Tag Archives: ESI

Labour Code: Letter No. 5 – Rule-making power of the State Governments !

Powers of the State Governments must be listed in an independent Section just like Sec. 165 which deals with the Powers of Central Government to make Rules.

Secondly, all the areas with reference to which powers must be conferred on the State Government must be enumerated, in a thoroughly exhaustive manner in the Code / Act itself.

Click on the image please for the contents !

Letter 5 for publishing

Letter 5 

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Filed under Labour Code 2017

Amendment 2010: The amazing Validation Clause

Action had been taken in the years 2008 and 2009 by the ESI Corporation for setting up large number of medical colleges. Parliament enacted law for this purpose only later in May, 2010 which came into effect from June, 2010.

Consultants were appointed for construction of buildings involving expenditure of thousands of crores of rupees.   Specialists / Professors were appointed to start medical colleges, with pay pockets of more than a lakh per month per person. The fee for the Consultant for setting up medical colleges was very huge.

All these things were beyond the powers conferred by the ESI Act and had been done without prior Parliamentary approval.

Although the Standing Committee meetings could usually be arranged even at short notice, expenditure of hundreds of crores of rupees was sanctioned without obtaining the prior approval of even the Standing Committee and those cases were placed before it later for ex-post facto approval.

Was the Parliament also, then, approached for ex-post facto approval?

If not, how were these actions regularised or validated?

Were these issues so urgent, at that point of time, that action had to be taken so early even when there was no provision in the Act?

An attempt was made by Mr. A. Veerappan to find out the truth.  If  you want to go through the amazing process of law-making in India, please click on the following link:

presentation-on-validation-clause

Mark you, Mr. Veerappan could make only an attempt.It would be helpful, if you could enlighten the public more on this issue.

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Filed under Amendments 2010, Powerpoints

Enigmatic Amendment 2011 that affects the Benefits

There was, all of a sudden, an amendment, which came into force from 01.07.2011, stating that it was intended to simplify the term ‘average daily wages’ mentioned  in Rule 2 (1) (1-A) of the ESI (Central) Rules, 1950.  The definition in this sub-rule is meant for regulating the rates of various Benefits provided under the Act while the definition in in sub-rule 1-B is for deciding coverage.

The need for such simplification, after the vigorous efforts to computerize all works of the Branch Offices is not clear. But, the fact is that that amendment has reduced the rates of benefits which were available to the insured population up to 30.06.2011.

After 01.07.2011,

  1. the employees receiving wages at the lower level like Rs. 5000 or Rs. 8000 etc., p.m. get less amount when they seek two benefits, Sickness and Maternity;
  2. the employees in higher income group get less amount of benefit only for Maternity;
  3. but, all of them get more benefits for Disablement.

Natural justice demands that no amendment should result in reduction of benefits, unless such reduction is actually contemplated and discussed openly before making such amendment.

Can there be reduction of benefits through indirect amendments without making the public aware of it through categorical proclamations, beforehand?

How can the bar under Sec. 61 of the ESI Act be justified, hereafter?

Readers are welcome to share their enlightened opinions!

Please Click on the small Presentation on Amendment that affects Benefits

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Filed under Amendments 2010, Benefits, Powerpoints

No time to read! So, ESIC got Medical Colleges.

“Why did the Congress bring the proceedings of the Lok Sabha to a stand-still for seven days over the issue of ….?” asks and justifies Ms. Girija Vyas in her article in http://www.congresssandesh.com/apr_issue/viewpoint1.html

That was when BJP was in power. Now a days, we see how BJP is also doing even more vigorously what the Congress was doing earlier.

Where is, then, the time for the MPs to read, study, understand, analyse and take a considered stand over the Bills placed before the House of the People for approval? Naturally, they do not have time.

The important Bills are just taken as read on the last day of the Session or simply ignored and taken to the next session. If people whose vote alone is essential for the Bills to become Law choose to remain indifferent or ignorant of the intricacies of the Bills and their votes are taken for granted on the last day of every session, with or without their being aware of it, who else can discuss the impact of a Bill?

Will there be any law to make all such Bills public and enable the Public to offer their opinion on the Lok Sabha website so that the points of view expressed therein are analysed on record and a report placed before the Lok Sabha so that the Members will be free from reading the Bills and will be free to stall the House.

Some solution, we have to find.

One such instance that shows what happened in the Lok Sabha  on 03.05.2010, when the Members did not have time to discuss the Bill because of the practice of stalling the proceedings of the House,  is analysed in the Powerpoint Presentation given hereunder. Please click on the links:

Presentation on Medical Colleges

Appendix I – Parliamentary Standing Committee report on Amendment Bill 2009

Appendix II – Parliament passed the bill

Readers are welcome to correct the mistakes, if any,or offer their viewpoints!

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Filed under Amendments 2010, Powerpoints

Inspection of factories

An article published in the Business Standard in December, 2010 brought out how the employees of the factories in Vellore felt that their legitimate rights would be protected only when the factories were inspected by the inspectors periodically. Long working hours, penalty for visit to toilets more than twice during a day, etc., were highlighted in that article.

As far as the ESIC is concerned, numerous cases of concealed employment are not detected because of absence of availability of information, lacunae in the Inspection Policy and lack of adequate number of Social Security Officers with reference to the actual work-load in such cases.

The ESIC has permitted the employers to register themselves online and get Employer’s Code Numbers generated. As a result, various kinds – repeat various kinds – of further problems have cropped up.

Monetary liability for the ESIC is, at present, created in respect of every TIC generated online by an employer or by a person posing as an employer even when the organisation is not sure whether the case is genuine and whether contribution as per rules would be forthcoming or not.

The EPFO is also facing only some of these problems. For more on this issue, please visit

http://www.business-standard.com/india/news/epfo-to-begin-endinspector-raj/466476/

But, the laxity in inspection does not  result in incorrect financial outgo as the EPFO pays benefits only with reference to the contribution paid, while the ESIC pays benefits not only on the basis of contribution paid but also on the basis of contribution payable but not paid.

The ESIC has not put in place adequate monitoring mechanism. The availability of man-power in the cadre of Social Security Officers is very very less when compared to the magnitude of the work in hand.

The government wants to do away with inspections, of course, for certain legitimate reasons. Please visit the following link:

http://www.thehindubusinessline.in/2002/12/14/stories/2002121402500100.htmB

But, controlling corruption and doing away with inspection are not synonymous. The government should also find a way and convince the working population how the problems faced by them would be located and solved.

Periodical and proper inspection of all factories and establishments will, alone, ensure coverage and protection of the workforce.

The very concept of compliance under the ESI Act is based on mutual trust and that was why the word ‘may’ is used instead of ‘shall’ in Sec. 45 (2) of the ESI Act, 1948.

But, the concept of Public Administration is “You do not get what you expect; you get only what you inspect’.

In other words, “Do not expect what you do not inspect”.

It would be helpful to the insured population if the inspection system of the ESI Corporation is streamlined to be ‘employee-friendly’ so that all employees are covered in time and contributions made to be paid on all items of wages as defined  under Sec. 2 (22) of the ESI Act, 1948.

ESI Corporation can ensure willing participation of labour in the making of the nation.

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