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ESI or Employee State Insurance is a self-financing social security and health insurance scheme for Indian workers. The ESI scheme is managed by the Employees’ State Insurance Corporation (ESIC), which is an autonomous body under the Ministry of Labour and Employment, Government of India. In this article, let us learn more about ESI, ESI full form, the benefits of ESI, how to register for ESI and other related info.
History
Employee State Insurance (ESI) is a self-financing social security and health insurance scheme for Indian workers. It is managed by the Employees’ State Insurance Corporation (ESIC) according to rules and regulations stipulated in the ESI Act 1948.
The history of ESI dates back to the 1920s when a Royal Commission was set up to consider the question of workers’ welfare in India. The commission’s report recommended the introduction of a contributory system of insurance against sickness, maternity, disability, and death due to employment injury. However, it took almost three decades for the Indian government to implement the recommendations.
The ESI Act, 1948 was passed in the Lok Sabha on 24th June, 1948 and came into force on 1st July, 1952. The Act is applicable to non-seasonal factories employing 10 or more persons. It is also applicable to shops, hotels, restaurants, cinemas, road-motor transport undertakings, and newspaper establishments employing 20 or more persons.
The ESI Act provides certain benefits to employees in the event of sickness, maternity, disability, or death due to an employment injury. These benefits include medical care, cash benefits, and other services. Employees are required to contribute 1.75% of their wages towards the ESI Scheme while employers are required to contribute 4.75%.
The ESI Act has since been amended several times to make it more comprehensive and to include more benefits for the workers. In 2010, the Act was amended to include a provision for the portability of benefits across different states. In 2012, the Act was further amended to provide for the payment of wages to the dependents of employees in the event of death or disability due to an employment injury.
In recent years, the ESI Scheme has gained immense popularity among the Indian workers and has helped to reduce poverty and improve the standard of living of many families across the country. The scheme has also helped to reduce the burden on the public exchequer as it is a self-financing scheme.
Today, the ESI Scheme covers over 50 million employees and their families in India and is one of the largest social security schemes in the world.
ESI Full Form
The full form of ESI is the Employee State Insurance Corporation. It is a social security system in India, established by an Act of the Parliament in 1948. The main purpose of ESI is to provide social security benefits to employees through a contributory fund.
The ESI scheme is applicable to all factories and establishments employing 10 or more persons. It provides insurance coverage to employees in case of sickness, maternity, disablement or death due to employment injury. It also provides medical care and cash benefits to the employees and their families. The employers and the employees both contribute to the fund, and the benefits are provided from the accumulated fund.
Benefits of ESI
The benefits provided by the ESI scheme are divided into two categories, namely, cash benefits and medical benefits. The cash benefits include sickness, maternity, disablement and death benefits. The medical benefits include medical care, hospitalization, and diseases and ailments.
The ESI scheme is managed by the Employees State Insurance Corporation, which is headed by a central government official. The state governments are responsible for the implementation of the scheme in their respective states. The scheme is funded by the contributions of employers and employees, and the central government provides additional funds.
The ESI scheme has been a great success in India, providing social security to millions of employees. It has been instrumental in reducing the burden of medical expenses on employees and their families. The scheme has been successful in reducing absenteeism due to illness and providing better quality of life to employees.
The benefits of ESI are far-reaching and can offer a great deal of security to employees and their families. Firstly, ESI provides financial protection to employees in times of need. The scheme provides for cash benefits during periods of sickness and maternity, making it easier for employees to manage financial difficulties during such times.
Secondly, ESI provides access to quality medical care and healthcare services. Employees who are registered with ESI are entitled to free medical care at ESI dispensaries and hospitals, making it easier for them to access quality medical services. The scheme also provides for reimbursements for medical expenses, making it more affordable to access medical care.
Thirdly, ESI provides peace of mind to employees. Knowing that they have access to financial and medical benefits in times of need can provide a sense of security and assurance to employees.
Lastly, ESI helps to ensure that employees are paid wages on time. The scheme requires employers to deposit a certain amount of money in the ESI fund every month, and this money is then used to pay benefits to employees. This helps to ensure that employees always receive their wages on time and in full.
Conclusion
In conclusion, ESI offers numerous benefits to employees in the organized sector. It provides financial security, access to quality medical care, peace of mind, and timely payment of wages. These benefits make ESI a valuable scheme that should be taken advantage of by all employees in the organized sector.
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