Category Archives: Benefits

1948 to 1982: IPs drew more than the District Collectors, APFCs and the Income Tax Inspectors!

05.06.2020

To
The Director General,
Hqrs. Office,
ESI Corporation,
New Delhi 110002.

 

Sub: Undermining the basic concept of social security – through definition of the terms ‘employee’ and  ‘wages’ – Clause 2 (26) and Clause 2 (80) of the Code on Social Security, 2019 (Bill No. 375 of 2019 in the Lok Sabha) – representation – submitted.

 

Ref: 1. The Legal notice sent by me on 25.05.2020.

2. Email dated 29.05.2020 sent from the Wage Cell of the Ministry of Labour & Employment to the Director General, ESI Corporation, New Delhi.

 

Sir,

1 . I invite your kind attention to the references cited. I submit that the Ministry of Labour has, in the reference second cited, requested for the views of the Hqrs. Office of the ESI Corporation on the issue of wrong equation of the definition of the term ‘wages’ given in Sec. 2 (y) of the Code on Wages, 2019 with the definition of the term ‘wages’ given in the Clause 2 (80) of the Bill on the Code on Social Security, 2019 (Bill No. 375 of 2019) which has been tabled on the Lok Sabha.

Successful Economy presupposes Successful Social Security:

2 . Historically, right from the day when the Royal Labour Commission had undertaken tour in the year 1929 (after the enforcement of the Workman’s Compensation Act, 1923) to study the living conditions of Indian Labour, the employers had been resisting labour welfare measures, as they were under the popular impression (popular among themselves) that the such measures would be increasing their overheads and that they could not compete in the world market. A ‘successful economy’ cannot be built without ‘successful social security’. Both are intricately intertwined, as has been demonstrated by West Germany during the period between 1945 (when Germany was defeated in the WW II) and 1971 (when its DM attained full value). Franklin D. Roosevelt has gone on record having said, at the time of signing the Social Security Act, on 14th August, 1935, that Act was, “in short, a law that will take care of human needs and at the same time provide the United States an economic structure of vastly greater soundness.”

3. “Willing participation of labour” can be obtained only through social security as observed by the Sir William Beveridge in his monumental report presented in November, 1942. Indian social security system was modelled on the report of Beveridge by Prof. Adharkar. Such willing participation would not be there if the benefits provided at the time of contingencies like sickness, accident, maternity, etc., are not really meaningful and substantial to enable the workers to sustain themselves. That was the precise reason that the term ‘wages’ under Sec. 2 (22) had been so defined in the original Act that it was not only the fixed components but also the variable components  would be taken into account for determining the recovery of contribution from the employers and to pay benefits to the employees.

Inspections were meant to confirm contribution on real wages and detect concealed employment:

4. I submit that the present opportunity extended by the Ministry of Labour to examine the issue may kindly be made use of and the spirit of the definition under Sec. 2 (22) of the ESI Act,1948 maintained and those provisions retained. This is all the more essential in the context of downplaying the real importance of inspection of records of the employers to ensure proper compliance. “You don’t get what you expect. You get only what you inspect”. This is what the IAS officers are taught too at Mussorie. But the recent labour legislations are to the contrary and the result is that the workers remain uncared for.

5. Proper and in-depth inspections alone can ensure that all the coverable employees have been covered without being left out, and that contributions are paid on their behalf on all items of wages. Simply expecting that the employers would pay contribution on all items on which it is payable, just because there is a law to that effect would not work. All the officers from the level of Insurance Inspectors (later SSOs) to the level of Deputy Directors of the ESI Corporation, who had attentively handled the subject would provide numerous evidences of the manner in which the employers tried to play with the term ‘wages’ to pay contribution on reduced amount of wages which would, in turn, result in reduced quantum of benefits to the employees facing contingencies. (More in this regard in the Appendix).

6. It is, therefore, necessary to maintain the difference in the definition of the term ‘wages’ which was conceived of in the year 1948 itself, at the time of enactment of both the Acts, the Minimum Wages Act, 1948 and the ESI Act, 1948. There cannot, therefore, be one and the same definition of the term ‘wages’ for both enactments, the Code on Wages, 2019 and the Code on Social Security, 2019.

ESI Wage Ceiling was on par with the salary of Group ‘A’ Officers:

7. Already because of the weakness of the politcians-in-power to yield to the pressure from the lobby of the employers, the ‘wage ceiling’ under the ESI Act was not kept at the appropriate original stage, especially after 1975. There was a lot of resistance from the employers to revise the wage ceiling for coverage under the ESI Act, periodically, on par with the Consumer Price Index. The ESI Scheme had, in the process, lost its original direction and, thereby, its purpose too, to cover a large section of the middle-level income earners among the Indian population. Consequently, the ESI scheme could not extend its coverage to other classes of establishments, although a provision had, thoughtfully, been made for it under Sec. 1 (5) of the ESI Act.

8. It is, therefore, necessary to examine the issues under Sec. 2 (9) of the ESI Act also while examining the impact of Sec. 2 (22) as both are inter-twined. In the context, I would like to submit a few facts for your kind consideration:

a. When the ESI Act was enacted in the year 1948, the wage ceiling for the purpose of coverage was Rs. 400 pm excluding overtime allowances, as per the proviso to Sec. 2 (9) of the Act. At that time, the total salary of a District Collector was less than that. “A princely sum of Rs. 350 was what used to be the total salary of an IAS (ICS) officer at the start of his services in 1949”. It would show that the framers of the Act conceived of the extension of social-security-net not just to the ‘downtrodden’ but to the well-enlightened and well-paid employees too.

b. In the year 1966, this wage ceiling was increased to Rs. 500 pm (excluding overtime allowance), through a formal amendment to the Act, by the Parliament of India. At that time, the Basic Pay for a new entrant IAS officer in the Junior Scale was Rs. 400 pm in the scale of Rs. 400-400-500-40-700-EB-30-1000 (Ref: Page 109 – Chapter 11 – All India Services – Report of the Third Central Pay Commission – Vol I – Published by the Ministry of Finance, Government of India). A new entrant IAS officer was drawing a total salary of less than Rs. 500 pm in a ‘C’ class of the city.

