FREQUENTLY ASKED QUESTIONS

FREQUENTLY

ASKED QUESTIONS

ON

LABOUR LAWS

TABLE OF CONTENTS

S.No

Name of the Act

Page

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

The Payment of Gratuity Act, 1972

Employees Pension Scheme, 1995

The Employees Provident Fund and MP Act, 1952

The Payment of Bonus Act, 1965

The Maternity Benefit Act, 1961

The Contract Labour Regulation and Abolition Act, 1970

The Employees State Insurance Act, 1948

Industrial Dispute Act, 1947The Minimum Wages Act, 1948The Payment of Wages Act, 1936Employment of Exchanges Act, 1959Trade Union Act, 1926

3

4 8

9 17

18 19

20 21

22 23

24 35

36 - 38

39 - 41

42 - 46

47 - 48

49

THE PAYMENT OF GRATUITY ACT-1972

1. When is gratuity applicable to an employee? Ans: Gratuity is applicable to a permanent employee who completes 5 years of continuous service with the organisation.

2. Which form has to be filled for nomination of Gratuity?Ans: Form F has to be filled for Nomination of Gratuity.

3. who can be nominated for Gratuity?Ans: If employee is married than he/she can nominate spouse, if not then dependant parents.

4. if an employee does not have dependant parents or is not married, can he/she nominate his/her brother or sister?Ans: Yes he/she can do that, but sooner or later he/she acquires a family than the employee has to communicate the same to the HR department to make the necessary changes in Nomination.

5. When is an employee eligible for getting gratuity?Ans: Employee has to complete continuous service of 5 years, but after the ruling of Madras High Court if there are 240 working days in the 5th year even then an employee is eligible for the gratuity.

6. What if an employee completes 4 years & 6 months of service, is he eligible for Gratuity?Ans: No, but where an employee has completed 4 years & 240 days of continuous service in the 5th year he is eligible for the Gratuity.

7. What if an employee before completing 5 years of continues service expires, is he eligible for Gratuity?Ans: In case the employee expires before completing 5 years and gratuity could be paid to the nominee of the deceased employee provided the employee has completed a year of service.

8. What is the maximum Gratuity payable to an employee?Ans: Maximum Gratuity payable to an employee is Three Lakhs Fifty Thousand only.

9. Is retrenched employee entitled to gratuity?Ans: Yes, a retrenched employee is also entitled to gratuity.

Back to Contents PageEMPLOYEE PENSION SCHEME, 1995.

1) Who will be covered by the Pension Scheme?Every member of the ceased Family Pension Scheme 1971 and anyone who joins any covered establishment on or after 16-11-95 is compulsorily to join this scheme, provided his/her salary/wage is less than Rs. 6500/- per month at the date of appointment.

2) What is a covered establishment?

Covered establishment is an establishment belonging to the class of industries / other establishments, which has been listed in the schedule appended to the Employees' Provident Fund and Miscellaneous Provisions Act 1952 and where 20 or more persons are employed.

3) If employee was a Family Pension Scheme member. He/She has left on 13-12-93 and he/she is 54 years old. He/She has taken his withdrawal benefit. Can he/she join the new scheme?

Yes, by refunding withdrawal benefit together with interest. Thereafter, he/she will be entitled to receive pension from age 58, if he/she completes at least 10 years of contributory service by then.

4) If employee is a Family Pension Scheme Member and he/she has retired after 58 years of age on 15-01-94. Can he/she join the new scheme?

Yes, anyone who has retired by reaching age 58 between 01-04-93 and 15-11-95 may join the scheme by returning the withdrawal benefit along with interest. He will be paid pension with immediate effect, from date of exit provided he has rendered 10 years of contributory service.

5) If employee is not a Family Pension Scheme member and he/she is 56 years of age, Can he/she join Family Pension?

Yes, by diverting from his/her Provident Fund balance, Family Pension Scheme contribution from date of his/her joining or 01-03-71, whichever is later.

6) Whether the Family Pension Scheme member who has attended the age of 58 years before 01- 04-93 and has left employment after 01-04-93 will be admitted to the scheme as member of Family Pension Scheme, 1971?

Yes, he will be deemed to have retired after 01-04-93. On repayment of that withdrawal benefit which was paid, Pension will be paid from same date, provided he has rendered 10 years of contributory service.

7) In case Family Pension member has attained the age of 58 years between 01-04-93 and 16-11- 95 then in that case whether arrears of monthly Member Pension become payable for the period earlier than 16-11-95 i.e. from the date of his/her attaining the age of 58 years which is prior to 16-11-95?

No, he/she will be deemed to have retired from 16-11-95 and pension paid accordingly.

8) Is employee the only beneficiary of Fund?

Benefit will be paid to him/her and in his/her absence to his/her family.

9) What is meant by Family?

Family means employees' spouse and children below 25 years of age.

10) Suppose an employee does not have a Family and he/she dies before receiving benefit. Does his/her pension get lost?

No, if he/she does not have a family, benefits will be paid to his/her nominee, who will receive the benefit in his/her absence.

11) Suppose member has not nominated anyone.

The pension / ROC will be paid to the dependent parents.

12) Can member change his/her nomination?

He/She can change his/her nomination whenever he/she decides within the framework of rules for such nomination. In other words if he/she has a family, nomination should be in favour of a member(s) of the family. If he/she has no family he/she can nominate anyone he/she wishes.

13) How many years service is required to be eligible to receive member pension? Minimum 10 years eligible service will entitle for member pension.

14) Employee is a member of Employees' Pension Scheme. He/She has left employment at 48 yrs. of age and 8 yrs. of service. When shall he/she receive his/her pension?

He/She can take either withdrawal benefit or can take scheme certificate so that the 8 years service can be added to any future service that he / she may put in, in any other covered establishment. By virtue of being a holder of a scheme certificate, if the member dies before 58 years widow / widower and children shall be entitled for pension.

15) What is past service pension?

This pension is for the period of membership of the Employees' Family Pension Scheme, 1971.

16) When does an employee become eligible to become a member of Employees' Provident Fund Scheme, 1952 and Employees' Deposit Linked Insurance Scheme, 1976?

An employee becomes a member of Employees Provident Fund (Employees' Provident Fund) Scheme, 1952 / Employees Deposit Linked Insurance (Employees' Deposit Linked Insurance) Scheme, 1976 immediately on joining an establishment covered under the Employees Provident Funds & Miscellaneous Provision Act, 1952.

17) What is nomination?Every member has to give the details of himself & details of the nominee for Employees' Provident Fund & Employees' Deposit Linked Insurance Schemes and details of family for Employees Pension Scheme, 1995 in form no. 2. A member if, is having a family can nominate any one or more persons to receive the Provident Fund on his death. In case of him having no family he can nominate any other person.

Family for the purpose of Employee Provident Fund Scheme'52 means wife/husband, children, whether married or unmarried, including adopted children, if adoption is recognized and dependant parents of member.

Employees Deposit Linked Insurance Scheme benefit will be paid to the nominee under Employees Provident Fund Scheme, 1952.

For the purpose of Employees Pension Scheme, 1995 the member has to furnish the details, such as name, relationship & age of all the family members in the form no. 2. Family for the purpose of Employees Pension Scheme, 1995 means wife/husband & children. Whenever member wants to make a change in the nomination already made for Provident Fund, or to update the details of family for Employees Pension Scheme, 1995, he has to send a revised form no. 2. The form no.2 is routed through the employer.

18) What are the periodical returns to be sent by an employer to the Provident Fund Office?The employer of an un-exempted establishment has to forward the following returns. These returns will include details required under the three schemes namely, Employees Provident Fund Scheme, 1952, Employee Deposit Linked Insurance Scheme, 1976 and Employee Pension Scheme, 1995.

a) Form-9(Revised):

The details of employees enrolled as members of Employees' Provident FundS'52, Employees' Deposit Linked Insurance'76 & Employees' Pension Scheme'95 on coverage of the establishment- This is to be submitted immediately after coverage, within 15 days of coverage.

b) Form-12A:

The details of the contributions recovered form the members & paid along with details of employers' contribution & administrative charges- This is to be submitted monthly by 25th of following month.

c) Form-5:

The details of the employees enrolled newly to the Provident Fund- To be submitted along with Form-12A every month within 15 days of the following month.

d) Form-10:

The details of the employees leaving service during the month- To be submitted along with form-12A.

e) Challans:

The triplicate copy of challans in token of having remitted the Provident Fund dues in the bank- to be submitted along with form-12A every month.

f) Form-2 (Revised):

Nomination form- To be submitted along with form-5/9.

g) Form-3A:

The details of wages & contributions in respect of each member, to be prepared financial year wise- To be submitted to the Provident Fund office by 30th of April every year.

h) Form-6A:

Yearly consolidated statement of contributions- To be forwarded yearly along with form-3A. It should be ensured that all the form-3A are entered in form-6A, irrespective of whether the form-3A was forwarded for the broken period and the total dues as per the form-12A for the whole year agrees with the total of form-6A within 30th April.

i) Form-5A:Return of ownership of the establishment- To be forwarded immediately after coverage & whenever there is a change in the ownership, it has to be intimated with in 15 days of change.

j) Specimen signature:

Specimen signature of the officer/officers who are authorized to sign the returns/documents relating to Provident Fund forwarded immediately after coverage & whenever there is a change inauthorized officer.

