BBBBUILDERSUILDERSUILDERSUILDERS’’’’ AAAASSOCIATION OF SSOCIATION OF SSOCIATION OF SSOCIATION OF IIIINDIANDIANDIANDIA (All-India Association of Engineering Construction Contractors and Builders)

G-1/G-20, 7th floor, Commerce Centre, J. Dadajee Road, Tardeo, Mumbai 400034 Tel : (91-22) 23520507, 23514134, 23514802 Fax: 23521328

Web Site : www.baionline.in E-mail : baihq.mumbai@gmail.com

Ref: 227/A/2015-16 dated August 12, 2015 To: All Managing Committee and General Council Members of BAI All Office Bearers of BAI Centres Dear Sirs,

Sub: Applicability of Employees’ State Insurance Act to the Construction Industry. With reference to the above, please be informed that, Employees’ State Insurance Corporation (ESIC) has now started covering Construction Workers also in Employees’ State Insurance (ESI) Scheme, with effect from 1st August 2015. We hereby send you the following for your kind information and doing the needful :- 1. Advertisement of Employees’ State Insurance Department.

2. Circular No.P-12/11/11/60/2010-Rev.II dated 31st July 2015 received from Employees’ State Insurance Department.

3. Notice to Employers dated 31st July 2015 received from Employees’ State Insurance Department.

4. All about Employees’ State Insurance (ESIC) Act, 1948.

5. Press Release dated 23rd July 2015 issued by ESIC Department.

6. A comparative statement of ESI Act, 1948 with Building and Other Construction Workers’ (Regulation and Employment and Conditions of Service) Act, 1996.

You are requested to kindly advise BAI Headquarter’s line of action on the above matter. Thanking you,

Yours faithfully,

Sd/- RAJU JOHN

Executive Secretary Builders’ Association of India

Delhi Office: D1/203, Aashirwad Complex, Green Park Main, New Delhi 110 016 � 26568763 E-mail:baidelhi16@gmail.com

MOST URGENT

All about Employee State Insurance (ESIC) Act, 1948

Wage Limit Rs. 15,000 for coverage of an employee under the ESIC Act:-

The Government of India through notification in the Official Gazette has

amended the Employees' State Insurance (Central) Rules, 1950. Accordingly,

as per rule 50, the wage limit for coverage of an employee under Employees

State Insurance Act Rs. 15,000 with effect from 1u May 2010.

The Employees State Insurance Act" ESI Act for short, was enacted by the

Government of India in 1948. The major objective of the Act was to provide

certain benefits to employees in case of sickness, maternity and injury (during

employment) and for providing other benefits in relation to the main

objectives.

The Employee State Insurance Act, 1948

The Government of India through notification in the Official Gazette has

amended the Employees' State Insurance (Central) Rules, 1950. Accordingly, as

per rule 50, the wage limit for coverage of an employee under Employees State

Insurance Act has been enhanced from Rs. 10,000 to Rs. 15,000 with effect from I

May 2010.

Applicability

The ESI Act, 1948 in the first applies to:

. Factories, establishments viz Hotels, Restaurants

. Cinemas & shop etc., employing 20 or more persons for wages.

. Form 1.8.2015 ruction works are also covered, as per the notification dated :

31.07.2015 (Notification enclosed)

The Act contains an enabling provision under which Appropriate Government

is empowered to extend the provision of the ESI Act, 1948 to other classes of

establishments.

. Industrial

. Commercial

. Agricultural or otherwise

Under these provisions the State Governments have extended the provisions

of the ESI Act to the following classes of establishments.

. Shops

. Hotels & Restaurants

. Cinemas including preview Theaters

. Road Motor Transport Undertaking

. News Paper Establishments

Wage Ceiling

Employees of covered units and establishments drawing wages upto Rs.

15,000 per month come under the purview of the ESI Act 1948 for multi

dimensional social security benefits.

Contribution

ESI scheme is financed by contribution raised from employees covered under

this scheme and their employers as a fixed percentage of wages. Rates of

contribution are as follows:

. Employees contribution L.75% of wages ( Employees earning up to Rs. 50

per day are exempted from payment of their contribution)

. Employer's contribution 4.75% of wages.

