Definition:

According to I.L.O, Social security is the protection which

society provides for its members through a series of public
measure, against the economic and social distress that
otherwise would be caused by the substantial stoppage of
earning resulting from :-

sickness
maternity
injury
unemployment
old age and
death.
Purpose of social security
To give individuals and families the confidence that their level of
living and quality of life will not erode by social or economic
eventuality.

To provide medical care and income security against the

consequences of defined contingencies

To facilitate the victims physical and vocational rehabilitation

To prevent or reduce ill health and accidents in the occupations

To protect against unemployment by maintenance and promotion

of job creation

To provide benefit for the maintenance of any children.

Objectives:
COMPENSATION

RESTORATION

PREVENTION
Approaches:
Social assistance:
A method to provide benefits as of right to persons,
usually of small means in amounts sufficient to meet a
minimum standards of living from general revenues of
the state.
Characteristics feature of this is the beneficiaries do not
make any contribution towards various benefits which
are made available to them.
It is a Non-contributory benefits towards the
maintenance of vulnerable groups such as children,
mothers, aged peoples, disabled etc.
Social Insurance

A method to provide benefits as a matter of right for

persons of small earnings, in amounts which combine
the contributions of the beneficiaries with subsidies
from the employer and the state
Characteristics feature of this is the beneficiaries,
employers and the Government make contributions to-
wards the creation of common pool, out of which benefits
are paid to the members in the event of any contingencies.
Suitable where the class of workers to be covered is
sufficiently well organized, legally regulated and
financially stable.
Social Assistance : Social insurance :

A method to provide benefits

A method to provide benefits as a
as of right to persons usually of
matter of right for persons of small
small means in amounts
earnings, in amounts which
sufficient to meet a minimum
combine the contributions of the
standards of living from
beneficiaries with subsidies from
general revenues of the state.
the employer and the state.

Non contributory Contributory

 Cannot be claimed as a Can be claimed as a matter
matter of right (Provided) of right

For the vulnerable groups For the well-organized,

of the community legally regulated, financially
(children, mothers, stable community.
invalids, aged people,
disabled)
Contingencies of Social Security:
Medical Care

Sickness Benefit

Unemployment Benefit

Old Age Benefit

Employment Injury
Benefit

Family Benefit

Maternity Benefit
 History of social security
. FIRST PHASE:
A study on social security (ILO 1984) describes three
stages in its modern evolution according to this view, the
initial response was paternalistic private charity and
poor relief was provided to the indigent, but harsh
conditions and stigma made this form of provision
politically unacceptable
SECOND PHASE::
As a reaction of first phase , in the second phase
insurance schemes were developed based on
compulsory premium that entitled the participants to
pensions and sick pays.
In time these programs were expended to include
wider coverage and contingencies

.THIRD PHASE:
In this phase the concept of prevention and
universality were introduced with the aim of
maintaining and enhancing the quality of life.

(REFERENCE FROM:ILO 1984,p. 17)

Preventive Schemes

Promotional Schemes

Protective Schemes
Preventive Schemes are the Schemes aimed at
risk prevention. In the strategy of social
management of risks, preventive approach
tries to prevent poverty and helps people
under below poverty line to come above
poverty line. Preventive health care,
vaccinations against diseases forms part of
the preventive strategies. Majority of the
schemes are of social assistance in nature.
Promotional social security schemes are mainly of Social
Assistance type, where to guarantee minimum standards of
living to vulnerable groups of population, the
Governments at the State and Center draft schemes
financed from the general revenues of the Government.
These are the strategies of risk mitigation. These
guarantee:
Food and Nutritional Security
Employment security
Health Security
Education Security
Women Security
Food for work
Jawahar Rojgar Yojana
Antyodaya
Rural Landless Labourers Employment Guarantee
Schemes
Programmes of Integrated Rural Development Project
Sakshara Bharath
Integrated Child Development Scheme (ICDS)
Public Distribution System
Reservations for the disabled in services
Special educational institutions for the disabled
persons etc.
The protective social security programmes help the poor in
removing/reducing contingent poverty. In India, the
protective social security programmes have been designed
to address the contingent poverty or the contingencies
defined by the ILO.
Old-age income needs
Survival benefits
Medical need of insured families
Widow and children/dependant economic needs
Maternity benefits
Compensation for loss of employment and
Work injury benefits
Social security schemes for
working class in the
organized sector
 Employees State Insurance (ESI) Act
1948
Employees Provident Fund (EPF) Act
1952
Workmens Compensation Act 1923
Maternity Benefit Act 1961
Payment of Gratuity Act 1972
1. Employees State Insurance (ESI)
Beneficiaries:

Small factories employing 10 or more employees

whether power is used in the process of manufacture or
not.
Shops
Hotel and restaurants
Cinema halls and theatres
Road motor transport establishments
Newspaper establishments
And some private medical and educational institutions
employing 20 or more persons in some state.
This act covers all employees manual ,clerical
,supervisory and technical getting up to Rs.15,000 per
month or above.
Administration:
Administration of ESI scheme is entrusted under an
autonomous body called ESI COOPERATION.
Headed by union minister for labour.
Consists of members representing central and state
government, employers and employees organizations,
medical professionals and parliament.
Contribution :
- Employees : 1.75% of wages.
-Employers : 4.75% of total wage bill.
*employees getting wages below Rs. 70/day*, are exempted
from payment of contributions.

Benefits:
- Full and comprehensive healthcare and medical
benefits for insured workers and their families.

- Payment of the full average wage for 12 weeks for

confinement /miscarriage, or sickness arising out of
pregnancy.
- Payment of funeral expenses in cash on death of
insured person (not exceeding Rs.5000)
 In case of death as a result of employment injury ,the
dependents of the insured person are eligible for periodical
payments. Pensions @ 70 % of the wages is payable

Cash payment ,besides free medical treatment ,in the event

of temporary or permanent disablement as a result of
employment or occupational diseases.(@ 70% of wages)

Sickness benefits ,maximum payable up to 91 days, in any

continuous period of 365 days, the daily rate being about
50% of daily wages.
*Extended sickness benefits:
In addition to 91 days of sickness benefits ,insured
persons suffering from certain long term diseases are
entitled to extent the sickness benefit for a maximum
period of 2 years .
34 such extended sickness benefit diseases are payable
like:
Infectious diseases
Neoplasm
Endocrine disorders
Disorders of nervous system
Disorders of cardiovascular system etc.
The extensive coverage of the scheme:

- 6.79 million workers (2.2% of Indian workers) in

170,000 companies/ organizations.

- 30 million persons (less than 3% of the total

population) as included family members

- Maharashtra, West Bengal and Uttar Pradesh in the

highest numbers of insured persons reaching over 1
million.
Comprehensive medical care

- one-eighth of costs provided through the respective

states
- cash benefits (reimbursements) are administered by
the ESI corporation:
1. - through the schemes own, hospitals and
dispensaries
2. - through reservation of beds in other hospitals
3. - staffed by competent professionals
4. - appreciated by non-regular workers such as causal
& contract workers
 Limitation and difficulties
- level and quality of medical care
- the dual administrative control of the state
government and corporation
- lack of good healthcare infrastructure
- lower enrolment (150,000 additional workers
per year) but higher requirement of setting up
new infrastructure
Rajiv Gandhi shramik kalyan
yojana:
ESI cooperation has launched a new yojana for
workers/ employees covered under ESI scheme.
Unemployment allowance for those who where
rendered unemployed involuntary due to
reattachment or closure of factory or establishment.
Criteria: the employee must have contributed under
the scheme for at least five years .
Benefit: allowance for 6 months in the form of
complete payment.
 2.Employees Provident Fund
(EPF):
-

Provident fund is a scheme by the Government of

India by which:

* A fixed percentage is deducted from the persons

salary and
* A fixed percentage added by the
company /establishment.