c. Another relevant and interesting fact in this regard was that as per Sec. 17 (1) of the original ESI Act, permission of the Central Government was required to be obtained by the ESI Corporation, only for the creation the posts which carried the pay scale, the maximum of which was Rs. 500. This figure of Rs. 500 in the year 1948 which was the maximum of the required pay scale for such creation of posts would amply illustrate the importance of the wage ceiling of Rs. 400 pm, at that time, (excluding over time allowance) prescribed for coverage of employees in the factories and establishments. That was the then-intended reach of the ESI Act. (Later this provision has been shifted to subordinate legislation, through an amendment in the year 1975,  and now such a permission of the Central Government is sought only for the posts in NFSG as per Rule 20 of the ESI (General) Rules, 1950. )

d. In the year 1975, the wage ceiling for coverage was increased to Rs. 1000 pm, through another formal amendment, by the Parliament of India. At that time, the Third Pay Commission had given its report, according to which the Pay Scale of Income Tax Inspector was 425-700. The Customs Inspector was also drawing in the same scale of 425-700. Thus, when the ESI Act was amended in the year 1975 increasing the wage ceiling to Rs.1000 pm (excluding over time allowance), a new entrant Income Tax Inspector was drawing around Rs. 500 pm only as his total salary in a C class city. A new entrant Class I officer, like the Deputy Director in the ESI Corporation or the Assistant Provident Fund Commissioner in the EPF Organisation then, was drawing less than Rs. 1000 pm as his total salary, as his Scale of Pay was only Rs. 700 – 1300, after the enforcement of the Third Pay Commission Report.

e.  Given the above scenario, the impact of coverage of the employees in the factories and establishments drawing wages up to Rs. 1000 (excluding over time allowance) could be easily understood. On numerous occasions, during the personal hearings afforded to employers as per Sec. 45 (A) of the ESI Act, 1948, the Deputy Directors of the ESI Corporation had to encounter the employer’s staff members who were drawing more than the Deputy Directors of the ESI Corporation. It was only in the year 1982 that the salary of the Income Tax Inspectors in the ‘C’ class cities crossed the limit of Rs. 1000 pm, and started overtaking the wage ceiling prescribed under the ESI Act for the coverage of the Insured Persons, which continued to remain at Rs. 1000 (excluding over time allowance).

f.  In the year 1984 the wage ceiling was increased to Rs. 1600 pm under Sec. 2 (9), excluding over time allowances. But, soon, as per the Fourth Pay Commission recommendations, from 01.01.1986 onwards, the Pay Scale of the Income Tax Inspectors overtook, again, the wage ceiling prescribed under the ESI Act. The Pay Scale of the Income Tax Inspectors was increased to Rs. 1640-2900 and the salary of the Deputy Directors in the ESI Corporation and the Assistant Provident Fund Commissioners in the EPFO were fixed in the Pay Scale of 2200-4000.

g.  Thereafter, the wage ceiling for coverage of insured persons under the ESI Act was not increased at any time on the pattern of the increase made earlier through amendments made to the ESI Act in the year 1966 or 1975, to keep within coverage the insured persons who were drawing wages on par with the salary of the central governments at the middle management level in the Central Civil Service, let alone the position conceived of in 1948 to keep within coverage all those drawing wages even above the salary of the District Collectors.

h .The initial salary of a District Collector now in a ‘C’ class city with a Grade Pay of Rs. 8700, the salary of a new entrant Income Tax Inspector with a Grade Pay of Rs. 4600 and the salary of the APFC with a Grade Pay of Rs. 5400, at present, are far above the wage ceiling of Rs. 21000 presently fixed for coverage of employees under the ESI Act. It is only the salary of the MTS, whose cadre is the lowest point of entry into Central Civil Service ranges from 18000 to 20000 now and is below the wage ceiling of Rs. 21000 pm (excluding over time allowance) prescribed under the ESI Act for coverage of insured persons working in factories and establishments.

I submit that the aforesaid facts would convince everyone how the enlightened section of the employees of the factories and establishments were silently made to keep themselves away, in phases, from the ESIC and from having active participation in monitoring the functioning of the ESI Scheme.

9. The employees’ representatives in the supreme body of the organisation could not get better feedback from such enlightened well-paid employees of the factories and establishments. They, in turn, could not represent the cases of the employees before the the ESIC administration, especially about the medical benefits provided by various state governments, especially the state governments of Bihar, MP, Rajasthan, and UP.

10. A social security scheme, which was originally intended to cover not only the so-called ‘blue-collared workers’ but also the ‘white-collared employees’ was, thus, made to leave out the white-collared employees in bulk during the course of just three decades from 1952. It is significant to point out at this juncture that in the year 1947 when the Bill was prepared, it was called only as “Workman’s State Insurance Bill” on the lines of the Workman’s Compensation Act, 1923. But its name was changed later as “Employees’ State Insurance Bill” considering the extent of its intended reach.

Social Security a ‘service’ not a ‘business’:

11. It is submitted that if the present definition of the term ‘wages’ as per Clause 2 (80) and the definition of the term ‘employee’ as per Clause 2 (26) of the present Bill on the Code on Social Security is made law, the coverage of employees for the purpose of providing social security benefit would not only be infinitesimal but also insignificant. Providing Social Security to the people of the nation, which is a ‘Service’ to be provided by the sovereign government, will get converted by the aforesaid two definitions into ‘business’ by and for the private ultra-rich.

No proper study for Social Impact Assessment:

12. All these modifications have, apparently, been done without conducting any study on the Social Impact on the Indian society. It is submitted that the report of the Second National Commission of Labour cannot be cited as a ruse for these micro level changes which would are intended to have far-reaching deleterious effect on the Indian society as a whole. It is a fact that the Second National Labour Commission did not say anything about drafting a labour law, a Social Security Code, to facilitate handing over the ESIC Medical Colleges along with major hospitals to ‘any person’ or any ‘organisation of persons’, by inserting such questionable phrases as has been recorded in Clause 41(5) of the draft Code dated 17.09.2019  and Clause 39(5) of the Bill 375 of 2019 respectively.

West Bengal ESI Hospitals well-run and incentive grant provided:

13. It is submitted that providing social security to the working population is a sovereign function of the State just like running the nation through Revenue Departments or maintaining law and order through Police Department and administering  justice through Courts of Law. Just because there is deterioration in services in certain pockets because of the corrupt politician-bureaucrat nexus, as is said to be there in Revenue Department and Police Department or the political interference said to be there in the Judiciary, there is no proposal coming up from any quarters to dispense with these departments or institutions but to insulate them from corruption and political interference. The  concept of the ESI Scheme cannot also be derided and attempted to be dispensed with, for the very same reason. Experience has demonstrated, on many occasions, that the ESIC could be run finer and could be run corruption-free, when there is no political interference in the administration of the organization. The Scandinavian countries top the Human Development Index consistently for long, only because the organizations which provide social security benefits there are run corruption-free.

