ESI & PF

THE EMPLOYEE'S STATE INSURANCE ACT, 1948
For a quite long time it was under the consideration of the Government of India to introduce a scheme of Health Insurance for industrial workers. The necessity for such a scheme had become more urgent because of the conditions brought about by war. In order to provide for certain benefits to employees in case of sickness, maternity and employment injury the Employees' State Insurance Bill was introduced in the Legislature. The Bill was referred to the Select Committee for its recommendation. After incorporating the recommendations of the Select Committee it was re-introduced in the Legislature.
 
STATEMENT OF OBJECTS AND REASONS
The introduction of a scheme of Health Insurance for Industrial Workers has been under the consideration of the Government of India for a long time. The necessity for such a scheme has become more urgent in view of the conditions brought about by war. The scheme envisaged is one of compulsory State Insurance providing for certain benefits in the event of sickness, maternity and employment injury to workmen employed in or in connection with the work in factories other than seasonal factories.

A scheme of this nature has to be planned on an all-India basis and administered uniformly throughout the country. With this object, the administration of the scheme is proposed to be entrusted to a Corporation constituted by central legislation.

The functions of the corporation will be performed by a Central Board constituted of representatives of Central and Provincial Government, and of employers, workers and the medical profession. The Board will also include certain members elected by the Central Legislative Assembly. A standing Committee of the Board will act as the Executive of the Board, and a Medical Benefit Council will also be set up to advice on matters relating to the administration of medical benefit.

The insurance fund will be mainly derived from contribution from employers and workman. The contributions payable in respect of each workman will be based on his average wages and will be payable in the first instance by the employer. The employer will be entitled to recover the workman's share from the wages of the workman concerned. Workman whose earnings do not exceed 10 annas a day will be totally exempt from payment of any share of the contribution, the entire contribution on account of such workman being met by employer. Provision has been made for the preparation of proper budgets and the audit of accounts.
 
The insured workman will be entitled to the following benefits :
a) Sickness Cash Benefit : A workman, if certified sick and incapable of working will receive for a period not exceeding 8 weeks in any continuous 12 monthly period a cash allowance equal approximately to half average daily wages during previous six months. He will also be entitled to receive medical care and treatment at such hospitals, dispensaries or other institutions to which the factory in which he is employed may be allotted.

b) Maternity Benefit : Women workers will be entitled to receive a maternity benefit at 12 anns a day for 12 weeks. They will also be entitled to medical aid at the aforesaid medical institution.

c) Disablement and Dependent's Benefit : A workman disabled by employment injury will receive for the period of disablement of life depending on whether the disablement is temporary or full and permanent, as the case may be a monthly pension equivalent to half his average wages during the previous twelve months, subject to a maximum and minimum. Where disablement is partial, the pension will be proportionately reduced. In case of death resulting from employment injury the pension will be payable to the widow or widow's minor sons and minor and unmarried daughters or in case there are no widow and legitimate children, to other dependents of the deceased workman. The workman will also be entitled to medical care treatment.
 
Medical care and treatment to insured workman will be provided by Provincial Government at such hospitals, dispensaries and other institutions as may be prescribed for the purpose. The cost of the medical benefit will be shared between the Provincial Government and the Corporation in such proportions as may be agreed upon between them. In case the average incidence of sickness cash benefit in any Province is in excess of the all-India average, Provincial Government will also bear such share of the cost of the excess incidence as may be agreed upon between it and the Corporation.

Workmen's State Insurance Courts will be set up to decided disputes and adjudicate on claims. The cost of the tribunal will be paid by the insurance fund.

Central Government will make rules on matters relating to the administration of the Corporation, such as nomination and election of members of the Board Standing Committee, Medical Benefit Council, powers and duties of the principal officers, raising of loans, investment of funds, accounts to be maintained by the corporation, their audit and publication, Provincial Government will make rules on matter relating to the Workmen's Insurance Courts to be set up under the Act, establishment of hospitals, dispensaries, medical institutions, etc. and the scale of medical benefit to be provided to insured persons. The Board will make regulations on matters relating to the working of the scheme, e.g. collection of contributions, payment of benefits, returns and other particulars to be submitted by employers in respect of workman employed by them, the conditions to be observed by insured persons, in receipt of benefit, etc.
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