SOCIAL SECURITY LEGISLATIONS

THE MATERNITY BENEFIT ACT, 1961

The Act extends to the whole of India except Jammu & Kashmir Applies to every factory, shop or establishment Woman entitled to maternity benefit not withstanding the application of the Employees State Insurance Act, 1948

Employer to ensure
No woman works during the six weeks immediately following the day of her delivery or her miscarriage No woman does any arduous work during the period of ten weeks from the expected date of delivery Not to discharge or dismiss a woman during her pregnancy
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Eligibility

Work of 160 days in the 12 months immediately preceding the date of delivery. Leave days & lay offs taken as worked.

Benefit
12 weeks leave of which not more than 6

weeks shall precede the date of her expected delivery The benefit to be paid @ average rate of wages for the three months preceding her maternity leave In case of miscarriage, 6 weeks leave with pay at the same rate as applicable to maternity benefit.
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THE PAYMENT OF GRATUITY ACT, 1972

The Kerala Industrial Employees Payment of Gratuity Act, 1970, followed by the West Bengal Employees Payment of Compulsory Gratuity Act, 1971 and the intention of the other States to have similar Acts in their respective states necessitated the Central Act so as to avoid different treatment to employees of establishments having branches in more than one states who are subject to transfer from one state to another.
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The Payment of Gratuity Act, 1972 extends to the whole of India.

Applies to every factory, mine, plantation and other establishment wherein 10 or more workers are employed.

Gratuity is in the nature of a retirement benefit payable to an employee for a long and meritorious service.

It is not paid to an employee gratuitously or merely as a matter of boon. It is paid for the service rendered by him to the employer (Delhi Cloth and General Mills Co; Ltd Vs The Workmen) Then why it should necessarily be denied to him when an employee is dismissed for misconduct at a latter stage of service ???
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Gratuity is payable to an employee on termination of his employment after he has rendered continuous service for not less than five years
on his superannuation on his resignation

on his death or disablement due to employment

injury or disease
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News paper employees

The Working Journalists and Other Newspaper Employees (Conditions of service) and Miscellaneous Provisions Act, 1955, provides for payment of gratuity. As such, three years of continuous service is required for eligibility for Gratuity.
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The payment of gratuity shall be forfeited

to

the extent of the damage or loss caused by the employee to the property of the employer where the service of the employee is terminated due to misconduct

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Rate of gratuity
15 days wages for every completed year of service Rates applicable to Working Journalists depends upon the service of the employee as provided in the Working Journalists and Other Newspaper Employees (Conditions of service) and Miscellaneous Provisions Act, 1955
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The average pay of the monthly rated employee shall be taken by dividing the monthly salary/ wages by 26 and not by 30

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Piece rate workers and Seasonal establishments

For piece rated workers, average of the three months wages immediately preceding the day of leaving shall be taken as average rate of wage An employee in a seasonal establishment shall be paid @ seven days wages for each season

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Salary ceiling
The

Amendment Act of 1994 removed the salary ceiling of an employee, but the maximum gratuity payable shall be Rs 3.5 lakh.
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In order to be eligible for gratuity, employee should have at least five continuous years of service with the employer
An employee is in service in a calendar year provided he has worked for
190 days in case employee is employed below the ground and 240 days in any other case.
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Continuous service (contd.) The days he/she has been

laid off under an agreement or under the ID Act or as

permitted by the Standing Orders on leave with pay absent due to temporary disablement due to employment injury on maternity leave

shall be taken as worked for the calculation of 190/240 days.

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For seasonal employment 75% attendance during a season shall constitute service in a year
An employee who has worked for 4 years 11 months and 10 days not eligible for gratuity as decided in P. Raghavalu and Sons Vs Additional Labour Court, Andhra Pradesh, as the qualifying phrases part thereof in excess of six months shall be taken only for calculation of gratuity and not for determining the eligibility of gratuity.

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THE WORKMENS COMPENSATION ACT, 1923

The Act provides for payment of compensation to the worker injured during the course of employment or contracted by any occupational disease peculiar to that employment Act extends to the whole of India.

