Employees' State Insurance (Amendment) Act, 2010 [Repealed]
[Repealed by Act 23 of 20162]
Be it enacted by Parliament in the Sixty-first Year of the Republic of India as follows
Prefatory Note Statement of Objects and Reasons. The Employees' State Insurance Act, 1948 is a social security legislation that provides for certain benefits to employees in case of sickness, maternity and employment injury and to make provisions for certain other matters in relation thereto.
2. Keeping in view the changing needs of medical insurance and also to take care of the shift towards providing medical care to unorganised sector workers, it was considered that the Employees' State Insurance Corporation being the premier social security agency running a health care scheme in the country, must come forward to participate in the Rashtriya Swasthya Bima Yojana to cover Below Poverty Line workers in the unorganised sector. The Rashtriya Swasthya Bima Yojana Scheme had already become operational with effect from 1-4-2008. The Scheme had picked up momentum. Almost all the States had agreed to implement the Scheme and a majority of them had already advertised for the implementation of the same. More than 1.25 lakh smart cards had been issued by 15-6-2008. The number at present had risen to over 54 lakhs. Some recipients of these cards had already been assisted by way of hospitalisation. It was, therefore, considered essential and urgent to enable the Employees' State Insurance Corporation to participate in the Scheme with immediate effect. By providing health services to the unorganised sector workers under the Rashtriya Swasthya Bima Yojana Scheme, both unorganised sector workers and the Employees' State Insurance Corporation would benefit by the Employees' State Insurance Corporation making available its vast network of hospitals for providing medical care on user charges, wherever the same were underutilised. In view of the urgency as pointed out above, the Employees' State Insurance (Amendment) Ordinance, 2008 was promulgated on the 3rd July, 2008. To replace the said Ordinance, the Employees' State Insurance (Amendment) Bill, 2008 was introduced in Parliament on 21-10-2008 and the same was referred to the Department-related Parliamentary Standing Committee on Labour for examination and report. The Committee presented its report on the 19th December, 2008. The Committee agreed in principle the provisions of the said Bill. However, it made certain recommendations for improvement in the proposed Scheme. However, due to the dissolution of the Fourteenth Lok Sabha, the said Bill lapsed.
3. In the meantime, the Sub-Committee constituted by the Employees' State Insurance Corporation to review the existing provisions of the said Act keeping in view the changed economic scenario had recommended comprehensive amendments in the said Act. In view of the above, it is considered necessary to bring the provisions of the said lapsed Bill and the recommendations of the said Sub-Committee in the proposed legislation. Hence, the present Bill.
4. The salient features of the Bill are as follows
(i) it enhances the age limit from the existing eighteen years to twenty-one years for the purpose of giving benefits to dependants;
(ii) it includes an apprentice appointed under the standing orders as an employee for the purpose of this Act;
(iii) it provides benefits to workers for the accidents happening while commuting to the place of work and vice versa;
(iv) it enables the Central Government to make rules to decide dependency of the parents on the basis of income;
(v) it provides for a new definition of factory to provide that when ten or more persons are employed or were employed in the preceding twelve months irrespective of the use of power;
(vi) it empowers the Central Government to include the Director General of Employee's State Insurance Corporation as the ex officio Chairman and Director General, Health Services as the ex officio Co-Chairman in the Medical Benefit Council;
(vii) it provides for cessation of membership of the Employees' State Insurance Corporation for member of Parliament when he becomes Minister or Speaker or Deputy Speaker of the House of the People or Deputy Chairman of the Council of State or when he ceases to be a member of Parliament;
(viii) it enables the Employees' State Insurance Corporation to appoint consultants and specialists on contract without referring the matter to the Central Government for better delivery of super-speciality services;
(ix) it increases public accountability by valuation of assets once in three years from existing once in five years;
(x) it re-designates the Insurance Inspector as Social Security Officer;
(xi) it simplifies the determination of employer's contribution;
(xii) it empowers the Central Government to specify by rules the other conditions for medical treatment of an insured person who retires under Voluntary Retirement Scheme or takes premature retirement;
(xiii) it empowers the Employees' State Insurance Corporation to enter into an agreement with any local authority, local body or private body for commissioning or running ESI hospitals through third party participation for providing medical treatment and attendance to insured persons; and
(xiv) it improves the quality of its service delivery and raises infrastructural facilities by opening medical colleges and training facilities in order to increase its medical and para-medical staff.