19) What is the procedure to be followed by the member if the employer is not attesting his claim forms?It is the duty of the employer under the Act & Scheme to help Employees' Provident Fund organisation to settle the Provident Fund dues of his employees. He has to complete the prescribed application within 5 days of receipt [para72 (5)] forms & hand over it to the member when he leaves the service. When a member finds difficult to get the form attested by the employer, he can get the attestation of any of the following officer & send to the Provident Fund office.

Manager of a bank.

By any gazetted officer.

Member of the Central Board of Trustees. / Committee/ Regional Committee (Employees Provident Fund Organization).

Magistrate/ Post/ Sub Post Master/ President of Village Panchayat/ Notary Public.

20) What is the mode of payment of Provident Fund and Employees' Deposit Linked Insurance dues?Provident Fund & Employees' Deposit Linked Insurance dues is paid by money order/ by deposit in payees' bank a/c/ through employer/ by depositing the cheque in payees' name or part of amount in annuity scheme in any nationalized bank. Payment by money order is allowed where the amount is not more than Rs. 2000/-.

21) What are the modalities to be followed for payment through cheque?The member has to open an account in the nationalized bank, scheduled bank, urban bank or post office savings bank. He has to furnish the details of bank a/c no. with the full address of the bank in application form. An advance stamped receipt has also to be annexed in the form.For receipt of pension member/claimant has to open an account only in State Bank of India or Punjab National Bank.

22) In case of returning of cheque what is the procedure to be followed?Generally the cheques are returned by the bankers when the a/c number is furnished incorrect or a/c has been closed. On receipt of the cheque from the bankers the Provident Fund office will write to the member & employer about the fact & request them to intimate the bank, a/c number & detailed address. In case, the member comes to know about returning of the cheque before this, he can write to the Provident Fund office through his former employer regarding his present address & bank a/c number.

23) What is the time taken for disposal of the application in the Provident Fund office?The claims received complete in all respects are disposed off within a maximum period of 30 days from the date of receipt of claims in the office. In case the member is not hearing anything about his application within 30 days, he can approach the Public Relation Officer.

24) What is the voluntary rate of Provident Fund contribution by the member?

As per the Act, the member has to contribute at the rate of 10% or 12% of his basic pay, D.A. & retaining allowance if any. In case the member wants to contribute more than this, voluntarily he can do so at any rate he desires. i.e. upto 100% of basic and D.A. But the employer is not bound to contribute at the enhanced rate.

Instructions for a member while sending application to Employees' Provident Fund.

Use the appropriate form for claiming Provident Fund Pension, withdrawal benefit/scheme certificate, Employees' Deposit Linked Insurance benefit, etc. as given below: -

Form-19: To claim final settlement of Provident Fund by a member.

Form-20: To claim Provident Fund by nominee/legal heir on death of the member.

Form-10-D: To claim pension. (In duplicate: If within state, In triplicate: If outside state.)

Form-10-C: To claim withdrawal benefit/scheme certificate under Employees' Pension Scheme '95.

Form-5IF: To claim assurance benefit under Employees' Deposit Linked Insurance '76 by nominee/legal heir of a member.

Form-31: To claim temporary withdrawal/advance under Employees' Provident Fund scheme'52.

Form-13: To effect transfer of Provident Fund/Pension from one A/C to another.

Ensure that all columns of the application are filled completely.

Information in the application form relating to name, a/c no. should agree with the details available with Employees' Provident Fund Organization; which were furnished by the employer at the time of enrolling to Provident Fund.

Application should be signed by the member/claimant.

It should be attested by the former employer. In case attestation by the former employer is not possible,

it should be got attested by any other authorized official specified with application form.

Application for final settlement can be sent by a member on completion of 2 months from the date of leaving service, if the reason for leaving service is other than superannuation, medical ground, retrenchment and V.R.S./ Female members getting married etc.

Desired mode of payment can be given legibly, if the amount involved is more than Rs. 2000/-. The amount will be sent by deposit in payees' bank a/c. To facilitate this, Bank a/c no., name and address of the bank should be furnished. An advance stamped receipt should also accompany this application.

Application may be supported by the return Form-10, showing the details of leaving service and details of contribution for the year in Form-3A, if not sent earlier by the employer.

Specific additional requirements:A) Death cases: Nominee/legal heir should apply in Form-20 /Form-10-D /Form-5IF.

If the member has not executed any nomination, application should be supported by certificate of family members issued by employer/revenue official/sworn in an affidavit by the family/ member/legal certificate from a court of law.

Death certificate of the member.

Certificate of the employer stating whether the death was while in service of the member or not.

B) Pension cases: Joint photograph of member/spouse or the claimant should accompany the application.

Option for return of capital/commutation should be specified clearly.

Details of non-contributory period during the service, wages/salary for last 12 months should also accompany, if not already sent.

Details of the branch of the specified bank may be given legibly.

Date of birth certificates of children

In case of death away from service, an undertaking by the claimant to the effect that the member was not working / had not worked in any other covered establishment after exit from the establishment on the basis of which pension is being claimed.

Back to Contents Page THE EMPLOYEE PROVIDENT FUND & MP ACT, 1952

Q1) What is the Contribution for Provident Fund both by the Employer & Employee?

Ans: The Employee contributes 12% of his /her Basic Salary & the same amount is contributed by the Employer.

Q2) Is it Compulsory for the all the employees to contribute to the Provident Fund?

Ans: Employees drawing basic salary upto Rs 6500/- have to compulsory contribute to the Provident fund and employees drawing above Rs 6501/- have an option to become member of the Provident Fund.

Q3) Is it beneficial for employees who draw salary above Rs 6501/- to become member of Provident Fund?

Ans: Yes because provident fund contribution by the employer & employee is not a taxable income for Income Tax purpose.

Q4) What if an employee while joining establishment has a basic salary of Rs 4200 and after some period of time his basic salary increases above Rs 6501/-, does he have an option to terminate his member ship form the Provident fund act?

Ans: Employee who while joining the organisation has a basic salary above Rs 6501/- have an option to either become or avoid becoming member of Provident fund but employees whose basic salary while joining the organization is less then Rs 6501/- but after some period of time their basic increases above Rs 6501/- have to compulsorily continue to be member of provident Fund.

Q5) What is the contribution percentage to the Provident fund and Pension Scheme?

Ans: Employees contribution of 12% of basic salary is totally deposited in provident fund account whereas out of Employers contribution of 12%, 3.67% is contributed to Provident fund and 8.33% is deposited in Pension scheme.

Q6) Which form has to be filled while becoming member of provident fund?

Ans: Nomination Form No 2 has to be filled to become a member of the Provident fund, form is available with HR department.

Q7) Which form has to be filled while transferring provident fund deposit?

Ans: You just have to fill form no 13 to transfer your P.F amount.

Q8) What is the provision of the scheme in the matter of nomination by a member? Ans: Each member has to make a nomination to receive the amount standing to his credit in the fund in the event of his death. If he has a family, he has to nominate one or more person belonging to his family and none other. If he has no family he can nominate any person or persons of his choice but if he subsequently acquires family, such nomination becomes invalid and he will have to make a fresh nomination of one or more persons belonging to his family. You cannot make your brother your nominee as per the Acts.

Q9) When is an employee eligible to enjoy pension scheme?

Ans: For an employee to become eligible for Pension fund, he has to complete membership of the Fund for 10 Years.

Q10) What does it mean by continuous service of ten years?

Ans : When we say continuous service of 10 years in Employee Pension Fund, we mean to say that during services, for e.g., an employee who has worked with X company for say 3 years, then he resigned from that organisation and joined Y company, wherein he worked for 2 years, then resigned from there to join establishment for 5 years but during these 10 years of service he has not withdrawn but transferred his Employee pension fund, then we say continuous service of ten years.

Q11) When can an employee avail the benefit of Employee pension fund scheme which he has contributed during his ten years of continues service?

Ans: An employee can avail the benefit after completion of 58 years of service.