14.  The Chief Minister of West Bengal had said, “The excellent performance of the ESI Hospitals in West Bengal run by our labour department has been recognized by the Centre. An incentive grant of Rs 22.33 crore has been provided, which is first time ever to be received by any ESI Hospital in the country,” (Times of India 09.11.2014).

Judiciary wanted to impose costs on the draftsmen and the legislators:

15.  Lord Justice Scrutton observed the following in Roe vs. Russel (1928) :“I regret that I cannot order the costs to be paid by the draftsmen of the Rent Restriction Acts, and the members of the Legislature who passed them, and are responsible for the obscurity of the Acts.” (Page 94- The Closing Chapter – Lord Dennings). The Act passed by the British Parliament was so ambiguous that Lord Scrutton regretted his inability to impose penalty (cost) on the persons who brought into existence such a loosely drafted law.

16.  Another Judge Sir Ernest Gowers who said the following in the Plain Words case in the year 1948 as the duty of the draftsmen (Page 95 ibid.): “…. to try to imagine every possible combination of circumstances to which his words might apply and every conceivable misinterpretation that might be put on them, and to take precaution accordingly. ….All the time he must keep his eyes on the rules of legal interpretation and the case law on the meaning of particular words [and on the previous statutes on the same subject-matter] and choose his phraseology to fit them.”. We the Indians, who are said to have adopted the British system of governance more, have to demonstrate that we are capable of framing laws in a proper manner. But the present Bill No. 375 of 2019 does not fit into the parameters of proper law.

Nexus between Clauses 2 (26), 2 (80) and Clause 39(5):

17. I submit that the phraseology of Clauses 2 (26) and 2 (80) read with the phraseology of Claus 39 (5) give a discerning reader reason to believe that there is close nexus between the purpose for which these clauses have been inserted the way they are. I submit that I have used the phrase ‘reason to believe’ in the foregoing sentence with all its legal import as elucidated by the Hon’ble Supreme Court of India in Sony India Ltd Vs. Commissioner of Income Tax on 12.05.2005. The contents of Clause 39 (5) on the one hand and the contents of Clauses 2 (26) and 2 (80) on the other, lead one to the belief that there is a rational connection between the two. The contents of Clause 39 (5) do have a relevant bearing on Clause 2 (26) which leads to the formation of the aforesaid belief.

18. I, therefore, pray that action may kindly be taken to retain in the Bill on the Code on Social Security, 2019 (Bill No. 375 of 2019) the definition of the term ‘wages’ as given in Sec. 2 (22) of the ESI Act, 1948. In the alternative, the contents of Cl. 2 (80) of the said Bill No. 375 of 2019 may be caused to be re-examined and the following words and phrases deleted from the definition of the term ‘wages’ as given therein:

a. The phrase ‘any conveyance allowance or” appearing in the Exclusion Clause (d) of the definition has to be deleted;

b. The phrase ‘house rent allowance” appearing in the Exclusion Clause (f) of the definition has to be deleted;

c. The phrase ‘any overtime allowance” appearing in the Exclusion Clause (h) of the definition has to be deleted;

d. The phrase ‘any commission payable to the employee” appearing in the Exclusion Clause (i) of the definition has to be deleted;

e. The first proviso should be totally deleted as it does not have relevance in a social security enactment. In other words, this proviso starting with the phrase “provided that for calculating” and ending with the phrase “added in wages under this clause” requires to be deleted in toto.

Thanking you,

Yours faithfully,

Encl: Appendix.

 

 

Copy submitted to

The Secretary, Ministry of Labour & Employment, GOI, New Delhi.

The Secretary, Ministry of Law & Justice, GOI, New Delhi.

 

 

1 Comment

Filed under Benefits, For Trainees

Maternity Benefits under SS Code : Piloting it the wrong way ! – Part 1

Maternity Benefit slide_page-0001 (2)

The year was 1983. The ESI Corporation wanted to make some path-breaking changes and to bringing in suitable amendments. The Contribution Card system with stamps had already been replaced with the Contribution Card system with cash. The issue now was that the classification of employees into three sets, viz., A, B and C, was to be given a go by. Common Contribution Period and Benefit Period was being contemplated. The Hqrs. Office of the ESI Corporation asked the Regional Directors to offer their opinion. The Regional Directors asked, in turn, the field officers the Managers of the Local Offices and the Insurance Inspectors to explain their stand. The outcome was the evolvement of law which ensured the introduction of new system providing for all the practical difficulties in its implementation.  The opinions offered ensured that the procedure evolved was not only not cumbersome but also one that advanced the purpose of the Act. Continue reading

Leave a comment

Filed under Benefits, Labour Code 2020

Do not amend Sec. 44 and wreck the safety-net ! Save ESIC and Save the nation !!

 

2012

In the year 2012, President Obama claimed that insurance premiums would go down (The Washington Post 10.08.2012).

https://www.washingtonpost.com/blogs/fact-checker/post/president-obamas-claim-that-insurance-premiums-will-go-down/2012/08/09/424048f2-e245-11e1-a25e-15067bb31849_blog.html

2016

The cost of health insurance under the Affordable Care Act is expected to rise an average of 22 percent in 2017, according to information released by the Obama administration Monday afternoon.

Still, federal subsidies will also rise, meaning that few people are likely to have to pay the full cost after the rate increases to get insurance coverage.

“We think they will ultimately be surprised by the affordability of the premiums, because the tax credits track with the increases in premiums,” said Kevin Griffis, assistant secretary for public affairs at the Department of Health and Human Services.

The 22 percent rise reflects the average for all insurance marketplaces, both federal and state-based exchanges for which data are available. For insurance purchased through the federal HealthCare.gov exchange the rise will average 25 percent.

During a media briefing Monday, Griffis said the 2017 rates are roughly at the level the Congressional Budget Office forecast when the law was proposed. “The initial marketplace rates came in below costs,” he said. “Many companies set prices that turned out to be too low.”

Enrollment opens Nov. 1. For coverage effective Jan. 1, people need to pick a plan by Dec. 15. With a few exceptions, the last day to sign up for Obamacare is Jan. 31, 2017. Plans are available on HealthCare.gov and state-run exchanges.

While the average premiums on the benchmark health plans are increasing, the government says more than 70 percent of people buying insurance on the marketplaces created by the law could get a health plan for less than $75 a month for 2017. To get the best deal, people would have to pick a low-cost plan with limited benefits and take advantage of all the subsidies available.