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The amount of compensation

for accidents resulting in death, an amount equal to fifty per cent of the monthly wages of the deceased workman multiplied by the relevant factor; or an amount of eighty thousand rupees, whichever is more * for permanent total disablement, an amount equal to sixty per cent of the monthly wages of the injured workman multiplied by the relevant factor, or an amount of ninety thousand rupees, whichever is more. 20

The maximum compensation as per W.C. Amendment Act 2000

Fatal Injury - Rs.4,57,080 Permanent Total Disablement Rs.5,48,496 Permanent Partial Disablement According to incapacity caused Temporary Disablement - Rs. 2000 per month upto a period of 5 years
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Workmens compensation Act, 1923

The Workmens Compensation Act, aims to provide workmen and/or their dependents some relief in case of accidents arising out of and in the course of employment and causing either death or disablement of workmen. It provides for payment by certain classes of employers to their workmen compensation for injury by accident.
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Employers liability
The employer of any establishment covered under this Act, is required to compensate an employee :

Who has suffered an accident arising out of and in the course of his employment, resulting into (i) death, (ii) permanent total disablement, (iii) permanent partial disablement, or (iv) temporary disablement whether total or partial, or Who has contracted an occupational disease
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THE EMPLOYER SHALL NOT BE LIABLE

In respect of any injury which does not result in the total or partial disablement of the workmen for a period exceeding three days;
In respect of any injury not resulting in death, caused by an accident which is directly attributable tothe workmen having been at the time thereof under the influence or drugs, or the willful disobedience of the workman to an order expressly given, or to a rule expressly framed, for the purpose of securing the safety of workmen
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ESI Corporation and Workmen compensation

The liability of payment of compensation shifted from the employer to the Employees State Insurance Corporation

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EMPLOYEES STATE INSURANCE ACT, 1948

Act extends to the whole of India, However The ESI Scheme is being implemented area-wise by stages. The Scheme has already been implemented in different areas in all States/Union Territories except Nagaland, Manipur, Tripura, Sikkim, Arunachal Pradesh and Mizoram and UTs of Delhi, Chandigarh and Pondicherry

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* Applies to factories and establishments functioning in the notified area and consisting of 10 or more employees. * Provides for health care and cash benefits in cases of sickness, maternity and employment injury. * The Act absolved the employers of their obligations under the Maternity Benefit Act, 1961 and Workmens Compensation Act 1923.
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Applicability of the ESI Act

Employees covered

All employees drawing salary of Rs 10,000 or less are covered (w.e.f 1-10-2006)

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Contribution
Employees contribution . 1.75% of wages Employers contribution. 4.75 % of wages Employees receiving a daily average wage upto Rs.70/-(w.e.f 1-8-07) are exempted from payment of contribution. Employers will however contribute their own share in respect of these employees. pay contribution within 21 days.

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 There are two contribution periods each of six months duration and two corresponding benefit periods also of six months duration as under
Contribution period 1st April to 30th Sept. Corresponding Benefit period 1st January of the following year to 30th June 1st July to 31st December of the year following

Contribution Period and Benefit Period

1st Oct. to 31st March

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ESI Benefits
1.
2.

3.

4.

Periodical payment in case of sickness of the insured person, (sickness benefit) Periodical payment loan insured woman in case of confinement or miscarriage or sickness arising out of pregnancy, premature birth of child (maternity benefit) Periodical payment to an insured person suffering form disablement as a result of an employment injury (disablement benefit) Periodical payment to dependents of an insured person who dies as a result of an employment injury (dependants benefit)
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5. Medical treatment for and attendance on insured person (medical benefit); and 6.Payment for expenditure on the funeral of the insured person (funeral expenses) Here employment injury includes occupational diseases, and disablement may either be temporary or permanent, whether total or partial.
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Employer to maintain and file the following books and returns.

