Employees State Insurance Act – 1948 – Statutory Compliance
Applicability:- Any Establishment employing 10 or more persons are employed. However 20 Employees in Maharashtra and Chandigarh state.
The Establishments covered under the Act Shall continue even if the number of employees falls below subsequently.
Coverage:- Wages limit for coverage under the Act is Rs.21,000/- (Gross Wages excluding Overtime) per month.
Return:- Monthly Due Date:- 21st of Next Month
Registration:- FORM 1 within 15 days after the act becomes applicable to a unit or establishment for ESIC under the ESI Act 1948.
Rate of Contribution:- Total 4% Per Employees
Employee:- 0.75% of the gross wages excluding overtime
Employer:- 3.25% of the gross wages excluding overtime
Employee must be registered on ESIC portal within 10 days of his joining in the establishment. Every employee registered under ESIC is allotted an unique insurance Person Number (IP Number).
ESIC card is generated from the portal that is generally called E-Pehchan card.
Compliances:-
a) Online Registration through http://www.shramsuvidha.gov.in/home.
b) Monthly payment of contribution and filing of return through online https://esic.gov.in/.
c) Muster Roll, wages record and books of Account maintained under other laws.
d) Maintain Register of Accident Register in Form-11 & Inspection Book.
e) Accident report in Form-12, report immediately in fatal/death and in 48 hours in ordinary cases and immediately in death or serious injury cases.
Benefits:-
a) Medical Benefit:- Full medical care to an Insured person and his family members. No ceiling on expenditure on the treatment. Also provided to retired and permanently disabled insured persons and their spouses on payment of a token annual premium of Rs.120/-.
b) Sickness Benefit:- Cash compensation at 70% of wages to insured workers during certified sickness period for a maximum of 91 days in a year. Qualify for sickness benefit 78 days in a contribution period of 6 months is neccessary.
c) Maternity Benefit:- 26 weeks, which is extendable by further 1 month on medical advice at the rate of full wage subject to contribution for 70 days in the preceding 2 Contribution Periods.
d) Disablement Benefit:-
1) Temporary disablement benefit at the rate of 90% of wage is payable so long as the disability continues.
2) Permanent disablement benefit is paid at the rate of 90% of wage in the form of monthly payments. It depends on the extent of the loss.
e) Dependents Benefit:- Monthly payments to the dependents in cases where the death occurred due to occupational hazards or employment injury.
f) Funeral Expenses
g) Confinement Expenses
Penalty for Non-Compliance:-
a) Fails to pay the contribution within the time limit, shall be liable to pay simple interest at the rate of 12% per annum.
b) May levy and recover damages, Less than 2 months 5%, 2 to 4 months 10%, 4 to 6 months 15%, 6 months and above 25%.
EPF Act, 1952 – Statutory Compliance
Applicability:- Any Establishment employing 20 or more persons, registeration to be obtained within 1 month of attaining the strength.
The Establishments covered under the Act Shall continue even if the number of employees falls below subsequently.
Coverage:- Wages limit for coverage under the Act is Rs.15,000/- (Basic Wages + DA) per month.
Return:- Monthly Due Date:- 15th of Next Month
Rate of Contribution:-
Employee:- 12% of the salary
Employer:- 12% of the salary divided into two parts such as (3.67% of salary to EPF & 8.33% of salary to EPS).
Salary:- Gross Wages excluding HRA, Bonus, Overtime Allowance subject to a ceiling of Rs.15,000/-.
Withdrawals
a) EPF can be withdrawn completely in full settlements on attaining 58 years of age
b) if an employee remains unemployed for a period of 2 months or more or in the case of death while in service before attaining the age of retirement, in which case the nominees or legal heirs are entitled to withdraw the accumulated fund.
c) The partial withdrawal is available for educational opportunity, medical treatment, repayment of home loan, marriage, purchase of house.
Compliances:-
a) Online Registration through http://www.shramsuvidha.gov.in/home.
b) Monthly payment of contribution and filing of return through online https://unifiedportal-emp.epfindia.gov.in/epfo/.
c) Form 11 – Declaration Form for non deduction of EPF subject to fulfillment of terms and conditions.
d) Form 5A – Return of Ownership – Keep updated & Inspection Book
d) Filing of International Worker Return under EPF on monthly basis.
e) DSC and E-sign of authorized signatory should be registered on EPF portal for approval of employees records.
Benefits:-
a) The nominee will get maximum benefit to Rs.7 Lakh for the registered nominees in case of death of the employee. There is a bonus of Rs. 2,50,000/- available under the EDLI.
Important Note:-
a) A trainee or an intern is not an employee by the definition of the Act.
b) Member can contribute beyond the wage ceiling limit of Rs. 15,000. The total contribution i.e., voluntary + mandatory can be up to Rs.15,000 per month provided they get permission from the APFC/RPFC.
c) EPF do not have the option to opt out of the scheme once enrolled.
d) International Workers(IW) Return filing is mandatory.
Penalty for Non-Compliance:-
a) Late Payemnt of 12% per year interest for each day of delay in payment of contribution under Section 7Q.
b) Penal Damages for Late Payment under Section 14B, Less than 2 months 5% PA, 2 to 4 months 10% PA, 4 to 6 months 15%, 6 months and above 25%.
c) Liable to be arrested without warrants being a cognizable offence.
d) Defaults by employer in paying contributions attract imprisonment upto 3 years and fines upto Rs.10,000.
e) For any retrospective application, all dues have to be paid by employer with damages upto 100% of arrears.
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