5. The Bill seeks to achieve the above objectives.
Section 1. Short title and commencement
(1) This Act may be called the Employees' State Insurance (Amendment) Act, 2010.
(2) Section 18 shall be deemed to have come into force on the 3rd day of July, 2008 and the remaining provisions of this Act shall come into force on such date3 as the Central Government may, by notification in the Official Gazette, appoint.
Section 2. Amendment of Section 1
In the Employees' State Insurance Act, 1948 (hereinafter referred to as the principal Act) (34 of 1948), in Section 1, in sub-section (5), for the words six months , the words one month's shall be substituted.
Section 3. Amendment of Section 2
In Section 2 of the principal Act,
(A) in clause (6-A),
(a) for sub-clause (i), the following sub-clause shall be substituted, namely
(i) a widow, a legitimate or adopted son who has not attained the age of twenty-five years, an unmarried legitimate or adopted daughter, ;
(b) in sub-clause (ii), for the words eighteen years , the words twenty-five years shall be substituted;
(B) in clause (9), for the words or under the standing orders of the establishment; , the words and includes such person engaged as apprentice whose training period is extended to any length of time shall be substituted;
(C) in clause (11), for sub-clause (v), the following sub-clauses shall be substituted, namely
(v) dependant parents, whose income from all sources does not exceed such income as may be prescribed by the Central Government;
(vi) in case the insured person is unmarried and his or her parents are not alive, a minor brother or sister wholly dependant upon the earnings of the insured person; ;
(D) for clause (12), the following clause shall be substituted, namely
(12) factory means any premises including the precincts thereof whereon ten or more persons are employed or were employed on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on or is ordinarily so carried on, but does not include a mine subject to the operation of the Mines Act, 1952 (35 of 1952) or a railway running shed; .
Section 4. Amendment of Section 10
In Section 10 of the principal Act, in sub-section (1), for clauses (a) and (b), the following clauses shall be substituted, namely
(a) the Director General, the Employees' State Insurance Corporation, ex officio as Chairman;
(b) the Director General, Health Services, ex officio as Co-Chairman; .
Section 5. Amendment of Section 12
In Section 12 of the principal Act, for sub-section (3), the following sub-section shall be substituted, namely
(3) A person referred to in clause (i) of Section 4 shall cease to be a member on becoming a Minister or Speaker or Deputy Speaker of the House of the People or Deputy Chairman of the Council of States or when he ceases to be a member of Parliament. .
Section 6. Amendment of Section 17
In Section 17 of the principal Act, in sub-section (2), in clause (a), after the proviso, the following proviso shall be inserted, namely
Provided further that this sub-section shall not apply to appointment of consultants and specialists in various fields appointed on contract basis, .
Section 7. Amendment of Section 37
In Section 37 of the principal Act, for the words five years , the words three years shall be substituted.
Section 8. Amendment of Section 45
In Section 45 of the principal Act,
(a) for the words Inspectors and Inspector , wherever they occur, the words Social Security Officers and Social Security Officer shall respectively be substituted;
(b) after sub-section (3), the following sub-section shall be inserted, namely
(4) Any officer of the Corporation authorised in this behalf by it may, carry out re-inspection or test inspection of the records and returns submitted under Section 44 for the purpose of verifying the correctness and quality of the inspection carried out by a Social Security Officer. .
Section 9. Amendment of Section 45-A
In Section 45-A of the principal Act, in sub-section (1),
(i) for the word Inspector , the words Social Security Officer shall be substituted;
(ii) after the proviso, the following proviso shall be inserted, namely
Provided further that no such order shall be passed by the Corporation in respect of the period beyond five years from the date on which the contribution shall become payable. .
Section 10. Insertion of new Section 45-AA
After Section 45-A of the principal Act, the following section shall be inserted, namely
45-AA. Appellate Authority. If an employer is not satisfied with the order referred to in Section 45-A, he may prefer an appeal to an appellate authority as may be provided by regulation, within sixty days of the date of such order after depositing twenty-five per cent, of the contribution so ordered or the contribution as per his own calculation, whichever is higher, with the Corporation:
Provided that if the employer finally succeeds in the appeal, the Corporation shall refund such deposit to the employer together with such interest as may be specified in the regulation. .