This amount is kept in an account, which

accumulates and is then received back after
retirement.
 a family pension and a deposit-linked insurance

retirement pension benefits to the workers and his/her

family

survival benefits in case of death during service [a

maximum of Rs.25,000 is paid]

covering companies employing over 20 workers

 the minimum service for eligibility is 10 years and
pensionable service of 33 years [50% of the last wages
are paid]

permitting withdrawal for purposes of life insurance

policies, house building, medical treatment, marriage,
higher education, etc
 Coverage
- approx 20 million workers (6.4% of the working
population) in about 2,64,000 establishments are
enrolled by the different employment sector:
51% of enrollees in the manufacturing industries
over 20% of enrollees in the mining and quarrying
5.7% of subscribers in agricultural and allied fields
10.4% of subscribers in the unorganised sector

- 42% of the total membership are in the three states of

Maharashtra, Tamil Nadu, and West Bengal
 The existing provisions of Defined Benefit
Pension and GPF would not be available to the
new recruits in the central Government service,
i.e. to the Government servants joining
Government service on or after 1-1-2004.

(from the official site for :ministry of labour)

3.Workmens Compensation
Scheme
- covering workers in factories, mines, plantations,
railways, and other scheduled employments

- providing compensation to workmen or their survivors

in case of injuries, death, and occupational diseases
sustained during employment service

- the compensation amounts is paid to workers

according to the damage :
 In case of death :40% of monthly wage ,multiplied by
relevant factor or Rs. 20,000; whichever is more.

In case of total permanent disablement :50% of monthly

wages or Rs.24,000; whichever is more.

In case of partial disablement the compensation is a % of

that payable in the case of total permanent disablement
and is determined by a qualified medical practitioner.

In case of temporary disablement 25% of the wages can be

paid half a monthly.
LIST OF INJURIES DEEMED TO RESULT IN PERMANENT TOTAL
DISABLEMENT
Percentage of loss of
Description of Injury earning
1.Loss of both hands or amputation at higher
sites

2. Loss of a hand and a foot

3. Double amputation through leg or thigh, or
amputation
through leg or thigh on one side and loss of 100%
other foot
4. Loss of sight to such an extent as to render
the claimant
unable to perform any work for which eye-sight
is essential.
5. Very severe facial disfigurement

6. Absolute deafness
LIST OF INJURIES DEEMED TO RESULT IN PERMANENT PARTIAL
DISABLEMENT
Percentage of loss
Description of Injury of earning
Amputation through shoulder joint 90
Amputation below shoulder with stump 80
less than [20.32 Cms.] from tip of
acromion
Amputation form [20.32 Cms.] from tip 70
of acromion to less than [11.43 Cms.]
below tip of olecranon
Loss of a hand or of the thumb and four
60
fingers of one hand or amputation
from[11.43 Cms.] below tip of colcannon
Loss of thumb 30
 4. Payment of Gratuity

-Gratuity is a lump sum amount that your employer

pays you when you retire or resign from the
organization. An Employee does not contribute any
portion of his salary towards this amount.

-Applicable to various establishments employing over

10 workers

-Eligible to those who have paid a minimum

continuous service of 5 years.
Formula Used :
Gratuity Calculation
In India =
[ (Basic Pay + D.A) x 15 days x No. of years of service ]

26

Where, D.A = Dearness Allowance.

5. Maternity Benefit
Scheme
- providing payment of wages for up to 12 weeks for full-
time
- (ie,6 weeks prior the date of delivery and 6 weeks after)

- covers o.5% of women workers nationwide.

- some states have introduced special schemes for

extending maternity benefit to landless agricultural
workers.
 In case of miscarriage or MTP on production of proof ,
a woman is entitled to leave with wages for a period of
6 weeks immediately after the day of miscarriage or
abortion.

Provision of leave with wages for tubectomy operation

for a period of 2 weeks .