1. Form 7 (Register of Employees showing the details of Gross wages, ESI contribution deducted, Contribution by the Employer and total for the contribution period (six months) 2. Accident book in form 15 3. ESI Declaration in form 1, 4. Return of declaration in form 3 5. Return of Contribution in form 6 for the contribution period (with similar entries as in register of employees Form 7) 6. Accident report in form 16. (similar to Form 18 to be furnished to the Inspector of Factories and Boilers)
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EMPLOYEES PROVIDENT FUND AND MISC. PROVISIONS ACT, 1952

An Act to provide for the institution of provident funds, pension funds and deposit linked insurance fund for the employees in the factories and other establishments Extends to the whole of India except the State of Jammu and Kashmir
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Applicability

Applies to all factories and establishments in which 20 or more are employed Continuity of application Exemption Where employees get benefits in the nature of provident fund or old age pension fund from the establishment which are not less favorable than the benefits under the Act.
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Schemes under the Act

Three beneficial schemes1.Employees Provident Fund Scheme 1952 2.Employees Pension Scheme 1995 3.Employees Deposit Linked Insurance 1976
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membership
An employee at the time of joining the

employment and getting wages up to Rs.6500/- is required to become a member. an employee is eligible for membership of fund from the very first date of joining a covered establishment.

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Contribution to EPF

Employees share : 12% of the Basic + DA Employers contribution : 12% to be deposited as :

8.33% to be deposited in Pension Fund A/C No 10 and the balance, ie, 3.67% to be deposited in Provident Fund A/C No 01 along with Employees share of 12%
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Contribution (contd.)
Administration charges @ 1.1% of the total wages/salary disbursed by deposit to A/C No 02, Employees Deposit Linked Insurance @ 0.5% of the total wages/salary by deposit to A/C No. 21 and Administration of EDLI @ 0.01% of the wages/ salary by deposit to A/C. No. 22.
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Duties of employer
Employer to furnish information about: (a) Ownership and names of responsible persons of the establishment. (b) Declaration and nomination. (c) Joining and leaving of service by the members in form 5 and form 10 respectively (d) Form 12A with monthly challans of deposit. (e) Form 9 for details of employees. (f) Form 3A/6A at the end of the financial year. (g) Any other information as may be required under Para 76 of the scheme

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Benefits to employees

Provident Fund Benefits Pension Benefits Death Benefits

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Provident Fund Benefits

Employer also contributes to Members PF @ 3.67% (1.67% in case of sick industry - eg: beedi) EPFO guarantees the Employer contribution and Govt. gives a decent interest to PF accumulations Member can withdraw from this accumulations to cater financial exigencies in life - No need to refund unless misused On resignation, the member can settle the account. i.e., the member gets his PF contribution, Employer Contribution and Interest

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Pension Benefits
Pension to Member Pension to Family (on death of member) Scheme Certificate This Certificate shows the service & family details of a member This is issued if the member has not attained the age of 58 while leaving an establishment and he applies for this certificate Member can surrender this certificate while joining another establishment and the service stated in the certificate is added with the service he is gaining from the new establishment. After attaining the age of 50 or above, the member can apply for Pension by surrendering this scheme certificate (if total service is at least 10 years) This is a better choice than Withdrawal Benefit, that if a member dies holding a valid scheme certificate, his family will get pension (Death when NOT in service)
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Pension benefit (contd.)

Withdrawal Benefit if not eligible for pension, member may withdraw
the amount accumulated in his pension account the calculation of this amount is based only on (i) Last average salary and (ii) Service (Not based on actual amount available in Pension Fund Account)
No amount is taken from Member to give Pension to the Member. Employer and Govt. contribute to Pension fund @8.33% and @1.16% respectively EPFO guarantees pension to members, even if the Employer has not contributed to Pension Fund.

Pension calculation is similar to that of Govt. Employee

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Death Benefits
Provident Fund Amount to Family (or to Nominee) Pension to Family (or to Parent / Nominee) Capital Return of Pension Insurance (EDLI) amount to Family (or to Nominee)

No amount is taken from Member for this facility. Employer contributes for this.

Nominee is basically determined as per the information submitted by the member at this office through FORM-2
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