Section 11. Amendment of Sections 51-A and 51-B
In the principal Act, in Sections 51-A and 51-B, for the words an insured person's , the words an employee's shall be substituted.
Section 12. Amendment of Sections 51-C and 51-D
In the principal Act, in Sections 51-C and 51-D, for the words insured person , the word employee shall be substituted.
Section 13. Insertion of new Section 51-E
After Section 51-D of the principal Act, the following section shall be inserted, namely
51-E. Accidents happening while commuting to the place of work and vice versa. An accident occurring to an employee while commuting from his residence to the place of employment for duty or from the place of employment to his residence after performing duty, shall be deemed to have arisen out of and in the course of employment if nexus between the circumstances, time and place in which the accident occurred and the employment is established. .
Section 14. Amendment of Section 56
In Section 56 of the principal Act, in sub-section (3), for the third proviso, the following proviso shall be substituted, namely
Provided also that an insured person who has attained the age of superannuation, a person who retires under a Voluntary Retirement Scheme or takes premature retirement, and his spouse shall be eligible to receive medical benefits subject to payment of contribution and such other conditions as may be prescribed by the Central Government. .
Section 15. Amendment of Section 58
In Section 58 of the principal Act, after sub-section (4), the following sub-sections shall be inserted, namely
(5) The State Government may, in addition to the Corporation under this Act, with the previous approval of the Central Government, establish such organisation (by whatever name called) to provide for certain benefits to employee in case of sickness, maternity and employment injury:
Provided that any reference to the State Government in the Act shall also include reference to the organisation as and when such organisation is established by the State Government.
(6) The organisation referred to in sub-section (5) shall have such structure and discharge functions, exercise powers and undertake such activities as may be prescribed. .
Section 16. Amendment of Section 59
In Section 59 of the principal Act, after sub-section (2), the following sub-section shall be inserted, namely
(3) The Corporation may also enter into agreement with any local authority, local body or private body for commissioning and running Employees' State Insurance hospitals through third party participation for providing medical treatment and attendence to insured persons and where such medical benefit has been extended to their families, to their families. .
Section 17. Insertion of new Section 59-B
After Section 59-A of the principal Act, the following section shall be inserted, namely.
59-B. Medical and para-medical education. The Corporation may establish medical colleges, nursing colleges and training institutes for its para-medical staff and other employees with a view to improve the quality of services provided under the Employees' State Insurance Scheme. .
Section 18. Substitution of new chapter for Chapter V-A
For Chapter V-A of the principal Act, the following chapter shall be substituted, namely
Chapter V-A
73-A. Definitions. In this chapter,
(a) other beneficiaries means persons other than the person insured under this Act;
(b) Scheme means any Scheme framed by the Central Government from time to time under Section 73-B for the medical facility for other beneficiaries;
(c) underutilised hospital means any hospital not fully utilised by the persons insured under this Act;
(d) user charges means the amount which is to be charged from the other beneficiaries for medical facilities as may be notified by the Corporation in consultation with the Central Government from time to time.
73-B. Power to frame Schemes. Notwithstanding anything contained in this Act, the Central Government may, by notification in the Official Gazette, frame Scheme for other beneficiaries and the members of their families for providing medical facility in any hospital established by the Corporation in any area which is underutilised on payment of user charges.
73-C. Collection of user charges. The user charges collected from the other beneficiaries shall be deemed to be the contribution and shall form part of the Employees State Insurance Fund.
73-D. Scheme for other beneficiaries. The Scheme may provide for all or any of the following matters, namely
(i) the other beneficiaries who may be covered under this Scheme;
(ii) the time and manner in which the medical facilities may be availed by the other beneficiaries;
(iii) the form in which the other beneficiary shall furnish particulars about himself and his family whenever required as may be specified by the Corporation;
(iv) any other matter which is to be provided for in the Scheme or which may be necessary or proper for the purpose of implementing the Scheme.
73-E. Power to amend Scheme. The Central Government may, by notification in the Official Gazette, add to, amend, vary or rescind the Scheme.