In case of any diseases or any complication arising out

of pregnancy , the lady is allowed to take leave with
full wages for 1 month ,provided she submits proper
documents related.
Some other benefits:
Central Government Health Scheme
(CGHS)
Established on 1-7-1954 with the objectives of providing
comprehensive medical care facilities to the central
Government employees and their family members and to
avoid cumbersome system of medical reimbursement

Facilities provided under CGHS through: Dispensaries, poly

clinics and Government / recognized hospitals.
National Social Assistance Programme

National Old Age Pension Scheme

since 1995
National Maternity Benefit Scheme
since 1996
National Family Benefit Scheme
 1.National Old Age Pension
Scheme
- Granting monthly pensions to the aged over
65 years, those without subsistence income
or family support.
- paid by the central government under the
NSAP (national social assistance
progamme)Pension amount
The pension amount, as of Union Budget
2012-13 is Rs.200 per month per person
from 60 79 years and Rs.500 per month
per person for those 80 years and above and
states are supposed to contribute an equal
amount to the scheme.
- -widows are entitled to a pension for one year; during
the period, skill development for self-employment is
encouraged

- physically disabled are eligible for the monthly pension

if above the age of 45 years, along with receiving free
education, lodging, and boarding facilities in state-
run institutions
 Limitations

- the amount of pension is considered too low to

ensure the minimum subsistence level

- the number of beneficiaries is restricted by state

budgetary limitations and central guidelines
 2.National Maternity
Benefit Scheme

- women in all households below the poverty line are

eligible for maternity benefits, cashing an amount of
Rs.500 for the first and second deliveries respectively

- Stipulating a minimum age of 19 years [around 3% of

babies born of girls aged between 15-19 years]

- the maternity assistance amount in Chhattisgarh is

Rs.500 & in Andhra Pradesh is Rs.900, payable in four
installments,
3.National Family Benefit Scheme

Funding Pattern : 100% funded by the Central

government

- given in the form of lump sum family benefit for

households below the poverty line on the death of the
primary breadwinner in the bereaved family. The
amount of benefit is Rs.10000/- in case of death of
primary breadwinner due to natural or accidental
causes.
Social insurance schemes:
Government Sponsored Socially Oriented Insurance
Schemes
Aam Aadmi Bima Yojana(AABY)
Janashree Bima Yojana
Shiksha Sahayog Yojana (SSY)
Micro-Insurance Products
Varishtha Pension Bima Yojana (VPBY)
Universal Health Insurance Scheme (UHIS)
National Agricultural Insurance Scheme (NAIS)
Pilot Modified National Agricultural Insurance Scheme
(MNAIS)
Pilot Weather based Crop Insurance Scheme (WBCIS)
Shiksha Sahayog Yojana (SSY)
The scheme was launched on 31st December, 2001.

Scholarship as a free add-on benefit is provided under both

Janashree Bima Yojana and Aam Admi Bima Yojana to
maximum of two children of the beneficiary studying
between 9th to 12th standard (including ITI courses) @ Rs.
100 per month for each child payable half yearly on 1st July
and 1st January, every year.

The benefit is without any additional premium.

Fund has been set up by Govt. of India called "Aam Admi

Bima Yojana Scholarship Fund. Fund is maintained by LIC
of India.
 Micro-Insurance Products
Jeevan Madhur" a simple savings related life insurance plan for
low income persons was launched in 2006. On surviving to the
date of maturity, sum assured is paid alongwith vested bonus if
any.

On death of the policy holder, death benefit amount equal to the

total premiums payable during the entire term of the policy will
be paid alongwith vested bonus if any.