People who already have coverage through the exchanges can often save money by switching plans, the administration said. More than three-quarters of people could save money by switching to the lowest-cost plan within the level of coverage, such as bronze or silver, that they’ve previously selected.

The Obamacare insurance exchanges are under strain after three major insurers pulled back from offering coverage in markets across the U.S. The administration says about 1 in 5 people buying insurance through the marketplaces will have only one company offering coverage.

It’s in places like that where consumers will feel the most pain. “Where it really matters is where a big insurance company has exited and where that’s going to leave just one company remaining,” said Cynthia Cox, associate director of health reform and private insurance at the Kaiser Family Foundation. “For those people who live in that area, many people may have to switch plans. And they won’t have much choice if they want to receive financial assistance and purchase through the exchanges.”

http://www.npr.org/sections/health-shots/2016/10/24/499190020/rates-rise-again-for-obamacare-health-plans-but-so-do-subsidies

 

1 Comment

Filed under Benefits, For Trainees, Inspections

Time spent traveling to and from work is “work”- European Court of Justice !

” European Court of Justice said its ruling was made to uphold the health and safety of workers, which is protected by the EU’s working time directive. This legislation mandates that no employee should be forced to work more than 48 hours per week.”

For more:

http://qz.com/500186/a-court-has-ruled-that-time-spent-traveling-to-and-from-work-is-work/?utm_source=atlfb

Opposite is in India, run by businessmen-controlled-politicians, notwithstanding Sec. 51-E, which was a definite progress, in spite of procedural difficulties.

Here, increase in the Over time limit, meant actually to facilitate exploitation by the employers, is projected as a labour welfare measure:

picture1

Safety and Health – Polls apart 

“Requiring them to bear the burden of their employer’s choice would be contrary to the objective of protecting the safety and health of workers pursued by the directive, which includes the necessity of guaranteeing workers a minimum rest period.” – says the European Court of Justice.

Increasing the spread-over period to 12 hours is shown as the a safety and health measure in India. 

There is no necessity to guarantee the workers any “minimum rest period”.

Mayday revolution resulted in 8+8+8 hours, i.e., 8 hours for work, 8 hours for forest, recreation with family and 8 hours to sleep. But, already the official 8 hours work has become 12 hours including the time taken for commuting to and fro workspot, in India. When the spread-over period is 12 hours, and the journey between the residence and workspot takes another 4 hours, where is the time for rest, family and sleep?

We are creating a society that would be poor in health and would need more medical attendance resulting in more expenditure on medical side by the ESIC and the State.

We do not care for any respectable slot in the Human Development Index or Global Prosperity Index.

Those who can change things, do not do their bit. But, they work for extricating themselves from that situation personally.

When are we going to usher in a civilised society free from exploitation?

=======================Added later:=================

The action taken by the Indian government through the Bill for “improving safety and health of workers”  is contrary to the guidelines given by the UNO on “improving the safety and health of young workers” (For more: https://www.ilo.org/wcmsp5/groups/public/—ed_protect/—protrav/—safework/documents/publication/wcms_625223.pdf ) 

1 Comment

Filed under Benefits, Inspections

Clubbing different units together !

In the days of yore, inspections in the ESIC were programmed and conducted in such a manner that they would, really, detect concealed employment and be  beneficial to the insured persons. At that time the upper limit of wages for coverage was Rs. 1000 pm. If a factory employed 20 or more persons for wages, it became coverable under the ESI Act, even if the 19 persons received wages more than Rs. 1000. The remaining one person whose wages were 1000 or less became coverable. The intention was to ensure wider reach of the scheme.

There were many instances in which the middlemen worked hard to ‘help’ employers evade coverage. They followed variety of techniques for such evasion. One such technique that benefitted those employees was an ingenuous one that helped them evade not only the ESI Scheme but also the income tax and many other statutory provisions. That was the technique of splitting the unit and showing the single unit as various independent units owned by different persons. Usually, those ‘different’ persons happened to be  father, mother, wife, son, daughter, or other close relatives.

There would be a single premises in which 24 powerlooms would be functioning. It requires 6 persons for a single shift. There would, therefore, be 18 persons for three shifts. Besides, there would be two ‘khaandi’ machines to prepare shuttles. It required 2 persons per shift. In all there would have to be 6 persons for three shifts. In addition, the Folders, Clerks and others would carry the figure of total number of employees to 30. But, the employers would get the blue prints prepared showing that the 24 powerlooms belonged to four different owners. They would get factory licence also that way.

When the ESI Inspector visits the factory, they would claim that there were four different factories. There would also be four set of account books. But, when the account books are closely verified, one could see that the division was fake and the management and functioning of all the four units are integrated and there, really, is one one single homogenous  unit. The khaandi machines which would remain located in the area allotted only for one unit, as per the blueprint,  would supply shuttles to all the powerlooms. The motive power would be shown differently for different units, but electricity for lights for the entire factory would be supplied from only one unit. There cannot be reimbursement from other units, as it would provide clear evidence to the unlawful nature of such sharing. Finished products would be stored in a combined manner only in one room. The employees do not know the names of the other owners except the one who manages them every day and pays wages. In such cases, when the units showed functional, financial and managerial integrality, they would be clubbed together and covered under the ESI Act as a single unit.

There were lodges and restaurants in the same premises and the owners claimed that they were independent legal entities. But, the records would show that the employees of the lodge and restaurant were interchangeable and were paid the same wages that included the cash and food components. The restaurant was providing food to all the employees of the lodge but there was no reciprocal arrangement to reimburse the cost of food by the lodge. These instances would show more than the normal B2B relationship between the owner of the lodge and the owner of the hotel, who were just father and son, in real life. In such cases, the ESI Act was enforced against both of them, by clubbing both the lodge and hotel together.

There was a textile shop with a single brand name but,the premises of the establishment would show that it was a three-storey building housing three different units, one for mens wear, another for women and yet another for kids. The employers were not allowed to evade coverage under the ESI Act in such cases. All the three were clubbed together and covered as a single entity.

On the other hand, there were some major employers who opted for combined compliance in respect of ESI provisions, to facilitate their maintenance of records, in spite of the fact that each unit was employing more than 100 persons and were coverable independently.

While the present method, invented by the bureaucrats at the Centre, make the entire inspection procedure a tragicomedy leaving the inspectors (SSOs) to verify, at best, only the current compliance, it would be worth pondering over the manner in which surveys were conducted with adequate depth and different units were clubbed together to extend the security-net to the insured persons / employees of all those units.

