The Employee State Insurance, ESI act holds several sections. The section includes numerous medical benefits and insurance to employees working under factories registered under the ESI Corporation.
ESI act 1948is an exciting prospect for employee and legal perspective with the beginning of forming a social security program. The main objective of the act was to offer a security system for workers, especially in health-related unforeseen events. The Employee State Insurance Act, 1948 (ESI), offers financial backing and the proper support for working-class individuals during the time of medical distress.
Section 2(8) describes employment injury as a personal injury that a person suffered during employment, and such damage happens during an accident or occupational disease arising solely due to work.
The Scope and Application of the Act
The ESI contribution rate 2019-20 is 0.75% of the wages, and for the employer, it is 3.25% of the wages paid in respect of the employees during the wage period. Now, the act is applicable for situations like:
- Sickness
- Maternity Leave
- Disorders(mental or physical)
- Disability
- Death
It is a self-financed initiative, serving as a social security scheme for preventing the working class from any financial problems that arise or circumstances related to medical issues.
Benefits of the Act
The ESI act 1948 is the most crucial law offering social security and many benefits.
There are about six most valuable ESI benefits that injured employees can easily use. Section 46 of the act covers its benefits by describing each gift in detail.
Employers can avail themselves of the benefits during employment and use them during the service.
Medical Benefits
The day one becomes an employee, they can get employment benefits. These benefits also cover their family members, without having any limit in terms of expenses. ESI takes care of the treatment of employees, as mentioned in the rule. There are also annual payments made to retired workers or workers with permanent disabilities.
Maternity Benefits
These are for female insurable employees, gaining maternity benefits during pregnancy or confinement. The benefits can be taken for about three months. And employees can extend it for a month more based on their medical condition or expenses.
Sickness Benefits
Insurable employees can make some cash compensation when they get sick. This ESI contribution rate 2019-20 speaks about it, and it majorly is 70% wages when sickness occurs. There are a few criteria or points to consider, and only then employees can avail sickness benefits. One of which is an employee's contribution for 78 days out of six months.
Disability Benefits
In case, during employment, an employee suffers injuries and gets disabled. It is time for them to seek disablement benefits, which can be permanent or temporary. For temporary help, it is 90% of wages and lasts till the disablement continues.
While, in permanent disability, the compensation amount majorly depends upon the exact condition or extent of the injuries. Suppose the damages are too significant and need medical assistance for years.
Based on that, compensation will be generated too. Loss of earning capacity due to disability will be determined first, and the balance is derived accordingly.
Dependant Benefits
ESI benefits not only the employee who is working in the organisation. But it also gives importance to the dependent people on the employee. Especially during an employee's death, the people dependent on them face difficulties.
Employees can be the sole earners of the family, which makes it even hard for the people dependent on them to survive. The employee gets the compensation, which is usually 90% of the employee's wages.
Conclusion
Now that you know what the ESI act holds and its benefits to the employees. It can be easier for you to identify its support to the employee. You will also understand the type of compensation, percentage, and how long you are eligible to seek the benefits.
The act's introduction has given employees a new ray of hope and support during medical needs and health emergencies. With significant benefits, employees can also avail some miscellaneous benefits and make the most out of them.