Social Security Benefits

Various benefits that the insured employees and their dependents are entitled

to are

as follows

. Medical Benefits

. Sickness Benefits

. Maternity Benefits

. Disablement Beneflts

. Dependent Benefits

. Other Benefits (like funeral expenses, vocational rehabilitations, free supply

of physical aids etc).

Safeguard for Insured Employees:

. Right to receive payment of any benefit under the Act are not transferable.

. Employer shall not dismiss, discharge or reduce the wages or otherwise

punish a covered employee during the period he/she is in receipt of Sickness

Benefit or Maternity Benefit etc.

. By reason of his liability to pay his share of contribution under the ESI Act, no

employer shall directly or indirectly reduce the wages of a covered

employee.

. Right to register their grievances / complaints at any level for immediate

redressel.

. Right to approach ESI Court against any action/decision of the Medical Board

etc

. Cash Benefits payable under the Act are not liable to attachment or sale in

execution of any decree or order of any court

Duties of Employer

. An employer shall apply in Form-0l for coverage under the ESI Act, within 15

days after the Act becomes applicable to a factory or establishment.

. Obtain - Employers code No (I7-digit)

. The employer shall submit Declaration Form in respect of all coverable

employees in the unit.

. The employer shall deposit both employees' and employers' contribution as

per specified rates within 2l days of the following month.

. The Employer shall maintain all such records and registers as are required

under the Act and produce them for verification / inspection before the

authorised officers of the Corporation.

. The employer shall submit half-yearly Return of Contributions (RC) by 12th

May / 11th November every year with all columns properly filled.

. The employer will report any change in business activity, address, ownership

or the management to ESIC authorities forthwith.

. An employer will also ascertain the liability towards ESI dues, while taking

over the ownership of a factory/establishment through purchase, gift, lease,

licence or otherwise as the new owner is liable to discharge past liabilities.

. An employer will also ascertain the liability towards ESI dues, while taking

over the ownership of a factory / establishment through purchase, gift, lease,

licence or otherwise as the new owner is liable to discharge past liabilities.

Headquarters Office Employees’ State Insurance Corporation

(ISO 9001-2008 certified) Panchdeep Bhawan, CIG Road, New Delhi-110002

No.E-13/12/09/2015-PR Dated: 23rd July, 2015

Press Release • ESIC goes for extending the coverage aspect of ESI Scheme in new States and

geographical areas. • Construction site workers also to get ESI coverage.

ESIC has taken steps for implementation of the programmes listed in “ESIC’s 2nd

Generation Reform Agenda i.e. ESIC 2.0” within the stipulated time frame. ESIC 2.0 has been launched by Shri Narender Modi, Hon’ble Prime Minister on 20.7.2015. In continuation to taking the Reforms Agenda further, ESIC will be extending its coverage for bringing more and more workers under the Social Security umbrella of ESI Scheme.

The ESI Scheme has been implemented in 31 States/Union Territories till date as of now. Now, ESIC is taking steps to bring Arunachal Pradesh, Mizoram, Manipur and Andaman & Nicobar Island (remaining States/UT) under the coverage of ESI Scheme so that the workers of organized sector of these States/UT are provided the social security benefits. The timeline

scheduled for this purpose has been fixed 31st December, 2015.

The ESI Scheme is being implemented geographical area wise, in a phased manner, keeping industrial/commercial clusters on priority. As of now, ESI Scheme is covered in 830 centres (major industrial/commercial clusters) involing 2.03 crores IPs. Although these centres belong to 393 districts of the country, but whole areas of these districts are not covered under ESI

Scheme. ESIC is to cover whole of these 393 districts by 31st March, 2016.

ESIC is also now going to cover the Construction site Workers under the ESI Scheme thereby enabling them to avail benefits of complete medical care (from primary to tertiary medical care), as well as a range of cash benefits in times of exigencies of employment injury, death, disablement, maternity and unemployment. Construction activity has been covered by the ESIC under Sec. 1(5) treating them as establishment. ESIC - A Complete Social Security Organization It may be noted that the Employees’ State Insurance Corporation is a complete and

pioneer Social Security Organization. The additional covered workers as well as already covered workers of ESIC get the following benefits being provided by the ESI Scheme:-

1. The Sickness Benefit is paid to the insured person at the rate of 70% of the average daily wages up to 91 days in two consecutive Benefit periods.