Q12) What happens to the provident fund & Employee Pension fund if an employee who wants to resign from the service before completion of ten years of continues service?

Ans: Employee can withdraw the PF accumulations by filling Forms 19 & 10 C, which is available with the HR department.

Q13) What is this 19 & 10C form?

Ans: Form No 19 is for Provident fund withdrawal & Form No. 10 C is for Pension scheme withdrawal.

Q14) Do we get any interest on the amount, which is deposited, in the Provident Fund account?

Ans: Compound interest as declared by the Govt. is given for every year of service.

Q15) What is the accounting year for Provident fund account?

Ans: Accounting year is from March to February.

Q16) What are the benefits provided under Employee Provident Fund Scheme?

Ans: Two kinds of benefits are provided under the scheme-a) Withdrawal benefitb) Benefit of non -Refundable advances

Q18) What is the purpose of the Employee's Pension Scheme?

Ans: The purpose of the scheme is to provide for1) Superannuation pension.2) Retiring Pension.3) Permanent Total disablement PensionSuperannuation Pension: Member who has rendered eligible service of 20 years and retires on attaining the age of 58 years.Retirement Pension: member who has rendered eligible service of 20 years and retires or otherwise ceases to be in employment before attaining the age of 58 years.Short service Pension: Member has to render eligible service of 10 years and more but less than 20 years.

Q19) How much time does it takes to receive P.F & pension money if an employee resigns from the Service?

Ans: Normally the procedure for receiving P.F & Pension money is, the employee has to fill 19 & 10 c Form and submit the same to PF Desk, which is then submitted to the P.F office after two months, this two months is nothing but a waiting period as the rules are that an employee should not be in employment for two months after resigning if he has to withdraw his P.F amount. After completion of two months the form is submitted to the regional provident fund Commissioner office after which the employee receives his amount along with interest within a period of 90 days.

Q20) Do we receive money through postal order?

Ans: Previously there was a procedure wherein member use to get P.F through Postal order but now while submitting the P.F form withdrawal form you have to mention your saving Bank account No. & the complete address of the Bank where you hold the account.

Q21) How would I know the amount of accumulations in my PF account?

Ans: PF office sends an annual statement through the employer, which gives details about the PF accumulations. The statement contains details like, Opening balance, amount contributed during the year, withdrawal during the year, interest earned and the closing balance in the PF account. This statement is sent by the PF department on completion of the financial year.

Q22) which establishments are covered by the Act?

Ans: Any establishment, which employs 20 or more employees. Except apprentice and casual laborers, every Employee including contract labour who is in receipt of Basic+ DA salary up to Rs. 6500 p.m. is covered by the Act.

Q23) In case after registering the establishment at any point in time, the number of employees working in it becomes less than 20 then will the Act apply?

Ans: Any establishment which has been covered under the Act once shall continue to be governed by the Act even if the number of persons employed therein at any time falls below 20.

Q24) Is the Act applicable to a factory, which is closed down but is employing a few employees to look after the assets of the establishment?

Ans: No, Where the establishment is closed down and only four security men are employed for keeping a watch over the assets and properties of the establishments, the Act would not be applicable.

Q25) Is a trainee an employee under the Act?

Ans: Yes, a trainee would be considered as an employee as per the Act but in case the trainee is an apprentice under the Apprentice's Act then he/ she will not be considered as an employee under this Act.

Q26) Is it possible to appeal the orders of the Central Government or the Central Provident Fund Commissioner?

Ans: Yes, there is a body called as Provident Fund Appellate Tribunal where an employer can appeal.

Q27) Who is the authority to decide regarding the disputes if any?

Ans: In case there is a dispute regarding the applicability of the Act or the quantum of money to be deducted etc. the authority to decide are the i) Central Provident Fund Commissioner,ii) any Additional Provident Fund Commissioner, iii) any Additional Central Provident Fund Commissioner iv) any Deputy Provident Fund Commissioner v) any Regional Provident Fund Commissioner orvi) any Assistant Provident Fund Commissioner

Q28) What in case there are workers involved as Contract labour?

Ans: It is the responsibility of the Contractor to deduct the PF and submit a statement to the Principal Employer in the prescribed format by 7th of every month. The Company becomes the Principal Employer would be responsible for the PF deduction of the workers employed on contract basis.

Q29) Are the persons employed by or through a contractor covered under the Scheme?

Ans: Persons employed by or through a contractor are included in the definition of " employee " under the Employee's Provident Finds Act, 1952, and as such, they are covered under the Scheme.

Q30) In case the Contractor fails to deduct and submit the PF amount from the contract workers then what is to be done?

Ans: The Company being the Principal employer is responsible for the PF to be deducted from the Contract workers as well. In case the Contractors fails to deduct and submit the PF dues then the Company has to pay the amount and can later on recover the amount from the Contractor.

Q31) Could the employer be punished in case the remittance of contribution by him is delayed in a Bank or post office?

Ans: Employer cannot be punished or penalized in case there is a delay in the remittance of the contribution on account of delay in Bank or post office.

Q32) What happens in case there is a salary revision and a raise in the basic salary of the employee and arrears need to be paid, Do we need to deduct PF from the arrears as well?

Ans: Arrears are considered to be emoluments earned by the employee and PF is to be deducted from such arrears.

Q33) Is it possible for an employee to contribute at a higher rate of interest than 12 %?

Ans: Yes, if an employee desires to contribute an amount at a higher rate of interest than 12 % of basic salary then they can do so but it does not become obligatory for the employer to pay anything above than 12 %. This is called voluntary contribution and a Joint Declaration Form needs to be filled up where the employer and the employee both have to give a declaration as to the rate at which PF would be deducted.

Q34) What is the interest on the PF accumulations?

Ans: Compound interest as declared by Central Govt. is paid on the amount standing to the credit of an employee as on 1st April every year.

Back to Contents PageSPECIAL PROVISION FOR INTERNATIONAL WORKERS W.E.F 11th NOV 20081) Who is an International worker?An International worker may be an Indian worker or a foreign national. This means an Indian worker who has divided his/her career between India and another country with whom India has entered into a bilateral Social Security agreement or a foreign national working in India. (Para 2 ff)

2) Who is an excluded employee under these provisions?

A detached worker posted in an establishment in India but contributing to the social security programme of the source country in terms of the bilateral Social Security agreement signed between that country and India shall be an excluded employee under these provisions. (Para 2 f)

3) Who is a detached worker?

An International worker, being not an Indian employee, contributing to the social security programme of the source country in terms of the bilateral Social Security agreement signed between that country and India and exempt from making any contribution to the Indian system for the period and terms as set out in such an agreement is a detached worker for the purpose of compliance under the Indian system. (Para 2 f)

4) What does the term Indian employee mean?

An employee, holding or entitled to hold an Indian passport and employed by an establishment covered under the EPF and MP Act, 1952 is an Indian employee under the Special provisions in respect of International workers. [Para 2 ff (a)]

5) Who all shall become the members of the fund?

a) Every International worker, other than an excluded employee - from 1st Nov.2008.b) Every excluded employee, on ceasing the status, - from the beginning of the month following that in which he/she losses the status. (Para 26)

6) Which category of establishments shall take cognizance of these provisions?

All such establishments covered/coverable under the Employees Provident Fund and Miscellaneous Provisions Act, 1952 that employ International workers either in India or abroad shall take cognizance of these provisions. (Para 26)

7) Whether PF rules will apply to an employee if his salary is paid outside India?

Yes, the provisions will apply irrespective of where the salary is paid. (Para 30)

8) Whether PF will be payable only on the part of salary paid in India in case of split payroll?

In case of split payroll the contribution shall be paid on the total salary earned by the employee. (Para 29)

9) Monthly Pay for calculating contributions to be paid under the Act?

The monthly pay shall be the pay as specified under Para 29 of the EPF Scheme, 1952, which covers: Basic wages (all emoluments paid or payable in cash while on duty or on leave / holiday except Dearness allowance, House rent allowance, overtime allowance, bonus, commission or any other similar allowance payable in respect of employment and any presents made by the employer) Dearness allowance (all cash payments by whatever name called paid to an employee on account of a rise in the cost of living) Retaining allowance Cash value of any food concession

10) What portion of salary on which PF would be payable in case an individual has multiple country responsibilities and spends some part of his time outside India?

Contribution is payable on the total salary payable on account of the employment of the employee employed for wages by establishment covered in India even for responsibility outside India also.[Section 2 (b)]

11) Is there a minimum period of days of stay in India, which the employee can work in India without triggering PF compliance?

No, there is no any minimum period of employment in India is required to be eligible for membership. Every eligible International worker has to be enrolled from the first date of his employment in India.

12) What constitutes the Pensionable service?

