The ESI Act provides for the provision of benefits to employees in case of sickness, maternity and employment injury. Under the act, employees receive medical relief, cash benefits, maternity benefits, pension to dependents of deceased workers and compensation for fatal or other injuries and diseases. Payments are made through a contributory fund.
Applicability
The ESI Act extends to whole of India.
It applies to all factories including Government factories (excluding seasonal factories), which employ 10 or more employees and carry on a manufacturing process with the aid of power (20 employees where manufacturing process is carried out without the aid of power).
The act can also be extended to shops and establishments. Generally, shops and establishments employing more than 20 employees as defined by the act, are covered by the Act.
The act does not apply to Mines covered under the Mines Act, Indian Naval, Military or Air Forces, Railways running sheds and Government Factories or establishments whose employees are in receipt of benefits similar or superior to those provided under the Act.
All employees including casual, temporary or contract employees drawing wages < Rs 6500 per month are covered. Apprentices are not covered.
A factory or establishment to which this Act applies, shall continue to be governed by its provisions even if the number of workers employed falls below the specified limit or the manufacturing process therein ceases to be carried on with the aid of power subsequently.
Where a workman is covered under the ESI scheme,
(a) compensation under the Workmens Compensation Act cannot be claimed in
respect of employment injury.
(b) No benefits can be claimed under the Maternity Benefits Act.