2. The extended sickness benefit is admissible at the rate of 80% the average daily wages for 124 days during a period of two years, extendable up to two years on medical advice.

3. Under the disablement benefit, the insured person who becomes disabled due to employment injury is paid 90% of the average daily wages as long as temporary disablement lasts. For permanent or total disablement, 90 % of the average daily wages is paid for whole life and for permanent partial disablement; the Insured Person is paid proportionate to the loss of earning capacity as determined by the medical board.

4. Dependants’ benefit is paid at the rate of 90 % of the average daily wages sharable in fixed proportion among all dependents if the insured person dies of death due to employment injury. This is payable to the widow for life or until her re-marriage and also to the dependent children till the age of 25 years and also to the dependent parents, subject to conditions. In an endeavour to reach out to the beneficiaries and make the system more customer friendly, long-term benefits such as Permanent Disablement and Dependants Benefits are being credited to the bank account of the beneficiaries through ECS System.

5. The maternity benefit is paid at the rate of 100% of the average daily wages up to 12 weeks in case of confinement, up to 6 weeks in case of miscarriage. This can be extended by one month on medical advice in case of sickness arising out of pregnancy, confinement and miscarriage. The total Expenditure incurred during 2013-14 on cash benefit payments is Rs. 598.69 crores from which one can assess the huge support extended by ESIC to its IPs at the time of distress, which otherwise should have put extra burden on the low income bracket of the workforce of the country

6. One of the biggest benefits extended by ESIC is Medical Benefit which provides ‘Reasonable medical Care’ (from primary OPD services, In-patient secondary services to Super Specialty Services) for self and family from day one of entering insurable employment which continues till the insured person remains in insurable employment. Treatment is provided through Allopathy and AYUSH system of medicines. ESIC Dispensaries and Hospitals are providing the necessary medical treatment. Super speciality treatment is provided through in –house super speciality facilities available in some of ESI Hospital or ESI-PGIMSRs or through large number of advance medical institutions on referral basis through more than 1000 tie-up hospitals across the Country. In such cases, ESIC makes direct payment to the hospitals without putting any financial burden on the patient or his family.

7. Medical Benefit is also extended to the widow/ spouse of the deceased/ retired/ superannuated Insured Persons as well as to the widow/ spouses of Insured Persons who ceases to be in an insurable employment on account of permanent disablement, and also to the widows of Insured Persons who are in receipt of Dependant’s Benefit.

8. Other Benefits include confinement expenses for an Insured Woman or an IP in respect of his wife in case confinement occurs at a place where necessary medical facilities under ESI Schemes are not available, for which Rs. 5000/ is paid up to two confidents only.

9. Rs. 10,000/- is paid as funeral expenses in case of death of an insured person. 10. Vocational training in case of physical disablement due to employment injury for

which the actual fee charged or Rs. 123/- per day, whichever is higher is paid as long as the vocational training lasts.

11. Un-employment Allowance under RGSKY is payable in case of involuntary loss

of employment due to closure of factory, retrenchment or permanent invalidity due to non- employment injury and contribution for three years prior to the loss of employment, 50 % the average daily wages is payable for a maximum period of twelve months during life time. Under RGSKY, in case of involuntary loss of employment, skill up gradation training is provided for duration of maximum 6 months, so that the IP can enhance his skill and opt for other jobs.

12. In order to encourage employment of disabled persons, the employers’ share of contribution in respect of such disabled employees is paid by the Central Government for initial three years. Permanently disabled persons working in factories and establishments covered under ESI Act and drawing wages up to Rs. 25,000/- per month have been brought under the scheme w.e.f.1.4.2008.

ESI Scheme is a labour welfare scheme for providing social security benefits including reasonable health-care.

Comparative benefits of Employees State Insurance Act, and Building and Other Construction Workers’

(Regulation and Employment and Condition of Service) Act, 1996.

Employees State Insurance Act, 1948

Building and Other Construction Workers’ (Regulation and Employment and Condition of Service) Act, 1996.