The service for which contributions are received and/or receivable as also the period of service rendered and considered as eligible under a Social Security Agreement that may cover an International worker. (Para 10 of EPS)

13) How is Pensionable service determined?

While the period of service for which contributions are received under the EPS will decide the quantum of pension admissible, the period of service rendered under a relevant social security agreement shall be taken into account only for the purpose mentioned under such agreement. (Para 10 of EPS)

14) Is there a cap on the salary up to which the contribution has to be made by both the employer as well as an employee?

No, there is no cap on the salary up to which the contribution has to be made by both the employer as well as an employee.

15) Is there a cap on the salary up to which the employers share of contribution has to be diverted to EPS?

Yes, the cap on the salary up to which the employers share of contribution has to be diverted to EPS remains at Rs.6500. (Para 3 of EPS)

16) What is a social security agreement (SSA)?

A social security agreement is a bi-lateral instrument to protect the interests of the workers in the host country. It being a reciprocal arrangement generally provides for avoidance of no coverage or double coverage and equality of treatment with the host country workers.

17) What are the provisions covered in a social security agreement?Generally a social security agreement covers 3 provisions. They are:

a) DetachmentApplies to employees sent on posting in the host country, provided he/she is complying under the social security system of the home country.

b) Exportability of Pension Provision for payment of pension benefits to the beneficiary choosing to reside in the territory of the home country directly with out any reduction as also to a beneficiary choosing to reside in the territory of a third country.

c) Provision for totalisation of Benefits The period of service rendered by an employee in the host country to be counted for the eligibility purpose and the payment may be restricted to the length of service, on pro-rata basis.

18) What is the status of the SSAs?As of today, Social security agreements have been signed with Belgium, France and Germany. But the date of entry into force is yet to be notified. Negotiations are at various stages with The Netherlands, Czech Republic, Hungary, Norway, Switzerland, Sweden, Luxembourg, USA and Australia. Government level talks are on with many other countries where sizable numbers of Indian workers are employed. Although not a formal agreement, there is a reciprocal arrangement between India and Korea to settle the claims of the employees on completion of employment in the host country

19) Should the eligible employees from Belgium, France and Germany contribute under the Special provisions till such time the date of effect is notified?Yes, the International workers from Belgium, France and Germany shall be enrolled as members of EPF till such time the date of effect is notified by the Government of India and after such workers obtaining a detachment certificate from the appropriate authority in their countries, respectively. Till the date of effect is notified no Indian employee posted to these countries and none of the employees from these countries working in India shall be eligible for detachment status.

20) Indian employees working abroad and contributing to Social Security Scheme of that country with whom India has social security agreement. Should they be covered for PF in India or should be treated as excluded employee?As of today the date of effect of the SSAs is yet to be notified. Therefore, a posted employee, whose name is retained in the pay bill maintained by the employer in India, shall be covered under EPF. If an Indian employee is directly employed by a local employer abroad, such an employee shall be covered by the host country legislations.

21) Could the term "Indian employee" mean any foreign national who is directly employed by an Indian establishment i.e. a person who is in India not under a secondment arrangement or any deputation from a foreign employer but hired directly by the Indian establishment under local terms and service conditions?The term Indian employee shall mean only such of those employees as explained under Q.No 4. No foreign national can be termed an Indian employee.

22) Whether a Third Country(C) National domiciled in a country (B) with which India (A) has a social security agreement is eligible for benefit under the social security agreement between India and that country?Normally social security agreements are signed to cover the Nationals of the respective countries. Therefore, the above employee may be eligible for the benefit provided that the Third country (C) has signed an enabling agreement with both India (A) as well as the Second country (B).

23) Indian employees working abroad and contributing to Social Security Scheme of that country with whom India DOES NOT have social security agreement. Should they be covered for PF in India or should be treated as excluded employee?A posted employee, who is drawing wages from the employer in India, shall be covered under EPF. If an Indian employee is directly employed by a local employer abroad, such an employee shall be covered by the host country legislations.

24) Foreign nationals who are employed in India and being paid in foreign currency, whether to be covered or not?

Yes, International workers drawing salary in any currency and in any manner are to be covered. (Section 2 f).

25) Foreigners who are employed directly as an employee by an Indian establishment abroad to be covered or not?

The local employees of an Indian establishment engaged abroad shall be covered by the local legislations

26) Considering that in most countries issuance of work permit to an individual is a trigger for social security compliance, whether the purpose and type of visa i.e. business/ employment will be a determinant for a person to be considered as an International Worker?

The purpose of the visit of an individual is the main determinant for social security compliance. The type of visa may help in determining the purpose of visit. For example - a foreign national coming in to India under an employment visa is working in India.

27) Whether benefit of reciprocity can be extended to an International Worker if his home country provides for exemption from social security to Indian nationals going to work in that country under its domestic law even though there is no social security agreement with India?

In the absence of a formal agreement the benefit of reciprocity is available at the time of withdrawal of the pension claim and not at the time of coverage. (Para 14 of EPS)

28) Where will the survivor benefits be delivered in case of a covered employee holding a passport, being other than an Indian passport, issued by a country with which India is not having a SSA?

In the absence of a SSA, the survivor benefits such as widow/widower pension, children /orphan pension, nominee/parent pension, etc. as the case may be, shall be payable to a bank account of the eligible beneficiary in India. (Para 14 of EPS)

29) What is the criterion for receiving the withdrawal benefit for the services of less than 10 years under EPS, 1995?

In respect of employees hailing from the countries with which India has signed a SSA, the withdrawal benefit shall be paid or accounted for as per the provisions of the SSA. In all other cases, it shall be guided by the principle of reciprocity with reference to the entitlement available to Indian employees in the other country. (Para 14 of EPS)

30) How long an Indian employee retains the status of International worker?

An Indian employee attains the status of International worker only on account of his employment in a country with which India has signed a SSA. He shall remain in that status till the time he avails the benefits under a social security programme covered under that SSA. (Para 2 f)

31) Under what condition the contributions received in the PF account are payable along with interest?

The full amount standing to the credit of a members account is payable if any one of the circumstances mentioned under Para 69 of the EPF Scheme, 1952 is fulfilled

32) Is there a cap on the salary up to which the contribution has to be made to EDLI Scheme by both the employer?Yes, the cap on the salary up to which contribution has to be made to EDLI Scheme remains unchanged at Rs.6500.

Back to Contents PageTHE PAYMENT OF BONUS ACT-1965

Q1) What are the objects of the Act? Ans: This act ensures that employees have a statutory right to share the profits of the employer.

Q2) What is the minimum bonus prescribed by the Act?

Ans: The minimum bonus prescribed by the Act is 8.33 % of annual basic salary, which is equivalent to one months basic salary or Rs. 100 whichever is higher.

Q3) What is the maximum bonus payable under the Act?Ans: The maximum bonus payable under the Act is two and a half months basic salary or 20 % of annual basic salary.

Q4) What is the applicability of the act?

Ans: This Act is applicable to all establishments employing 20 or more persons.

Q5) In case after registering the establishment at any point in time, the number of employees working in it becomes less than 20 then will the Act apply?Ans: Any establishment which has been covered under the Act once shall continue to be governed by the Act even if the number of persons employed therein at any time falls below 20.

Q6) Who are entitled to be paid bonus?

Ans: Any employee who is drawing a salary or wages up to Rs. 10,000 per month and who has worked for a minimum period of 30 days in a year is entitled to bonus.

Q7) Is a casual worker (whose job is not throughout the year but only for a few months) entitled to bonus?Ans: The only criteria for being entitled to bonus is to complete minimum period of 30 days of work in a year to be eligible for bonus.

Q8) For the purpose of this Act, what does the term wages include?

Ans: For the purpose of this Act wages means Basic salary + D. A. and does not include allowances, overtime salary, HRA, bonus, gratuity, employer's contribution to PF.

Q9) What is the time limit for an employer to pay the bonus?

Ans: Bonus must be paid within a period of 8 months from the close of the accounting year. If an employee does not get the bonus due to him, he can apply to the Government.

Q10) Why has the Act specified the maximum and minimum limit of the bonus?

Ans: The principle behind fixing the maximum and minimum limit of the bonus is that the rate of bonus should not fluctuate from year to year.

Q11) Can an employee hold or deduct the bonus payable to an employee.Ans: Only in case the employee is found guilty of misconduct causing financial loss to the employer, then the employer can deduct the or hold the employee's bonus.

Q12) In case there is a dispute regarding the payment of bonus then when is the bonus payable?

Ans: Bonus is payable to the employee within 30 days of settlement of such dispute.