Those employers who want to make right compliance under the ESI Act, may find it helpful to verify for themselves whether they meet the following parameters. That will help them to provide ESI Coverage to their employees by clubbing various units together under Reg. 38 of the ESI (General) Regulations, 1950. For more on this issue, please click on the following link:

Clubbing of units

There was a peanuts vendor who was employing three persons in his shop. His small shop was adjacent to that of a hotel. The hotel had, at that time, been covered as a factory and it had been complying with the provisions of the ESI Act. When the ESI Inspector visited the hotel for the purpose of inspection, he found that there were only 22 employees in the Attendance Register but the hotel owner was paying contribution for 25 persons every month. When asked, the hotel owner, the employer, clarified that the owner of the neighbouring peanut shop was paying money to him and he, in turn, was paying contribution in respect of three of his employees in the pea-nut shop. On investigation, the employees of the pea-nut shop were delinked.

That pea-nut vendor said that he had, earlier, been working in a textile mill in Maharashtra and that he knew the importance of and the benefits provided by the ESI Scheme.

 

1 Comment

Filed under Benefits, For Trainees, Inspections

Seasonal Factory

Seasonal

Leave a comment

August 5, 2015 · 5:52 pm

Dog-feed expenses: Wages u/s 2 (22) !

 

The ESI Act was enacted only with the objective of providing a variety of benefits to the working population. The provisions for inspection mentioned in the statute are, therefore, not contradictory to this objective but only to ensure and further that objective. The perception that the inspection procedure in the ESI Act is intended to harass the employers is not correct and has been orchestrated by vested interests with ulterior motive. One may recall that when the Government of the UK had brought in many labour reforms through the Factories Act 1802 (also called the “Health and Morals of Apprentices Act”, which regulated factory conditions, especially in regard to child workers in cotton and woollen mills), provisions were made to impose fine between £2 to £25 on the factory owners for violation of law. But, the Act did not yield the desired results, as it failed to include any provision for supervision to make sure the law was being followed. It was in the year 1833 that the concept of inspection was born and the sufferings of the workmen at the hands of greedy employers came to be preventable.

Slide1

But, in India, the importance of inspection is diluted again and again for the past seven years in the ESIC. Adding to the misery of the workforce is  the amendments in other labour laws and dilution in their implementation, All these have practically converted the entire labour force of India  into Slave Labour. The latest dilution in inspection of the factories and establishments, in the guise of mechanisation and centralisation, results in the sufferings of the honest and innocent workmen as the employers have come to know that they would not, in practice, face any penal action for non-payment of contribution on all items of ‘wages’ in respect of all ‘employees’. The drastic reduction in revenue that flows in, on its own, through Sec. 39 & 40 of the Act is a clear indicator of this fact. India is virtually sliding backwards to the pre-1833 era of the UK.

It is a fact that large number of employers try to avoid paying contribution in respect of “all” (as mandated by Sec. 38) the persons employed by them for wages. They resort to various methods of manipulations of their records to conceal the “employment of persons’ and “payment of wages”.

Such concealed employment can be detected only through proper inspection including Ledger Verification in a thorough manner. A simple visit by the Inspector or his going around the factory cannot help detecting such cases.

 You get only what you inspect.

Proper and in-depth inspections alone can ensure that all the coverable employees have been covered without being left out, and that contributions are paid on their behalf on all items of wages. Simply expecting that the employers would pay contribution on all items on which it is payable, just because there is a law to that effect would not work.”You don’t get what you expect. You get only what you inspect”. This is what the IAS officers are taught too.

Besides, when contribution is not paid on all items of wages, the benefits payable becomes only be a pittance and would not help sustenance of the family of the insured persons during the periods of sickness, maternity, etc.,

Sec. 45 (1) and (2) are there in the ESI Act is, therefore, intended to safeguard the benefit provisions and they are there in the Statute to protect the interest of the employees. (For more on the need for inspections: https://flourishingesic.info/2012/11/22/esic-inspection-procedure-and-its-impact-on-society/)

Voucher Verification

The most essential component of inspection is “voucher verification”. The inspectors (SSOs) of the ESIC and the officers who conduct test inspections are specially trained on this aspect, so that they can detect concealed employment and omitted wages. “The books of accounts would not be of much use without the vouchers, records, papers, etc., on the basis of which such books have been prepared” (Circular dated 27.06.1961 of the Department of Company Affairs).

Any expenditure without proper voucher is to be frowned upon. Instances are numerous when wages were hidden in a voucher pertaining to different kind of expenditure. Likewise, many employees were paid through a voucher created in the name of a single person. The inspector, therefore, goes through vouchers with adequate care and caution.

But, in the peculiar circumstances of our society, there are many instances where genuine expenditure on certain other items are booked in the ledger, without there being any supporting voucher. Such expenditure does not, actually, represent the wages paid by the employer to his employees. What should the inspecting authorities do, then? Can they treat all such voucher-less expenditure, automatically, as wages and claim contribution from the employer? Do they have discretion to ignore such vouchers in toto? Where, then, is the line that differentiates genuine or arbitrary exercise of such power of discretion?

A case of huge expenditure without vouchers

There was a hotel of repute in a prime locality in a city. A minimum of five thousand customers visit the hotel every day to take food. The inspecting authority of the ESIC was pouring through the ledger and vouchers. He found that a large chunk of money accounted for as expenditure in the ledger under a head of account without any voucher for any day. The amount was too huge to ignore. The head of the account was ‘Purchase of Vegetables’. An inspecting authority is not there just to report the expenditure to the Regional Office and believe that he has done his work. He must, being the man on the spot, make genuine efforts to collect all the relevant documents and evidences and arrive at his findings and report the details to the Regional Office for decision. What did he do, in this case?

The employer explained that as a caterer he had to buy vegetables from various vendors, both retail and wholesale, in the market early in the morning at about 3.00 am, every day, depending upon the price and quality. No vegetable vendor would give receipts for the transactions. Not every vegetable vendor is running his trade in an organised form. So, obtaining vouchers from vegetable vendors is simply impossible, practically, he said. And, what he said was true, the inspecting authority knew.