73-F. Laying of Scheme framed under this chapter. Every Scheme framed under this chapter shall be laid, as soon as may be after it is made, before each House of Parliament while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the Scheme or both Houses agree that the Scheme should not be made, the Scheme shall thereafter have effect only in such modified form or to be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that Scheme.'.
Section 19. Validation
All things done, or, omitted to be done, and all actions or measures taken or not taken during the period beginning on or after the 3rd day of July, 2008 and ending immediately before the date of commencement of the Employees' State Insurance (Amendment) Act, 2010, shall insofar as they are in conformity with the provisions of this Act, as amended by the Employees' State Insurance (Amendment) Act, 2010, be deemed to have been done, or taken, or not taken, under the provisions of this Act, as amended by the Employees' State Insurance (Amendment) Act, 2010, as if such provisions were in force at the time such things were done or omitted to be done and actions or measures taken or not taken during the said period.
Section 20. Amendment of Section 87
In Section 87 of the principal Act, the following provisos shall be inserted at the end, namely
Provided that such exemptions may be granted only if the employees in such factories or establishments are otherwise in receipt of benefits substantially similar or superior to the benefits provided under this Act:
Provided further that an application for renewal shall be made three months before the date of expiry of the exemption period and a decision on the same shall be taken by the appropriate Government within two months of receipt of such application. .
Section 21. Amendment of Section 91-A
In Section 91-A of the principal Act, for the words either prospectively or retrospectively , the word prospectively shall be substituted.
Section 22. Insertion of new Section 91-AA
After Section 91-A of the principal Act, the following section shall be inserted, namely
91-AA. Central Government to be appropriate Government. Notwithstanding anything contained in this Act, in respect of establishments located in the States where medical benefit is provided by the Corporation, the Central Government shall be the appropriate Government. .
Section 23. Amendment of Section 95
In Section 95 of the principal Act, in sub-section (2),
(i) after clause (ef), the following clause shall be inserted, namely
(eff) the income of dependant parents from all sources; ;
(ii) after clause (eh), the following clause shall be inserted, namely
(ehh) the conditions under which the medical benefits shall be payable to the insured person and spouse of an insured person who has attained the age of superannuation, the person who retires under Voluntary Retirement Scheme and the person who takes pre-mature retirement; .
Section 24. Amendment of Section 96
In Section 96 of the principal Act, in sub-section (1), after clause (e), the following clause shall be inserted, namely
(ee) the organisational structure, functions, powers, activities and other matters for the establishment of the organisation; .
Section 25. Amendment of Section 97
In Section 97 of the principal Act, in sub-section (2),
(i) in clause (xx), for the word Inspectors , the words Social Security Officers shall be substituted;
(ii) after clause (xx), the following clause shall be inserted, namely
(xxa) the constitution of the appellate authority and the interest on amount deposited by the employer with the Corporation. .
1 Received the assent of the President on 24-5-2010 and published in the Gazette of India, Extra., Part II, Section 1, dated 25-5-2010, pp. 1-6, No. 23.
2 Ed.: Act 18 of 2010 repealed by Act 23 of 2016, S. 2 & Sch. I. See also S. 4 of the Repealing and Amending Act, 2016: 4. Savings. The repeal by this Act of any enactment shall not affect any other enactment in which the repealed enactment has been applied, incorporated or referred to; and this Act shall not affect the validity, invalidity, effect or consequences of anything already done or suffered, or any right, title, obligation or liability already acquired, accrued or incurred, or any remedy or proceeding in respect thereof, or any release or discharge of or from any debt, penalty, obligation, liability, claim or demand, or any indemnity already granted, or the proof of any past act or thing; nor shall this Act affect any principle or rule of law, or established jurisdiction, form or course of pleading, practice or procedure, or existing usage, custom, privilege, restriction, exemption, office or appointment, notwithstanding that the same respectively may have been in any manner affirmed or recognised or derived by, in or from any enactment hereby repealed; nor shall the repeal by this Act of any enactment revive or restore any jurisdiction, office, custom, liability, right, title, privilege, restriction, exemption, usage, practice, procedure or other matter or thing not now existing or in force.
3 1-6-2010, vide S.O. 1296(E), dated 1-6-2010.