ESIC -A Complete Social Security Organization It may be noted that the Employees’ State Insurance Corporation is a complete and pioneer Social Security Organization. The additional covered workers as well as already covered workers of ESIC get the following benefits being provided by the ESI Scheme:- 1. The Sickness Benefit is paid to the insured person at the rate of 70% of the average daily wages up to 91 days in two consecutive Benefit periods.

2. The extended sickness benefit is admissible at the rate of 80% the average daily wages for 124 days during a period of two years, extendable up to two years on medical advice. 3. Under the disablement benefit, the insured person who becomes disabled due to employment injury is paid 90% of the average daily wages as long as temporary disablement lasts. For permanent or total disablement, 90 % of the average daily wages is paid for whole life and for permanent partial disablement; the Insured Person is paid proportionate to the loss of earning capacity as determined by the medical board. 4. Dependents’ benefit is paid at the rate of 90% of the average daily wages sharable in fixed proportion among all dependents if the insured person dies of death due to employment injury. This is payable to the widow

a) Provide immediate assistance to a beneficiary

in case of accident;

b) Make payment of pension to the beneficiaries who have completed the age of sixty years;

c) Sanction loans and advances to a beneficiary for construction of a house not exceeding such amount and on such terms and conditions as may be prescribed;

d) Pay such amount in connection with premia for Group Insurance Scheme of the beneficiaries as it may deem fit;

e) Give such financial assistance for the education of children of the beneficiaries as may be prescribed;

f) Meet such medical expenses for treatment of major ailments of a beneficiary or, such dependent, as may be prescribed;

g) Make payment of maternity benefit to the female beneficiaries; and

h) Make provision and improvement of such other welfare measures and facilities as may be prescribed.

for li fe or until her re-marriage and also to the dependent children till the age of 25 years and also to the dependent parents, subject to conditions. In an endeavour to reach out to the beneficiaries and make the system more customer friendly, long-term benefits such as Permanent Disablement and Dependents Benefits are being credited to the bank account of the beneficiaries through ECS System. 5. The Maternity benefit is paid at the rate of 100% of the average daily wages up to 12 weeks in case of confinement, up to 6 weeks in case of miscarriage. This can be extended by one month on medical advice in case of sickness arising out of pregnancy, confinement and miscarriage. 6. Medical Benefit which provides ‘Reasonable medical Care’ (from primary OPD services, In-patient secondary services to Super Specialty Services) for self and family from day one of entering insurable employment which continues till the insured person remains in insurable employment. Treatment is provided through Allopathy and AYUSH system of medicines. ESIC Dispensaries and Hospitals are providing the necessary medical treatment. 7. Medical Benefit is also extended to the widow/ spouse of the deceased/ retired/ superannuated Insured Persons as well as to the widow/ spouses of Insured Persons who ceases to be in an insurable employment on account of permanent disablement, and also to the widows of Insured Persons who are in receipt of Dependent’s Benefit. 8. Other Benefits include confinement expenses for an Insured Woman or an IP in respect of his wife in case confinement occurs at a place where necessary medical facilities under ESI Schemes are not available, for which Rs. 5000/ is paid up to two confidents only.

9. Rs. 10,000/- is paid as Funeral expenses in case of death of an insured person.

10. Vocational training in case of physical disablement due to employment injury for which the actual fee charged or Rs. 123/- per day, whichever is higher is paid as long as the vocational training lasts.

11. Un-employment Allowance under RGSKY is payable in case of involuntary loss of employment due to closure of factory, retrenchment or permanent invalidity due to non- employment injury and contribution for three years prior to the loss of employment, 50 % the average daily wages is payable for a maximum period of twelve months during life time. Under RGSKY, in case of involuntary loss of

employment, skill upgradation training is provided for duration of maximum 6 months, so that the IP can enhance his skill and opt for other jobs.

12. In order to encourage employment of disabled persons, the employers’ share of contribution in respect of such disabled employees is paid by the Central Government for initial three years. Permanently disabled persons working in factories and establishments covered under ESI Act and drawing wages up to Rs. 25,000/- per month have been brought under the scheme w.e.f.1.4.2008.