It is a comprehensive Social Security Scheme designed to accomplish the task of socially protecting the ’employees’ in the organized sector against the events of sickness, maternity, disablement and death due to employment injury and to provide medical care to the insured employees and their families. The scheme provides full medical care to the employee registered under the scheme during the period of his incapacity for restoration of his health and working capacity. It provides financial assistance to compensate the loss of his/ her wages during the period of his abstention from work due to sickness, maternity and employment injury. The scheme provides medical care to his/her family members also.
The ESI Scheme is administered by a corporate body called the ‘Employees’ State Insurance Corporation’ (ESIC), which has members representing Employers, Employees, the Central Government, State Government, 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 ESI scheme is a self financing scheme. The ESI funds are primarily built out of contribution from employers and employees payable monthly at a fixed percentage of wages paid. The State Governments also contribute1/8th share of the cost of Medical Benefits.
According to the notification issued by the appropriate Government (Central/State) concerned under Section 1(5) of the Act, every establishment employing 10 or more persons attracts ESI coverage.
“ESIC” allows medical treatment to the employees insured and their families. It also protects employees in events of illness, disablement, harm, hurt or death due to employment. Losses of wages during the period of his leave from work are also compensated to the insured employees.
If Gross salary i.e. Basic+ DA+ HRA of any employee is less or equal to Rs. 15,000/- per month, ESI is to be deducted on the rate prescribed and shall be paid to the Corporation on or before 21st day of the following month in which the ESI was deducted.
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|S. No.||Particulars||% OF Deduction/Contribution|
|1||Employees’ Contribution||1.75% of Gross salary|
|2||Employers’ Contribution||4.75% of Gross salary|