Measures Taken By the ESIC During Covid – 19 Pandemic

Measures Taken By the ESIC During Covid – 19 Pandemic

Executive Summary:

• ESIC is implementing the Atal Bimit Vyakti Kalyna Yojna under which unemployment benefit is paid to the workers covered under ESI Scheme.
• The ESI Corporation has decided to extend the scheme for one more year up to 30th June 2021.
• Claims under the ESI Scheme for job loss benefit will be settled in 15 days.
• The relaxation in the Scheme will give relief to those ESI subscribers who lost their job during Covid epidemic.
• The scheme now offers double the payment for three months at 50 per cent against 25 per cent earlier, for the period March 24, 2020 to December 31, 2020.
• The claims can be filed after 30 days from unemployment against 90 days earlier. The claims can be filed directly by workers whereas earlier they needed to be routed through employers.

Introduction:

The Employees’ State Insurance Corporation has during its 182nd meeting held on 20th August, 2020, decided to take steps to towards improvement in its service delivery mechanism and providing relief to workers affected by Covid-19 pandemic. The proposal was approved at a meeting of the Employees State Insurance Corporation (ESIC) board headed by the union labour minister Mr. Santosh Gangwar. The ESIC has calculated that the move will benefit some 4.1 million beneficiaries in the March to December 2020 period.

The members of Employees’ State Insurance Corporation (ESIC) will now get enhanced unemployment allowance and more expeditiously till December this year. The benefits will be available to members of ESIC who lost their jobs during the Covid-19 pandemic.

There had been demands from several sections to provide wage relief to workers hit hard by the pandemic. Hence this move comes as a major relief for industrial workers, who have lost jobs or are on the verge of losing jobs due to the impact of the pandemic and the lockdown, which had stalled economic activity.

Measures taken by ESIC

1. Relaxation

Relaxation in eligibility criteria and enhancement in the payment of relief under Atal Bimit Vyakti Kalyan yojana:

ESIC is implementing the Atal Bimit Vyakti Kalyna Yojna under which unemployment benefit is paid to the workers covered under ESI Scheme. The ESI Corporation has decided to extend the scheme for one more year upto 30th June 2021. It has been decided to relax the existing conditions and the amount of relief for workers who have lost employment during the Covid-19 pandemic period. The enhanced relief under the relaxed conditions will be payable during the period of 24th March, 2020 to 31st December, 2020. Thereafter the scheme will be available with original eligibility condition during the period 01st January, 2021 to 30th June, 2021. Review of these conditions will be done after 31st December, 2020 depending upon the need and demand for such relaxed condition.

2. Applicability

This scheme is applicable to Industrial workers with a monthly income under Rs 21,000 where every month a portion of their salary is deposited with the ESIC to avail medical benefits from primary to tertiary care facilities.

These workers called IPs, each pay 0.75% of their basic salary, and 3.25% is given by the employer to the ESIC funds.

For such workers, the eligibility criteria for availing the relief has been relaxed, as under:

• The payment of relief has been enhanced to 50% of average of wages from earlier 25% of average wages payable upto maximum 90 days of unemployment (once in a lifetime subject to certain conditions).
• Instead of the relief becoming payable 90 days after unemployment, it shall become due for payment after 30 days.
• The Insured person can submit the claim directly to ESIC Branch Office instead of the claim being forwarded by the last employer and the payment shall be made directly in the bank account of IP.
• The Insured person should have been in insurable employment for a minimum period of 2 years before his/her unemployment and should have contributed for not less than 78 days in the contribution period immediately preceding to unemployment and minimum 78 days in one of the remaining 3 contribution periods in 02 years prior to unemployment.

The key criterion for eligibility of the unemployment allowance-

• He/she should have been rendered unemployed during the period relief is claimed.
• He/she should have been in insurable employment for a minimum period of 2 years immediately before his/her unemployment.
• He/she i.e. the insured person should have contributed for at least 78 days during each of proceeding 4 contribution periods.
• Earlier, the claim was to be submitted through employers, however keeping in mind the current conditions, norms have been eased to allow workers to approach the ESIC office to avail the claim.

3. Measures

The measures include establishment of ICU/HDU (Intensive care unit) services at 10 per cent of total beds in ESIC Hospitals:

• With a view to strengthen ICU/HDU services in ESIC hospitals amid the Covid-19 pandemic, it has been decided to establish ICU/HDU (High Dependency Unit) services up to 10 per cent of total commissioned beds in all ESIC Hospitals.
• ESIC covers about 3.49 crore of family units of workers and provides matchless cash benefits and reasonable medical care to its 13.56 crore beneficiaries.

4. Relief Measure

Besides these, the following relief measures have been undertaken for Insured Persons and Beneficiaries:

• In order to ease hardship of ESI Beneficiaries, purchase of medicines by ESI beneficiaries from private chemists during the lockdown period and its subsequent reimbursement by ESIC has been permitted.
• A provision has also been made for providing medical services to Insured Persons (IPs) and beneficiaries from Tie-up Hospitals, if an ESIC Hospital is declared as a dedicated Covid-19 Hospital to cater exclusively to Corona suspected/confirmed cases. ESI beneficiaries can be referred to tie-up Hospitals for providing prescribed secondary/SST consultation/admission/ investigation, during the period for which concerned ESIC Hospital functions as dedicated Covid-19 Hospital. ESI Beneficiary may also seek Emergency/non-Emergency medical treatment from tie-up hospital directly without referral letter, in accordance with his entitlement.
• Medical Benefit is provided under Rule 60-61 to the Insured persons who cease to be in insurable employment on account of permanent disablement and to the retired Insured Persons, on payment of advance lump-sum contribution for a year at the rate of Rs.10/- per month. Under the prevailing circumstances of lockdown, there may be cases where validity of the medical benefit cards issued to these beneficiaries expire as these beneficiaries are unable to deposit the advance annual lump-sum contribution due to lockdown. Such beneficiaries have been allowed to avail medical benefit under Rule 60 and 61 of ESI (Central Rules) till 30.06.2020.
• The payment of Rs 41.00 crore (approx.) in respect of Permanent Disablement Benefit and Dependents’ Benefit has been sent to the bank accounts of beneficiaries in the month of March, 2020.

Several industry groups had earlier petitioned the government to tap into its reserve funds of ESIC of over Rs 73,000 crore to help part-pay salaries for the workers affected due to the lockdown post the COVID-19 pandemic but the government had stated that it is not in favour of using the ESIC corpus for wage payments and that it already provides for employees to withdraw a basic sustenance amount from their corpus upon losing their jobs. The government has now relaxed the eligibility criteria for the same.

Conclusion:

The steps taken by the Employees’ State Insurance Corporation towards relaxing the eligibility criteria, enhancing the quantum of unemployment benefit, and making the procedure for application simpler will definitely assist a large number of people across the country. It comes a long way from the earlier procedure which required monotonous documentary requirements such as a forwarding letter from the last employer in Form AB-2 and instructions for the insured persons.

While the unemployment rates have gone down since the re-opening of the economy, there is still a large portion of the workforce that requires these unemployment benefits for their regular payments and this step by the government is certainly one which will boost the morale of the larger section of the Indian employment sector, in current turbulent times.

Regards,
Legal Team

Proind Business Solutions Private Limited
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