Q13) Can the employer have an agreement with the employee for a different rate of payment of bonus?Ans: Yes, there can be an agreement between the employer and the employee for a different rate of payment of bonus but then they need to follow the Act,i.e., Maximum of 20 % of basic & minimum of 8.33 % of basic salary.

Q14) Which establishments are exempt from paying bonus to its employees?

Ans: Any establishment which is newly set up is exempted from paying bonus to its employees in the first five years. If however the employer gains profits in the first five years then he has to pay bonus to its employees.

Q15) In case there is a change in the ownership of the establishment then is the establishment exempt from paying bonus?Ans: No, even if the ownership of the establishment has changed it will not be considered as a newly set up establishment and has to pay bonus.

Q16) When is the employee disqualified to receive bonus?Ans: Any employee who is dismissed from the services on account of fraud, riotous or violent behaviour, theft, misappropriation, or causes damage to company properties looses his claim on bonus.

Q17) In case the employee is entitled to bonus of last year but this year he/ she is dismissed on account of theft, fraud and dishonesty then can the employer hold the employee's previous bonus?Ans: In such a case the employer cannot hold the due bonus of the previous year.

Q18) If the employee is laid off and paid lay off wages then is the employee entitled to bonus for the period he/ she is laid off?Ans: In case of lay off the employee receives lay off wages then these wages would be considered as wages in the purview of this Act and the employer needs to pay bonus.

Q 19) In case the employer has a lot of branches/ departments which are spread over many places or states then will it considered as separate establishments or one single establishment?Ans: In such cases the establishment would be considered as one single establishment.unless a separate balance sheet and profit or loss account is prepared.

(Calculation of bonus with respect to certain employees) Where the salary or wage of an employee exceeds [three thousand and five hundred rupees] per mensem,(earlier it was two thousand and five hundred rupees per mensem) the bonus payable to such employee under section 10 or, as the case may be, under section 11, shall be calculated as if his salary or wage were [three hundred and five hundred rupees] per mensem(earlier it was two thousand and five hundred rupees per mensem)Back to Contents PageTHE MATERNITY BENEFIT ACT-1961

Q1) What is the purpose of this Act?Ans: The purpose of this Act is to regulate the employment of women workers for certain period before and after childbirth.

Q2) To which establishments is the Act applicable?Ans: This Act is applicable to every establishment employing 10 or more persons.

Q3) To which employees is the Act applicable?Ans: This act is applicable to female employees who are employed whether on regular employment or on casual basis.

Q4) Are daily wages employees entitled to maternity benefit under this Act?Ans: Female employees employed as casual employees/ daily rated employees are also entitled to maternity benefit under this Act.

Q5) To whom is the maternity benefit payable in case of death of an employee?Ans: In case of death of an employee maternity benefit is payable to the person nominated by or the legal heir of the woman.

Q6) Can a woman be terminated when she is on maternity leave?Ans: A woman cannot be terminated when she is on maternity leave.

Q7) What is the period for which a woman is entitled to maternity benefit?Ans: A woman is entitled to maternity benefit of 12 weeks, six weeks before and six weeks after the due date of delivery.

Q8) What is the eligibility of an employee to claim maternity benefit?Ans: Any woman who has worked for more than 80 days during the preceeding 12 months of the date of delivery.

Q9) What is the rate at which the woman is entitled to maternity benefit?Ans: Rate of Maternity benefit is the rate of average daily wage for the period she has worked.

Q10) What is meant by Average Daily Wages?Ans: Average daily wages means the average of the women wages payable to her for the days on which she has worked during the period of 3 calendar months immediately preceeding the date from which she absents herself.

Q11) What is the maternity bonus a woman is entitled to? Ans: A woman is entitled to maternity bonus of 1000 Rupees in case no pre-natal or postnatal care is provided by the employer.

Q12) Is medical bonus paid over and above the maternity benefit?Ans: Yes, Medical bonus of Rs. 1000 is provided over and above the maternity benefit.

Q13) Is a woman entitled to any leave in case of illness arising out of pregnancy delivery?Ans: A woman is entitled to leave with wages up to maximum one month for illness arising out of pregnancy, delivery, pre-mature birth or miscarriage..

Q14) Is a woman entitled to leave with wages for miscarriage?Ans: In case of miscarriage a woman is entitled to leave with wages at the rate of maternity benefit for a period of 6 weeks immediately following the date of miscarriage.

Q15) What is the entitlement of a woman in case of MTP (Medical Termination of Pregnancy)?Ans: In case of MTP (Medical Termination of Pregnancy) a woman is entitled to leave with wages at the rate of maternity benefit for a period of 6 weeks immediately following the date of MTP.

Q16) Is it necessary for a woman to work for 80 days in the preceeding 12 months to claim benefit in case of MTP or miscarriage?Ans: No, there is no such condition laid out for a woman to claim benefit in case of MTP or miscarriage.

Q17) In brief, what are the obligations of the employer?Ans: The employer is required to:

1.Exhibit an abstract of the Act in the establishments

2.Maintain a muster roll

3.Submit annual returns

Q18) What is the leave entitlement for tubectomy operation?Ans: In case of tubectomy operation, a woman is entitled to maternity benefit for a period of two weeks immediately following the day of her operation.

Back to Contents PageTHE CONTRACT LABOUR REGULATION & ABOLITION ACT-1970

Q1) What is the policy governing this Act?Ans: The policy of this Act is to prohibit the employment of contract labour in certain employments & govern the working conditions and provide health and welfare facilities to the Contract Labour.

Q2) To whom is this Act applicable?Ans: This Act is applicable to every establishment where 20 or more workmen are employed as Contract labour or every contractor employing 20 or more workmen. In certain States it is applicable to 10 or more workmen. (State Amendments).

Q3) Are there any establishments to which this Act is not applicable?Ans: This Act is not applicable to establishments performing work only of an intermittent or casual nature.

Q4) What is the primary duty of the contractor?Ans: The primary duty of the Contractor is to obtain a license as per the Act

Q5) What is the primary duty of the principal employer?Ans: The principal employer needs to get his establishment registered under the Act.

Q6) What is the procedure for obtaining a license under the Act?Ans: The contractor needs to apply in the prescribed format and pay the necessary fees and security deposit to the Licensing Officer under the Act. The security deposit is refundable.

Q7 What about the validity of the license?Ans: The license is valid for a year and it needs to be renewed every year. The application for license should be made within 60 days of the date of expiry of the license.

Q 8 What in case the registration certificate or the license is lost?Ans: In case of loss of the registration certificate or the license a duplicate should be obtained from the licensing officer on payment of prescribed fees.

Q9 What in case the employer doesnt take the certificate of Registration ?Ans: In case the employer has not obtained the certificate of Registration then he would be considered as a Principal employer for all the worker employed as Contract labour.

Q10 What is the liability for the Principal employer in case the contractor fails to provide the salary and welfare facilities as per the Act?Ans: The Principal Employer would be responsible for the payment of wages to the Contract Labour and inurn the Principal Employer can recover such amount from the payment due to the Contractor.

Q11 As per the Act what are the facilities, which are to be provided to the contract labour & by whom?Ans: A contractor is required to provide canteens, rest room, latrines, urinals, drinking waters, washing facilities, and first aid boxes to the contract labour & in case the contractor fails to provide these facilities it is the responsibility of the principal employer to provide the same.

Q12. What are the powers of the inspectors appointed under the act?Ans: An inspector can enter any premise where contract labour is employed and examine any register, record or notices. He can examine any workman employed in the premise and ask them about their work and payment. He can also seize or take copies of any register, record of ages or notices.

Q13. What kind of returns need to be submitted by the principal employer?Ans: The principal employer needs to send annual returns in the prescribed form to the registering officer not later than 15th Feb of every year.

Q14. What kind of returns need to be submitted by the contractor?Ans: Every contractor is required to send to the licensing officer half yearly return in the prescribed form not later than 31st July & 31Jan of every year.

Back to Contents PageTHE EMPLOYEE STATE INSURANCE ACT, 1948

1. What is E.S.I. Scheme?

In addition to necessities of food, clothing, housing etc., man needs security in times of physical and economic distress consequent upon sickness, disablement etc. The Employees State Insurance Scheme is an integrated measure of Social Insurance embodied in the Employees State Insurance Act and is designed to accomplish the task of protecting employees as defined in the Employees State Insurance Act against the hazards of sickness, maternity, disablement and death due to employment injury and to provide medical care to insured persons and their families. The Scheme covers employees of non-seasonal power-using factories employing 10 or more persons. There is, however, a built-in provision for its extension to other establishments or classes of establishments, industrial, commercial, agricultural or otherwise. The Scheme has been progressively extended to cover employees in non-power using factories employing 20 or more persons and to commercial establishments.

2.How does the Employees State Insurance Scheme assist you?