He, therefore, verified the expenditure incurred by the hotelier for purchase of Rice, Wheat, Rava and Maida. He prepared a chart comparing the total expenditure incurred for purchase of these items with the expenditure incurred for the purchase of vegetables. He went through the ledgers once again to ensure that the expenditure for purchase of vegetables had not been booked under any other head of account. He arrived at the fact the expenditure shown under the head ‘Purchase of Vegetables’ had been incurred only for purchase of vegetables although it was not supported by vouchers. He reported all these facts along with his findings that the expenditure on purchase of vegetables was not wages, although the expenditure every year on that count was very huge. His report was examined in depth at the Regional Office and the Regional Director accepted his findings. (Even if the Regional Director had differed, he cannot blame the inspecting authority for his findings. Because, the inspecting authority had given not only his findings / opinion but also all the relevant facts on which he based his opinion and had left the decision to the Regional Office. If the Inspecting authority had reported only the quantum of expenditure as per the ledger figure, he would have been guilty of non-exercise of the power vested in him and transferring his work to the Regional Office. If he had reported only his opinion that said item of expenditure was not wages, he would have made his position vulnerable, in the event of the higher authority taking a different stand. In this case, the inspecting authority had given a speaking and convincing report, the contents of which proved that the inspection had, really, been purposeful.)

Another case of huge but sporadic expenditure

There was an inspector of the ESIC, who was known among employers of the area for his sincerity, honesty and pleasing manners. (It is appropriate to mention in the context the fact that the employers do always collect information about the nature and disposition of the inspecting authorities of various departments, whenever a new incumbent assumes charge in their area). This inspector of the ESIC was conducting regular inspection of the factory of an employer who was employing around 40 employees in his factory, situated in a semi-urban area with a sufficiently large lawn and backyard with many trees all around.   The inspecting authority, while verifying the ledger, came across a head of account titled ‘Dog-feed Expenses’. He thought that the entries of expenditure under that head of account showed the cost of food and, possibly, other maintenance charges to rear the dogs in the premises of the factory. But, he found some peculiarity in the pattern of expenditure. The expenditure had not been incurred every month in a uniform pattern. There was some expenditure in a month. There was no expenditure at all next month. There was huge expenditure in the subsequent month. The inspector was puzzled.

He, therefore, asked for the vouchers. But, the clerk of the employer did not produce them. The inspector insisted on the production of those vouchers. Yet, no voucher was produced and no explanation offered. The inspector, therefore, completed the inspection otherwise and, then, wanted to meet the employer. It was around 3.00 pm, when he was ushered in to meet the employer. The inspector conveyed his findings to him. The employer was listening and was agreeing with him about the defects pointed out by the inspector.

The inspector, then, asked the employer about the expenditure shown as ‘Dog-feed expenses’. The employer said that it was not wages. But, he expressed his inability to produce vouchers for that expenditure. He was also not able to explain how and why the expenditure was sporadic and not uniform every month, if the amount was spent to feed the dogs.

The employer maintained silence. The inspector said that, because of the non-production of vouchers in spite of specific demand, all the items of expenditure under that head of account, could be presumed to be wages and contribution claimed on those omitted wages. The employer thought over for some time and said that he would pay contribution on those omitted wages. He was, still, not ready to explain what that expenditure was. The inspector said that he might have to pay interest and damages too on that expenditure. The employer said that he knew that.

The inspector recorded these facts and issued Visit Note and wound up the inspection. He did not receive the ‘cover’ repeatedly attempted to be given to him by the clerk of the employer, during the course of the day and at the time of leaving the factory. The employer was impressed as he had already heard of the reputation of that inspector. He, therefore, volunteered to walk along with the inspector to the front gate to see him off. The inspector could not see any dog anywhere in the factory precincts and asked the employer about it. The majestic-looking turbaned employer put his hand on the shoulders of the inspector, hugged him and replied, softly, with a smile, that the expenditure booked under that head of account was not the money spent to feed the real dogs. It represented the amount demanded by and paid to the officers of various departments as bribe and to the political parties as donations. That was the reason for the sporadicity of the expenditure, he said. Both of them burst into laughter.

The employer, then, asked the inspector to keep the information confidential and said that he was revealing it only to him, in appreciation of the commitment of the inspector to remain honest by choice.

If only all the employers follow suit ……

1 Comment

Filed under Benefits, For Trainees, Inspections

ESI coverage: Extension, to On-site Construction Workers !

It is reported that “the labour ministry will soon extend its medical coverage benefits to on-site construction workers, a step in the direction to provide social security to a huge section of the unorganised workers”.

Read more at:
http://economictimes.indiatimes.com/articleshow/48123354.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Extending the ESI security-net wider is appreciable indeed.

But, when the Government itself agrees that the On-site construction workers are unorganised workers, it must move forward cautiously. It must keep in view the points discussed during the numerous tripartite talks in the Seventies, Eighties and Nineties. The records in this regard must be available in the Hqrs. Summary of those facts had been recorded in the Annual Standard Notes also upto the year 2000.

It must ensure proper actuarial calculations, especially when the ESIC does not have its own Actuary with the real knowledge about the working of the organisation. It is very essential.

ESI Act is essentially for organised workforce, in spite of the term “otherwise” in Sec. 1 (4). Payment of contributions, submission of returns, reporting accidents and many other formalities would show that the scheme is employer-centric. Yet, the ESIC could not extend the scheme to construction sector because of many practical considerations. That, precisely, was the reason for so many tripartite talks for decades.

So, if necessary, a separate structure may be evolved the way it was done in the later nineties for cashew workers of Kerala. The scheme was, ultimately, discontinued by the ESIC. The documents that show why that scheme meant for cashew workers had been dispensed with may also be gone through, in the present context.

Thereafter, let the authorities have some pilot projects regarding extension of ESI Coverage to the construction workers, experimented in one or two regions, one in the North (Rajastan)  and another in the East(Bengal)  or South(Andhra Pradesh). Let the experience gained be analysed before embarking on coverage nationwide. That will be a prudent, essential and reasonable precaution.

Formulate a system in such a way that it does not allow malingering and false claims.

The experience of the ESIC in respect of the TDB in Bihar and Gujarat must be taken into account with the seriousness it deserves.That will guide the authorities before venturing into the extension of the scheme to construction workers throughout the nation at the initial stage itself. Already, many construction agencies, undertaking Turn-key projects are abusing even the existing provisions, by covering the on-site construction workers, on the sly. The impact of such wrong coverage and the intention behind such voluntary coverage by the construction agencies must be studied with open mind and the facts that emerge out of such study must be accepted, before moving forward with such coverage.

Prof Adharkar, the visionary, has rightly said that when a scheme is proposed it must be workable in the “peculiar circumstances of Indian labour and industry”. Sage words !

Slide2

Already, inadequate knowledge coupled with over-enthusiasm on the part of the people who count has played havoc with the system in certain areas. The Medical College matter is one such case where the authorities do not know what to do next. Let not this proposal to extend the provisions to the on-site construction workers also result in chaos and meet the same fate.

