers and their family members. However,
the working of ESI is not up to the expected level of the insured person from
Findings of The Study:
·All ESI hospitals are not multidisciplinary hospitals and the
employees are not much satisfied with their services.
·Reimbursement of medical bill is a complex and time consuming process
and the employed are not getting the refund of full amount spent by them.
·Some ESI hospitals are facing the problem of lack of proper
diagonising facilities which forces the employees to depend private or clinics.
·Working time of ESI hospitals does not match with working time of
·In terms of services provided, private hospitals are better compared
to government hospitals.
Based on the findings of the study, following suggestions are offered to improve
the performance of ESI.
More number of ESI hospitals and dispensaries may be started to satisfy the
requirements of employees. The authorities of ESI hospitals should concentrate
more attention to provide better quality services to beneficiaries especially in
the areas of basic diagnostic services, nursing, laboratory and sanitary
services,. It is found that in certain areas of ESI dispensaries are functioning
only up to noon. It causes inconvenience to employees as they are forced to
avail leave from their workplace. Hence the working to the convenience of the
employees. Similarly, the procedures and formalities in connection with the
reimbursement should be simplifies to the extent possible.
Article 22 and 25 of universal declarartion of human rihts, 1948.
Articles 38, 39, 41, 42, 47 of the constitution of india.
Report of the national commission on labour(1969), p.162.
Medical care, old age benefit, unemployment benefit, family benefit, sickness
benefit, invalidity benefit, maternity benefit, survivors benefit and employment
Social security (minimum standards) convention (No:102)adopted by ILO in
Report of the national commission on labour, 1969.
Justice in terms of the distribution of wealth, opportunities, and privileges
within a society. “The way in which the human rights are manifested in the
everyday lives of people at every level of society”.
Article 38: the state shall strive to promote the welfare of the people by
securing and protecting as effectively as it may, a social order in which
justice, social, economic and political shall inform all the institutions of the
Article 38(2): the state shall in particular, strive to minimise the
inequalities in income facilities and opportunities, not only amongst
individuals but also amongst groups of people residing in different areas or
engaged in different avocations
Article 39: a) that the citizens, men and women equally, have the right to
an adequate means of livelihood.
b) That the ownership and control of the material resources of the community
also distributed as best to sub serve the common good.
c) That the operation of the economic system does not result in the
concentration of wealth and means of production in the common detriment.
d) That there is equal pay for equal work for both men and women.
e) That the health and strength of workers, men and women, and tender age of
children are not forced by economic necessity to enter avocations unsuited to
their age or strength.
f) That childhood and youth are protected against exploitation and against
moral and material abandonment.
Article 39-A: The operation of a legal system shall be secured by the state
which promotes justice, on a basis of equal opportunity and shall in particular,
provide free legal aid, by suitable legislation or schemes or in any other way,
to ensure that opportunities for securing justice are denied to any citizen by
reason of economic or other disabilities
Article 41: shall make effective provisions for securing the right to work,
to education and to public assistance in case of employment, old age, sickness
ad disablement and in other cases of undeserved want, within the limits of its
economic capacity and
Article 43-A: The state shall take steps, by suitable legislation or in any
other way, to secure the participation of workers in the management of
undertakings, establishments or other organisations engaged in any industry
Article 42: the state shall make provisions for securing just and humane
conditions of work and for maternity relief.
Article 43: The state shall endeavour to secure, by suitable legislation or
economic organization or in any other way to all workers, agricultural,
industrial or otherwise, work, a living wage, conditions of work ensuring a
decent standard of life and full enjoyment of leisure and social opportunities
and in particular, the state shall endeavour to promote cottage industries on an
individual or co-operative basis in rural areas
Article 254 of the constitution of India.
Entry 22:- trade unions; industrial and labour disputes; Entry 23:-social
security and social insurance; employment and unemployment; Entry 24:-welfare of
labour including conditions of work, provident funds employer’s liability,
workmen’s’ compensation, invalidity and old age pensions and maternity benefits.
Article 254(1): It was provided that, if any provision of law made by
parliament which is competent to enact or to any provision of an existing law
with respect to one of the matters enumerated in the concurrent list, then
subject to the provisions of clause (2), the law made by parliament, whether
passed before or after the law made by the legislature of such state, or, as the
case may be, the existing law, shall prevail and the law made by the legislature
of the state shall, to the extent of the repugnancy, be void
Article 254(2): Where the law made by the legislature of the state with
respect to one of the matters enumerated in the concurrent list contains any
provision repugnant to the provisions of an earlier law made by parliament or an
existing law with respect to that matter, then the law so made by the
legislature of the state shall, if it has been reserved for the consideration of
the president and has received his assent, prevail in that state.
Article 23: prohibition of traffic in human beings and forced labour.
Article 24: prohibition of employment of children in factories, mine or any
other hazardous employment.
Cooperative life in ancient India. Dr.V.R. Bhattacharya, Loc. Cit, pp. 1-2.
M.chandrasekar, loc. Cit, p.19.
He says the “state itself should provide support to poor, pregnant women, to
their new born offspring, to orphans, to the aged, the infirm, the affected and
N.C.Bandhopadhyaya, Kautilya, p.173.
M.chandrasekar Loc. Cit, chapter II.
Royal commission on labour in 1931, the Kanpur labour enquiry committee in
1938, the Bihar labour enquiry committee in 1940 and adarkar committee in 1943.
Dr.V.R. Bhattacharya, Loc. Cit. pp.13-19.
He says, “I think every employer should realise the terrible time labourer
has had for generations, how they were crushed”. Pt. Jawaharlal Nehru’s
speeches, Vol.3, pp.65-66.
He says, “like gandhiji I want to make the capitalists also understand which
way their true duty lies”.
Speeches of sardarvallabhai Patel: “for a United India”, pp. 94-95.
Section 3(2) of ESI Act,1948.
Section 4 of ESI Act, 1948.
Section 19 of ESI Act, 1948.
Section 8 of ESI Act, 1948.
Section 9 of ESI Act, 1948.
Section 18 of ESI Act, 1948.
Section 10 of ESI Act, 1948
Section 22 of ESI Act, 1948.
Section 21 of ESI Act, 1948.
Section 13 of ESI Act, 1948.
Section 29 of ESI Act, 1948.
Section 50 of ESI Act, 1948.
Section 46(b) of ESI Act, 1948.
ILO: minimum standards of social security, p.23.
Section 2 (14-B) of ESI Act, 1948.
ESI (Central) Rules,1950, proviso to rule 50(2).
ESI General Regulations, 1950, Regulation 93.
Section 51 of ESI Act, 1948.
Dr. p.c. Srivastava,loc.cit.p.238.
ILO Sickness insurance,p.72; dr.P.C. srivastava, loc.cit,p.252.
ILO Sickness insurance,p.72; dr.p.c. srivastava,loc.cit,p.252.
Int. labour conference, conventions and recommendations. 1909-1949,p.133.
I.L. Code,1951, vol.i, pp.653-655.
Section 46(e) of ESI Act, 1948.
Section 52 of ESI Act, 1948.
2000 SCC (l&S) 326.
2001 SCC (l & S) 582.
AIR 1996 SC 925 distinguished.
AIR 1996 SC 921 followed.
Air 1993 sc 252.
1994 1 llj 636 sc.
1995 scc (l&s) 1116