The dependence of an individual on cash income is a characteristic feature of modern economy. An interruption of money income even for a small period is, therefore, a hardship; a prolonged loss of income is indeed a catastrophe. By coming forward to provide health protection and income maintenance in a series of oft-experienced contingencies like sickness, maternity, disablement and death due to employment injury, the Employees State Insurance Scheme tends to ameliorate your economic anxiety and to be a friend in need and distress.

3.Why is it called a Health Insurance Scheme?

The Employees State Insurance Scheme performs a dual role; by providing assistance in kind (medical care) it tries to restore your health and working capacity and by assistance in cash (cash benefit) it tries to sustain you when your income is interrupted. With a better and facile health protection, greater vitality, and assurance of income-maintenance in times of need, it makes you every inch a better, a healthier, secure worker and therefore, a happier man. The assistance comes to you not as an act of benevolence but in virtue of an acquired right.

4.Who administers the Employees State Insurance Scheme?

The Employees State Insurance Scheme is administered by a corporate body called the Employees State Insurance Corporation (ESIC), which has members representing Employees, Employers, the Central Government, State Governments, Medical Profession and the Parliament. The Director General is the Chief Executive Officer of the Corporation and is also an ex-officio member of the Corporation. The other bodies at the national level are the Standing Committee (a representative body of the Corporation) and the Medical Benefit Council, a specialized body which advises the Corporation on administration of Medical Benefit. At the Regional and Local levels, the Regional Boards and Local Committees have been constituted. There is, thus, an association of interests and interest groups at all levels.

ESIC is the trustee of the interests of the insured persons. It discharges its obligations and duties through a network of Regional Offices and Local Offices, Hospitals and Dispensaries spread over the entire country.

5.Whom does the Scheme protect?

The Scheme protects all employees engaged on a monthly remuneration not exceeding Rs. 15,000/- in a factory/establishment to which the Act applies. Persons employed for wages on any work connected with the administration of the factory or establishment or any part, department or branch thereof or purchase of raw materials, or distribution or sale of the product of a factory or establishment are also covered. Mines, Railway Running Sheds, Naval, Military and Air Force Workshops and specified seasonal factories are excluded. The scheme also provides full medical cover to the dependants of insured persons. In the event of death of an insured person due to employment injury dependants become eligible to cash benefit.

6.Where do Employees State Insurance Funds come from?

The Employees State Insurance Funds are primarily built out of employers contribution and employees contribution payable monthly as a fixed percentage of wages.

7.How are the employees registered under the Scheme?

Simultaneously with his/her entry into employment in a covered factory or establishment, an employee is required to fill in a Declaration Form. The employee is then allotted a Registration Number, which distinguishes and identifies the person for the purposes of the Scheme. A person is registered once and once only upon his entry in insurable employment.

8.What is an Identity Card?

On registration every insured person is provided with a Temporary Identification Certificate which is valid ordinarily for a period of 3 months but may be extended, if necessary, for a further period of 3 months. Within this period, the Insured Person is given a permanent family photo Identity Card in exchange for the Certificate. The Identity Card serves as a means of identification and has to be produced at the time of claiming medical care at the dispensary/clinic and cash benefit at the Local Office of the Corporation. In the event of change of employment, it should be produced before the new employer as evidence of registration under the Scheme to prevent any duplicate registration. The Identity Card bears the signatures/thumb impression of the insured person.

Since medical benefit is also available to the families of insured persons, the particulars of family members entitled to Medical Benefit are also given in the Identity Card affixed with a postcard size family photo.

If you lose your Identity Card before it has run its normal life, a duplicate card is issued on payment as prescribed.

9.What are the rates of contribution?

Contributions payable in respect of an employee comprise of employers contribution and employees contribution prescribed in Schedule I of the Act.

An employee covered under the scheme has to contribute 1.75% of the wages whereas; an employer contributes 4.75% of the wages payable to an employee. The total contribution in respect of an employee thus works out to 6.50% of the wages payable.

10.Who is exempted from payment of contribution?

Employees earning less than Rs 40/- a day are exempted from payment of contribution. The employers share of contribution is, however, payable.

11.How are the Contributions collected?

The Contribution is deposited by the Employer in cash or by cheque at the designated branches of some nationalized banks. The responsibility for payment of all contributions is that of the employer with a right to deduct the Employees share of contributions from employees wages relating to the period in respect of which the Contribution is payable.

12.What are Contribution Periods and Benefit Periods?

Workers, covered under the ESI Act, are required to pay contribution towards the scheme on a monthly basis. A contribution period means a six-month time span from 1st April to 30th September and 1st October to 31st March. Thus, in a financial year there are two contribution periods of six months duration.

Cash benefits under the scheme are generally linked with contributions paid. The benefit period starts three months after the closure of a contribution period. The two types of periods are illucidated below:

Contribution PeriodCorresponding Benefit period

1st April to 30th September

1st January to 30th June of the

Following Year

1st October to 31st March 1st July to 31st December

13.What is a Local Office?

A network of Local Offices has been established by the Corporation in all implemented areas to disburse all claims for sickness, maternity, disablement and dependents benefit. The Local Office also answers all doubts and enquiries and assists otherwise in filling in claim forms and completing other action necessary in connection with the settlement of claims. These offices also interact with the employers of the area. The Local Offices are managed by a Manager and work under the direction and control of the Regional Offices.

14.What does Sickness Benefit mean?

Sickness signifies a state of health necessitating medical treatment and attendance and abstention from work on medical grounds. Financial support extended by the Corporation is such a contingency is called Sickness Benefit.

15.What are the Contributory Conditions?

The contribution condition required to be fulfilled for admissibility of sickness benefit during any benefit period is that contributions should have been paid in respect of an insured person in the corresponding contribution period for not less than 78 days.

16.How much is the Standard Benefit Rate?

The daily rate of Sickness Benefit during any benefit period is the standard benefit rate this rate corresponds to the average daily wage of an insured person during the corresponding contribution period and is roughly half of the daily wage rate. Benefit is paid for Sundays also. 28 wage groups have been evolved for working out the daily rate of Standard Sickness Benefit. Standard Benefit rates for 28 wage groups are shown in Annexure A.

17.What is the duration of Sickness Benefit?

Sickness benefit is payable for a maximum period of 91 days in any two consecutive benefit periods. Benefit is not paid for an initial waiting period of 2 days unless the insured person is certified sick within 15 days of the last spell in which Sickness Benefit was paid.

18.What is Extended Sickness Benefit?

Extended Sickness Benefit is a Cash Benefit paid for prolonged illness due to any of the 34 specified diseases as mentioned below.

Diseases

1. Tuberculosis

2. Leprosy

3. Chronic Emphysema

4. Bronchiectasis

5. Interstitial Lung disease

6. AIDS

7. Malignant Diseases

8. Diabetes Mellitus-with proliferate retinopathy/diabetic foot/ nephropathy.

9. Monoplegia

10. Hemiplegia

11. Paraplegia

12. Hemiparesis

13. Intracranial space occupying lesion

14. Spinal Cord Compression

15. Parkinsons disease

16. Myasthenia Gravis/Neuromuscular Dystrophies

17. Immature Cataract with vision 6/60 or less

18. Detachment of Retina

19. Glaucoma

20. Coronary Artery Diseases

21. Congestive Heart Failure-Left, Right

22. Cardiac valvular Diseases with failure/complications

23. Cardiomyopathies

24. Heat disease with surgical intervention along with complications

25. Chronic Obstructive Long diseases (COPD) with congestive heart failure (Cor Pulmonale)

26. Cirrhosis of liver with ascitis/chronic active hepatitis (CAH)

27. Dislocation of vertebra/prolapse of intervertebral disc

28. Non union or delayed union of fracture

29. Post Traumatic surgical amputation of lower extremity

30. Compound fracture with chronic osteomyelitis

31. (a)Schizophrenia

(b)Endogenous depression

(c)Maniac Depressive Psychosis (MDP)

(d)Dementia

32.More than 20% Burns with infection/complication

33.Chronic Renal Failure

34.Reynauds disease/Burgers disease.

In addition, extended sickness benefit may also be sanctioned by the prescribed authority, in case of any rare disease or special circumstances on the recommendation of the specified authority.

19.What are the Contributory Conditions?

Except in case of disability from administration of drugs/injections, the insured person should have been in continuous employment for a period of 2 years and should have contributed for at least 156 days in 4 preceding contribution periods.

20.How much is the Benefit rate?

The daily rate of Extended Sickness Benefit is 40% more than the Standard Sickness Benefit rate admissible.

21.How long is the Benefit available?