ESIC is not only meant for providing benefits to the deserving insured population. ESIC is also the custodian of funds contributed by honest workforce who believe that the funds would be used rightly, to provide benefits to the really needy. They believe that because the ESIC is a public organisation, it wold take every care to ensure that the funds are not misused by  dishonest employers and employees in connivance with greedy consultants and covetous  bureaucrats.

Proposed scheme must be on practical lines and there must be proper, effective and unambiguous checks and balances. Nebulous law and procedure for settling the claims of such on-site construction workers would result in honest officers and staff shying away from handling the subject.

 

Leave a comment

Filed under Benefits, For Trainees, Inspections

Healthcare: Mr. Jaitley leads the nation to peril !

“If we continue in the direction we’re headed we’ll soon have a health insurance system dominated by two or three mammoth for-profit corporations capable of squeezing employees and consumers for all they’re worth – and handing over the profits to their shareholders and executives.

The alternative is a government-run single payer system – such as is in place in almost every other advanced economy – dedicated to lower premiums and better care.”- Robert Reich.

==================================================

“Insurers are seeking rate hikes of 20 to 40 percent for next year because they think they already have enough economic and political clout to get them.

That’s not what they’re telling federal and state regulators, of course. They say rate increases are necessary because people enrolling in Obamacare are sicker than they expected, and they’re losing money.

Remember, this an industry with rising share values and wads of cash for mergers and acquisitions. It also has enough dough to bestow huge pay packages on its top executives.

The CEOs of the five largest for-profit health insurance companies each raked in $10 to $15 million last year.

After the mergers, the biggest insurers will have even larger profits, higher share values, and fatter pay packages for their top brass.

There’s abundant evidence that when health insurers merge, premiums rise. For example, Leemore Dafny, a professor at the Kellogg School of Management at Northwestern University, and his two co-authors, found that after Aetna merged with Prudential HealthCare in 1999, premiums rose 7 percent higher than had the merger not occurred.” – Robert Reich. ===================================================

In India, the problems would be worse, when private players are allowed to play a role in providing social security. The profit would not be shared with shareholders too. It would be shared with the politicians, as black money.

That is the reason the Indian politicians find it irresistible to yield to the desires of the ultra-rich and make the common public the fodder to feed those ultra rich.

We know this happening already in the Telecommunications sector. The BSNL and MTNL had the wherewithal to provide cable TV connection to all homes and provide all the channels the people wanted. But, they were not encouraged. Will these public sector organisations pay anything to the politicians overtly and covertly? What is the use of these organisations for them? But, the private players in the field rake in a lot and throw a share to the politicians in the name of party-funds, who do not want to make the source of their party funds transparent but share the booty among themselves for which they became politicians first and rulers next. One can compare the remuneration of the chief of Airtel with the chief of BSNL and find who is there for what.

Likewise one can compare the remuneration of the lowest paid clerical staff of the BSNL with his counterpart in Airtel and find who is better off. The modern CEO would ensure that wages fall and profits rise. He would ensure his voice is heard and obeyed while the voice of the employees would never be allowed even to be raised.

Privatisation helps the top man to suck the blood of the public and the subordinates to enrich himself.

These politicians who are after money-bags would not save the nation by privatising Social Security. Their thoughtless action is going to make the life of the future generations miserable.

Mr. Arun Jaitley has said in Para 62 of his Budget speech,”With respect to ESI, the employee should have the option of choosing either ESI or a Health Insurance product, recognized by the Insurance Regulatory Development Authority (IRDA). We intend to bring amending legislation in this regard, afterstakeholder consultation.”. What this forebodes the nation can be seen from the problems faced by the commoners in the USA. The situation in India would become worse.

Let us,therefore, knock at the doors of Judiciary to save the nation from the hands of these greedy politicians, who had already corroded the public sector health care system by their interference and cite the same corrosion as the reason to bring in private players to spoil the nation.

For more: http://www.salon.com/2015/07/07/robert_reich_single_payer_healthcare_is_the_only_way_partner/?utm_source=facebook&utm_medium=socialflow

As rightly analysed by Mr.Reich in some other article, modern day businessmen are not required to be brilliant. He says that the modern day corporate CEO is one “who’s rigged the rules, reaped giant personal rewards, and left communities and employees stranded.” But, the men in power to control the government and the media make the government to propagate and convince the masses that the modern day businessman is a messiah to save the mankind.

Only the awakening of the masses can save their progeny!

Leave a comment

Filed under Administration, Benefits, For Trainees, Medical College Bond

Beware of the Demolition Squad, Mr. Prime Minister! ESIC is the symbol of Civilisation!!

During a meeting of the ILO in the year 1922, When many other countries had introduced various social security measures the Indian Government was wavering. So one member said that among the civilised countries, India was the only country where there was no social security measure. That was an indication that the world considered social security measures as an index of civilisation. The nature of benefits provided in every country under the Social Security Scheme is the indicator of the degree of civilisation achieved by the people of that county.

When Mr. Joshi, the Indian member heard the aforesaid comment in the world body, he got provoked and said that India would bring in legislation for compensation for employment injury. The Workman’s Compensation Act, came into existence next year in 1923 only because of that promise of Mr. Joshi, the Indian representative, in that world body. That was how India took her first step to enter into the civilised world.

The Royal Commission of Labour which toured India for two years from 1929 to 1931 submitted its report stating that the incidence of sickness was more in India than in any other country and the need for sickness insurance was more in India than in any other nation.

The Beveridge Report

The Committee headed by Sir William Beveridge examined the issues pertaining to labour  for one and a half years and submitted, in November 1942, an exhaustive report which paved way for a civilised society. His report aimed at ‘shaping the economy to serve the people’, while the rich and powerful had vested interest in ‘shaping the people to serve the economy’.

Sir William Beveridge in 1944. He became hero overnight when his report was tabled in the House of Commons in December, 1942. Photo Courtesy: The Guardian, U.K.

Sir William Beveridge in 1944. He became hero overnight when his report was tabled in the House of Commons in December, 1942. Photo Courtesy: The Guardian, U.K.

ESI Corporation was not born in a day. It took more than a year and half for Prof. Adharkar to go through the report of Sir William Beveridge to adapt it to Indian conditions. Comprehensive analysis was made on the issues relevant to our nation. The report was submitted by him on 15.08.1944. Consequently, when the ESI Act was enacted in 1948, the responsibility of running the Scheme was vested in the Government.