Jeevan Mangal", LIC's second Micro Insurance product, was

launched in 2009. It is a term insurance plan with return of
premiums paid on maturity, provided the policy is in force. On
death during the term of the policy, the sum assured under the
basic plan is payable, provided the policy is in force.
Varishtha Pension Bima Yojana (VPBY)

VPBY meant for senior citizens aged 55 years and

above was launched on 14.7.2003. Under the scheme
the pensioner gets an effective yield of 9% per annum
on the investment.
Universal Health Insurance Scheme
(UHIS)
The four public sector general insurance companies have
been implementing Universal Health Insurance Scheme for
improving the access of health care to poor families.

provides for reimbursement of medical expenses upto

Rs.30,000/- towards hospitalization floated amongst the
entire family, death cover due to an accident @ Rs.25,000/-
to the earning head of the family.

compensation due to loss of earning of the earning

member @ Rs.50/- per day upto maximum of 15 days
 The premium subsidy has been enhanced from Rs.100
to Rs.200 for an individual, Rs.300 for a family of five
and Rs.400 for a family of seven, without any reduction
in benefits.
National Agricultural Insurance Schme
(NAIS)
The Government of India introduced the scheme from Rabi
1999-2000 season to protect the farmers against losses suffered
by them due to crop failure on account of natural calamities.

implemented by Agriculture Insurance Company of India

(AICIL). The scheme is available to all the farmers, loanee and
non-loanee, irrespective of size of their holding.

covers all food crops (cereals, millets and pulses) and oil seeds
and Annual commercial/ horticultural crops

10% subsidy on premium is available to small & marginal

farmers. NAIS is presently being implemented in 24 States and 2
Union Territories except in States of Punjab & Arunachal
Pradesh.
unorganised sector

organised sector
Unorganised sector worker:
Means a person who works for wages or income:
directly or through an agency or contractor; or who
works on his own/her own account or is self employed
; in any place of work including his/her home ,field or
any public space and who is not availing the benefits
under ESIC ACT and P.F ACT
 Parliament of India has enacted unorganised sector
workers social security act 2005.

National social security board for unorganised sector

have been constituted by the central government to
exercise the powers confined on and to perform the
functions assigned to. Headed by union minister for
lab our and employment.
 Programmes:
Indira gandhi national old age pension scheme
National family benefit scheme.
Jannani suraksha yojana
Handloom weavers comprehensive welfare scheme.
Handicraft artisans comprehensive welfare scheme.
Pension to master craft persons
National scheme for welfare of fisherman and training and
extension
Janshree bima yojana
Aam aadmi bima yojana.
Rashtriya swastiya bima yojana.
 Janani suraksha yojana
It was launched on 12th April 2005.

Objectives of this scheme were reducing maternal mortality and

infant mortality through encour-aging delivery at health institu-
tions & focusing at institutional care among women in below
pov-erty line families.

100 percent centrally spon-sored scheme & it integrates the

benefit of cash assistance with in-stitutional care during ante
natal, natal and immediate post-partum care.
Key problems

Social security policies assumes an homogeneity

among all the unorganised workers.
But the sector is heterogeneous in terms of:
-Social security needs
-Ability to contribute
-Membership and participation
We can divide the unorganised sector workers into two
categories:
Ultra poor
Inability to meet basic need.
Need promotional
upliftment.
Find difficult to contribute to
social security due to limited
and insecure livelihood.
Poor
Fulfilled basic needs .
Protective social security
schemes
Ability to contribute towards
social security is higher.
 Social security :an integral element for poverty alleviation
among ultra poor.
Improving service delivery system to provide basic needs
Governance of these institutions needs to be improved in
terms of participation and accountability
New institutions like SELF HELP GROUPS should be
formed.
Implementation of subsidies to provide social protection.
Protective security for Poor

What they need is inclusive, participatory ,

transparent ,and effective social security schemes so
that they do not slip back into poverty.
GOVT should plan to increase the employment
opportunities for people of this strata.
Conclusions
About 13% of the working population are covered by the
statutory social protection :

- Some 19.5 million government and public sector workers

- Some 21 million private sector workers

These major social security laws do not distinguish between

organized and unorganised sectors:

- very few informal economy workers are covered under the

statutory schemes

- because there are many difficulties in establishing

workers-employer relationship and an effective system for
the collection of contribution
 The statutes explicitly exclude groups of workers such as
those working outside the scheduled industries and
establishments
those in smaller enterprises
the very substantial category of the self-employed
(comprising 54% of the workforce)

Lack of awareness and unity among the informal economy

workers to enforce the laws