After exhausting Sickness Benefit payable for 91 days the ESB is payable upto a further period of 124/309 days that can be extended upto 2 years in special circumstances. Thus, together with the Sickness Benefit for 91 days, it puts a claimant on benefit for an aggregate period 400 days for all specified diseases and 2 years in chronic suitable cases on recommendation of competent authority.

22.What is Enhanced Sickness Benefit?

Enhanced Sickness Benefit is cash benefit for the insured persons undergoing sterilization operation of vasectomy/tubectomy for family planning.

22a.What are the contributory conditions?

The contributory conditions are the same as for claiming sickness benefit.

22b.How much is the benefit rate?

The daily rate of this benefit is double the standard benefit rate. Say, not less than the daily wage.

22c.How Long is the benefit available?

The benefit is available upto 7 days for vasectomy and upto 14 days for tubectomy operations. This period can however be extended in cases of postoperative complications or sickness arising out of these sterilization operations. Its duration is not counted towards the total number of 91 days for which the sickness benefit is available during any two consecutive benefit periods.

22d.How to claim Sickness Benefit?

A claim for Sickness Benefit should be supported by a Medical Certificate issued by an Insurance Medical Officer/Insurance Medical Practitioner in the appropriate Form. Medical Certificates are issued at intervals of not more than seven days, except in cases of prolonged sickness, where Special Intermediate Certificates may be issued at longer intervals not exceeding 4 weeks. On the back of each certificate, except the Special Intermediate Certificate, a Claim Form is printed. The Claim Form is essentially a declaration in regard to abstention of the claimant from work during the period of claim. Separate Claim Forms are also available.

The Claim Form should bear signatures/thumb impression of the claimant and should be submitted to the Local Office personally, by post, through a messenger or by deposit in certificate boxes, wherever provided. All claims should preferably to submitted to the Local Office within three days. The Receptionist at the Local Office renders all assistance in filling in the claim on your behalf.

23.What is Disablement?

Disablement is a condition resulting from employment injury, which may be:

(a)Temporary i.e. rendering an insured person incapable of work temporarily and necessitating medical treatment;

(b) Permanent partial i.e. reducing the earning capacity of the insured person generally for every

employment;

(c) Permanent total i.e. totally depriving the insured person of the power to do all work.

24.What constitutes an Employment Injury?

Employment injury means a personal injury caused to an employee by an accident or occupational disease arising out of and in course of his employment in a factory or establishment covered under the Employees State Insurance Act.

The law relating to Employment injury has been liberalized. Now, an accident arising in the course of employment is presumed also to have arisen out of his employment if there is no evidence to the contrary. Further, an accident brought about by willful disobedience, negligence or breach of regulations etc. or an accident happening while traveling in a transport provided by the employer or while meeting an emergency is accepted subject to certain conditions, to have arisen in the course of and out of employment. Injuries suffered while under the influence of drinks and drugs take away the right of the employee to this benefit.

Roadside accident caused while commuting between place of residence and workplace is also treated as notional extension of employment for purpose of death or disablement benefit.

25.What are Occupational Diseases?

Occupational Diseases are such diseases as are susceptible of being traced back to their occupational origin. These are specified under Schedule III of the Employees State Insurance Act, which enumerates the compensable Occupational Diseases and the corresponding industrial processes involving exposure to the diseases are thus recognized without any further evidence.

26.What are the Benefits granted?

Temporary Disablement Benefit is paid periodically in arrears as the evidence of incapacity (medical certificate) is produced. Permanent total disablement and permanent partial disablement benefits are paid in the form of pensions. Current employment for wages or engagement in any gainful activities is no bar to payment of permanent disablement benefits. An insured person suffering from an occupationed disease is also entitled to full medical care.

27.How much is the Benefit Rate?

The daily benefit rate for permanent total disablement and temporary disablement is 40% more than the Standard Sickness Benefit rate and is roughly equivalent to about 70% of the wage rate. For permanent partial disablement, the rate of benefit is proportionate to the percentage of loss of earning capacity. The benefit is paid for Sundays also.

28.What are the Contributory Conditions?

There are no qualifying conditions as to the length of employment or the number of contributions paid. Protection accrues from the very moment of entry into insurable employment.

29.What is the duration of Benefit?

Temporary Disablement Benefit is paid as long as disablement lasts. There is a waiting period of 3 days (excluding the day of accident), but if incapacity exceeds this period, benefit is paid from the very first day. The permanent disablement benefit is paid for the life-time of the beneficiary.

30.How is Permanent Disablement assessed?

There is indeed no way of adequately compensating a permanently disabled employee and yet some method of determining whether an employment injury has resulted in permanent disablement and of assessing the extent of permanent damage caused by that employment injury has to be adopted for the purpose of determining the scale of compensation for the loss of earnings. This is done by evaluating loss of earning capacity with reference to general disability for all work. The evaluation is done by a Medical Board whose decision can be appealed against to a Medical Appeal Tribunal presided over by a judicial officer, with a further right of appeal to Employees Insurance Court or directly to Employees Insurance Court. Pending an appeal, payment for permanent loss of earning capacity as recommended by the Medical Board is made, subject to adjustment later. Loss of wages and expenditure on conveyance occasioned by attendance before the Medical Board are compensated by the Corporation in accordance with rates framed for the purpose.

Where the assessment of loss of earning capacity by the Medical Board is not of a final character, the beneficiary is required to appear again before the Medical Board for a review of the assessment.

31.Can the decisions of Medical Board or of Medical Appeal Tribunal be reviewed?

Yes. If the Medial Board or the Medical Appeal Tribunal is satisfied by fresh evidence that a decision was given because of non-disclosure or misrepresentation of a material fact, it can review its earlier decision at any time. A Medical Board can also review its earlier assessment of extent of disablement, if it is satisfied that there has been substantial and unforeseen aggravation of the results of the relevant injury and substantial injustice would be done by not reviewing it. Such review, however, cannot be made earlier than 5 years or in the case of the provisional assessment, earlier than 6 months of the date of assessment to be reviewed.

32.Is lump sum Benefit allowed in place of Pension?

Yes. At the option of the beneficiary, permanent disablement pension, where the daily rate payable is not significant, can be commuted for a lump sum payment subject to the fulfillment of the following two conditions:

(i) That the permanent disablement has been assessed as final, and

(ii) The daily rate of permanent disablement does not exceed Rs 5/- and the total commuted value does not exceed Rs 30,000/- (effective from April03).

33.How to claim Disablement Benefit?

(a)Temporary Disablement:

(i) Notice of the injury should be given either orally or in writing personally or through an agent, to the employer/foreman/duty supervisor or particulars of the injury should be entered in the Accident Book kept in the factory, personally or through an agent.

(ii) A medical certificate of incapacity should be obtained from the Insurance Medical Officer/Insurance Medical Practitioner.

(iii) The claim form printed on the back of the medical certificate should be filled in and submitted promptly to Local Office along with the medical certificate.

(iv) A final certificate should be obtained from the Insurance Medical Officer/Insurance Medical Practitioner and submitted to the Local Office before resumption of duty.

(b)Permanent Disablement:

(i) If suffering from permanent effects of employment injury, the insured person should make an application to the Regional Office of the Corporation for reference of his case to the Medical Board (reference to the Medical Board is made otherwise also by the Regional Office).

(ii) Where loss of earning capacity has been assessed and communicated to the insured person, he should submit a claim in the appropriate form to the Local Office.

(iii) After the claim has been admitted, the beneficiary should submit at six-monthly intervals (with the claim for June and December every year) a life certificate in appropriate form duly attested by the prescribed authority.

34.Is there any provision for physical rehabilitation?

Yes. Insured Persons who suffer physical disablement due to employment injury are provided artificial appliances or other physical aids such as wheel chairs, crutches, dentures and spectacles etc.

35.What about vocational rehabilitation?

The Corporation at its cost arranges for the vocational rehabilitation of disabled insured persons provided the disability has been assessed at above 40 percent and the beneficiary is not over 45 years of age. The training is provided at vocational rehabilitation centers run by the Govt. of India etc. The fee, travelling expenses etc are borne by the Corporation.

36.What is Dependents Benefit?

Dependents Benefit is a monthly pension payable to the eligible dependents of an insured person who dies as a result of an Employment Injury or occupational disease.

37.Who are the Beneficiaries and how long is the Benefit available?

Dependants entitled to the benefit could be:

(a) Widow/Widows during life or until remarriage:

(b) Legitimate or adopted son until age 18 or if legitimate son is infirm, till infirmity lasts;

(c) Legitimate or adopted unmarried daughter until age 18 or until marriage, whichever is earlier, or if infirm, till infirmity lasts and she continues to be unmarried.

In the absence of any widow or legitimate child, the benefit is payable to a parent or grandparent for life, to any other male dependant until age 18 or to an unmarried or widowed female dependant until age 18.