Art. 41 insists on “Public” Assistance

The founding fathers had rightly entrusted the responsibility of running the Social Security Scheme to the Government only. That was why Art. 41 of the Constitution directs, as under:

“The State shall, within the limits of its economic capacity and development, make effective provision for securing the right
◦ to ……,
◦ to …………,
◦ to public assistance in cases of unemployment, old age, sickness and disablement, and in other cases of undeserved want”.
The Art. 41, thus, gives direction to the State that in cases of Sickness, disablement and in other cases of undeserved want, the State is to provide “PUBLIC ASSISTANCE” . The State cannot, therefore, make provisions for “private assistance” and wash its hands of the affairs. The responsibility for Maternity relief was placed on the shoulders of the Government only as per Art. 42.

ESIC reviewed repeatedly

The scheme was made operational in 1952. Many Committees had reviewed the ESI Scheme periodically. They were: The ESIS Review Committee (1966), the Estimates Committee of Parliament (1969-70), the Committee on Perspective Planning (1972), the High Powered Committee on Amendments to the ESI Act (1978), the ESIS Review Committee (1982), Committee on Perspective Planning (1993) and The Report of the Working Group on Social Security for the Tenth Five Year Plan (2002-2007). The meeting of this Working Group said, as under in its Minutes dated 03.07.2001:

“There is need to take new initiatives to extend the spread and reach of the existing social security schemes being administered by the Employees’ State Insurance Corporation and Employees’ Provident Fund Organisation.“

Six Principles of Beveridge

Beveridge had codified Six Principles of Social Insurance. Two among them were the element of compulsory contribution from each insured person and his employer and the “Unification of Administrative Responsibility” through a single Social Insurance Fund. The report of Prof. Adharkar also emphasised the same. The Scheme in India is run by the Government to assure the insured population and the employers that the funds would be managed as per rules, the scheme would be run corruption-free and the defaulting employers and erring employers would be penalised by the State itself. That was a guarantee to other employers and employees that there would be equality in applying law. The grievance redress mechanism under any Government would be open and transparent.

Best financial management in ESIC

The Scheme had been run in a satisfactory manner, in spite of many negative actions of the corrupts and zombies, within the organisation and in the enforcing machinery of various State Governments. If the political leaders had been more committed in the welfare of the people, the Scheme could have done much better. Even in spite of all the pitfalls, the Scheme had been better managed financially than any other public sector autonomous body until the year 2007. Better than private units. The Economic times 05.02.2003 would testify to it.

Economic Times 5 2 2003 copy

Overbearing and misguiding bureaucracy

Any dilution of the the scheme would be challengeable successfully in Court of Law and would expose the Government having fallen victims to the misleading notes of the bureaucrats. Politicians falling victims to the bureaucracy had been brought out very clearly in the famous serial ‘Yes, Minister’. Indian scenario is not different in any manner. Occasions are numerous when the elected Ministers just sign on files as desired by the bureaucrats. India has seen many bureaucrats becoming Ministers and Prime Ministers too, only because the elected politicians could neither understand nor cope with the tactics used by the bureaucrats to bend them to the will of the latter.

During the discussion in the House of the People on 23.03.1992, Mr. A. B. Vajpayee blamed that the bureaucrats were more responsible for creating economic crisis than the political leadership. His statement is one of the many evidences available to prove that the Ministers are led and are not obeyed by the bureaucrats.

The following are the excerpts from the Indian Express dated 24.03.1992:
“Mr. Vajpayee hit out at the bureaucrats, five or six of them, who kept shuttling between the Prime Minister’s office, the North Block and the Planning Commission, and also the IMF, and said they were more responsible for creating the current economic crisis than the political leadership. These officers should not be entrusted with negotiating the Dunkel proposals at the GATT meetings, he cautioned”.

Intention is only to “reduce” benefits 

Private players are free to provide any kind of benefit that matches and surpasses the ones provided under the ESI Act. There is no need for any adventurous dilution of the provisions of ESI Act. There must be proper in-depth study before embarking on any such adventures. If needed, even a pilot project can be formulated and tested. The international experience on such privatisation must be examined. The information already received by the ILO on this issue was only in the negative about such privatisation. There should, therefore, be no reliance only on the filenotings of the bureaucrats to tamper with the existing system just in order to facilitate private players in social insurance. That would result in the private players playing havoc with the living conditions of the working population.

They enter into this field to make money, to prepare profit and loss account while the ESIC as a State machinery prepares Income and Expenditure account. Any hasty measure to allow private players by diluting the provisions of Exemptions under Sec. 87-91 would, clearly, prove that the intention of the rulers is only to reduce the quantum of benefits that are made available now to the working population in the organised sector.

Customer Satisfaction Survey

The Government of Gujarat had conducted a Customer Sastisfaction Survey among the public when Mr. Narendra Modi was Chief Minister of Gujarat in the early 2000s about the services rendered by various departments, as informed by Shri Hasmukh Adhia, IAS, Secretary, Administrative Reforms & training and Director General, SPIPA, Government of Gujarat, during his lecture in the Indian Institute of Managment, Ahmedabad.

Similar survey proposed in the year 2006 in the ESIC had not materialised. One such survey among the beneficiaries of the ESI Scheme would not be out of place, now, before venturing on misadventures. Gujarat Gas Company Limited conducted Customer Satisfaction Survey to understands its own strength and weaknesses.

Slide1

It was adjudged the best managed company of the year 2004-05 by the Business Today.

Slide2

Beveridge worked hard and conducted extensive study on various issues for one and a half years to prepar his monumental document and when it was made public,  he became a national hero overnight in the United Kingdom. In India, the bureaucrats do not show any intention to study the issues and impacts by conducting any study but work hard to demolish the scheme overnight.

A cursory survey had been conducted in Mumbai once in the 1990s. It showed that 85% of the employers wanted the scheme while 85% of the employers did not want it. The Regional Directors of Maharashtra would testify to it. So, any radical change in the concept and structue must be preceded, necessarily, by proper study and analysis from all angles.

ESIC can work wonders

We reiterate that as far as the ESIC is concerned the System is correct but the men need to change their attitude. That can be done, when the political leadership is committed to run the Scheme corruption-free. When done, ESIC can work wonders for the improvement of the nation’s economy and prove to the world that our nation is really a civilised nation.

What is more, India can even surpass many nations and reach the top in the Human Development Index. The Scandinavian countries top the Index at present, only because of social security measures which are run corruption-free. That is civilisation.

For more, read ‘Barbarism and Civilisation: History of Europe in our time – Bernard Wasserstein. 

Leave a comment

Filed under Administration, Amendment 2015, Benefits, For Trainees, International