38.How much is the Benefit for each Beneficiary?

The total divisible benefit is equivalent to the temporary disablement benefit rate (roughly 70% of the wage rate). The widow/widows share 3/5th of the benefit and the legitimate or adopted son and daughter 2/5th each of the benefit. If the total benefit so divided exceeds the full rate, there is a proportionate reduction in the respective shares of the beneficiaries.

39.How to claim Dependants Benefit?

To establish title to Dependant Benefit, the following documents should be submitted at the Local Office:

(a) Claim in the appropriate form;

(b) Evidence of death being due to employment injury;

(c) Proof of relationship to the deceased supporting eligibility of the claimant as a dependant;

(d) Evidence of age of the claimant(s) (certified copy of official record of birth, Baptismal register, school records, original horoscope etc;

(e) Certificate of infirmity from Medical Referee or any other prescribed authority in case of legitimate infirm son or legitimate or adopted unmarried infirm daughter.

After the claim to Dependants Benefit has been admitted, the beneficiary should submit at six-monthly intervals (with the claim for June and December), a declaration that he/she is alive and has not married/remarried attained the prescribed age/continues to be infirm, as the case may be duly attested by the prescribed authority.

40.Can Dependants Benefit be reviewed?

Yes. Dependants Benefit once awarded can be reviewed by the Corporation at any time if it is satisfied on fresh evidence that the earlier decision was due to non-disclosure or misrepresentation of material facts. It can also be reviewed on birth, death, marriage, re-marriage and attainment of age 18, by a claimant. The benefit can be continued, increased, reduced or discontinued.

41.What is Maternity Benefit?

Maternity Benefit is cash payable to an insured woman for the specified period of abstention from work for confinement or miscarriage or for sickness arising out of pregnancy, confinement, premature birth of child or miscarriage. Confinement connotes labour resulting in the delivery of a living child or labour after 26 weeks of pregnancy whether the resultant issue is alive or dead. Miscarriage means expulsion of the contents of a pregnant uterus at any period prior to or during 26th week of pregnancy. Criminal abortion or miscarriage does not, however, entitle to benefit.

42.What are the Contributory Conditions?

The contribution condition is the same as for Sickness Benefit.

43.How much is the Benefit?

The daily benefit rate is double the Sickness Benefit rate and is thus roughly equivalent to the full wages. Benefit is paid for Sundays also.

44.What is the duration of the Benefit?

The Benefit is paid as follows:

(a)For confinement:

For a total period or 12 weeks beginning not more than 6 weeks before the expected date of child birth. If the insured woman dies during confinement or within 6 weeks thereafter, leaving behind the living child, the benefit continues to be payable for the whole of the period. But if the child also dead during that period, the benefit will be paid upto and including the day of death of the child.

(b)For Miscarriage:

For a period of 6 weeks following the date of miscarriage.

(c)For Sickness arising out of pregnancy, confinement, and premature birth of child or miscarriage:

For an additional period of upto four week.

In all the cases, the benefit is paid only if the insured woman does not work for remuneration during the period for which benefit is claimed. There is no waiting period.

45.How to claim Maternity Benefit?

Where an insured woman wishes to claim Maternity Benefit after confinement or for miscarriage, she should obtain from the Insurance Medical Officer/Insurance Medical Practitioner, a certificate of confinement or miscarriage and submit it to her Local Office personally or by post along with a claim for Maternity Benefit. The claim form also contains a declaration of abstention from work.

If Benefit is desired before confinement, a Notice and Certificate of Pregnancy and a Certificate of Expected Confinement obtained from the Insurance medical Officer/Insurance Medical Practitioner are also required to be submitted.

For claiming Benefit in the event of death of an insured woman leaving behind a child, her nominee and if there is no such nominee, her legal representative should submit personally or by post to the Local Office of the deceased insured woman, a claim for the Benefit together with a certificate of death of the insured woman.

An insured woman claiming Maternity Benefit for Sickness arising out of pregnancy, confinement, premature birth of child or miscarriage should submit her claim in the manner as for sickness benefit.

Where a claim to Maternity Benefit is not submitted along with prescribed certificates referred to above, the Corporation has the discretion to accept other evidence in lieu thereof.

46.What is Medical Bonus?

Medical Bonus is lump sum payment made to an insured woman or the wife of an insured person in case she does not avail medical facility from an ESI hospital at the time of delivery of a child. This bonus of Rs. 250/- has been increased to Rs. 1000/- from 1st April 2003.

47.What is Medical Benefit?

Medical Benefit means medical care of insured persons and their families, wherever covered for medical benefit.

48.What does Medical Benefit consist of?

The standard medical care consists of out-door treatment, in-patient treatment, all necessary drugs and dressings, pathological and radiological specialist consultation and care, ante-natal and post natal care, emergency treatment etc.

49.Where are out-patient services provided?

Out-door medical care is provided at State Insurance Dispensaries or Mobile Dispensaries manned by full-time doctors (Service system) or at the private clinics of Insurance Medical Practitioners (Panel system). The scope of medical services also includes simple antenatal and post-natal care for women, family welfare planning services and immunization against the common infectious diseases.

The Scheme provides at the sole cost of the Corporation, artificial limbs to insured persons who lose their limbs due to employment injury or in certain circumstances otherwise also, dentures, spectacles and hearing aids where the loss of teeth, impairment of eyesight or hearing respectively is due to employment injury.

50.How and where are in patient Services Provided?

ESIC has a network of 141 hospitals countrywide. Majority of these hospitals are administered by the State Govts. In patient and diagnostic services in basic specialties are available at these hospitals. State schemes have also tie-up arrangements with a number of Medical colleges, major state hospitals, as well as, private hospitals for advanced treatment for malignant diseases and complicated surgical interventions.

51.What about Preventive health care services?

ESI Scheme provides preventive health care services through the network of its dispensaries and hospitals. These include immunization against some killer diseases, pulse polio vaccination and family welfare services etc. The scheme also participates in all major national preventive health service campaigns.

52.How long is Medical Benefit available?

Insured worker and the members of his family are eligible for medical care from the very first day of the worker coming under ESI Scheme. The medical care includes primary medical care, diagnostic services, specialist consultations and indoor medical care. Whenever the patient is not able to travel by himself/herself, ambulance services are also provided. The I.P. or his family members are not required to pay for any of the services.

A worker who is covered under the Scheme for the first time is eligible for medical care for a period of three months. If he/she continues in insurable employment for three months or more the medical care is available to him/her till the start of the first benefit period. If he/she contributes at least for 78 days in a contribution period the eligibility is there upto the end of the corresponding benefit period.

A worker is also eligible for extended sickness benefit when he/she is suffering from any one of the long-term 34 diseases listed in the Act. This is admissible after the worker has been under ESI coverage for at least 2 years during which he/she should have contributed at least for 156 days. When these conditions are satisfied medical benefit is admissible for a maximum period of 730 days for the I.P. and his/her family.

53.What are Funeral expenses?

This component consists of a lump sum payment towards the expenditure on the funeral of the deceased insured person.

54.What is the amount payable?

The lump sum amount of this benefit is equal to the actual expenditure, not exceeding Rs. 3000/- towards the funeral of the deceased insured person.

55.Are there any Contribution Conditions?

No contribution condition is required for this Benefit. The only condition for admissibility of this Benefit is that the deceased person should have been an insured person at the time of his death. The Funeral expenses are thus payable in respect of an insured person in receipt of Permanent Disablement Benefit even if he may not be employed at the time of his death in a factory or establishment covered under the ESI Act.

56.To whom are the Funeral expenses payable?

The expenses are payable to the eldest surviving member of the family of the deceased insured person. If the insured person did not have a family or if he was not living with his family at the time of his death, the benefit is payable to the person who actually incurs the expenditure on the funeral of the deceased insured person.

57.How to claim the Funeral expenses?

To claim the expenses, the claimant should submit his/her claim personally or by post to the Local Office of the deceased insured person within three months, together with the following documents:

(a) Death certificate as proof of death of the insured person issued by the Insurance Medical Officer/Insurance Medical Practitioner or such other Medical Officer of a hospital or other institution who attended the insured person at the time of death or examined the body after the death; (Death certificate issued by cremation/burial ground or by Municipal authorities or certified copy of village etc. death records may also be accepted as evidence of death);

(b) A declaration of the claimant, either

(i) That he is the eldest surviving member of the family of the deceased insured person and incurred expenditure on the funeral of the deceased. or

(ii) In case the claimant is other than the eldest surviving member of the family, that the deceased insured person did not have a family or was not living with his family at the time of his death and that the claimant actually incurred expenditure on the funeral of