Umakanthan53
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Harsh Kumar Mehta
Consultant In Labour Laws/hr
Tushar.swar
Manager - Human Resource
Apex Management
Labour Laws Consultants
Korgaonkar K A
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Essykkr
Statutory Complaince/labour & Employment
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Thread Started by #pankaj kalia

Hello members,
i am in a manufacturing company.some of the workers and employees are under ESI Act, but their are also some employees and managers who are not covered under ESI because their wages are higher than ESI ceiling limit.Now my confusion is...Are they employees covered under compensation act or excluded from both Acts?
27th May 2014 From India
Dear Pankaj, who are not cover under ESIC, they are automaticaly applicable as per workmen compensation act. you need to cover them under the Mediclaim & Personal Accident policy.
27th May 2014 From India, Mumbai
Those who are not covered under ESI Act will not be automatically covered under EC Act.They will be covered under EC Act only if they falls under the definition of ' employee ' under the EC Act 1923.There is no law in India that employees outside the purview of ESI scheme should be covered under Medical/Personnel Accident insurance scheme.
Vaeghese Mathew
TVM -09961266966
27th May 2014 From India, Thiruvananthapuram
Sir(s),
The definition of term "employee" as laid down in section 2(1)(dd) read with Schedule -II of the Employees' Compensation Act, 1923 is a very long list of persons who are treated as "employees" and are entitled for compensation under said Act. State Govts. have also made some additions in the list.
In my opinion, it may be safe to conclude that those employees who are neither entitled as "employee" under Employees Compensation Act, 1923, nor under ESI Act, 1948 are not entitled for any compensation even though the accident may have occurred during and in the course of employment.
Perhaps such employees in such eventualities may have to approach civil courts by way of civil suits for compensation.
27th May 2014 From India, Noida
Other than ESI covered employees will be covered under the workmen's Compensation Act provided if they comes under workmen
definition of the Act.
You have to cover medical insurance for the safety of employer.
Otherwise, the employer is responsible for payment of compensation in case of employment injury/death.
It is always better to cover such employees under WC/Medical insurance.
27th May 2014 From India, Hyderabad
In my view, if an employee is neither covered by ESI Act nor by Emp..Comp. Act, it is advisable to cover them under accident policy of an insurance scheme, failing which the employer renders himself personally liable or the compensation, if the employee pursues the case before any Tribunal or Civil court.
B.Saikumar
In-House HR & IR Advisor

28th May 2014 From India, Mumbai
Sir(s),
I understand that the talk of providing of social security at the working place to the employees not covered either in ESI Act, 1928 or under EC Act, 1923 is actually non-existent. It entirely depends upon the discretion of the employer/management whether to pay the compensation or not. To file a case in any civil court and continue contesting the same is a difficult task and further if employer proves negligence or any short-coming at the level of injured officer/employee, he will get no compensation.
28th May 2014 From India, Noida
Dear all,
A employee falling under the definition of workmen under the Workmen Compensation Act, drawing wages/salary beyond ceiling limits i.e; Rs.15,000/- will definitely entitled for compensation if the injury / death caused during the course of employment.
It is the sole discretion of the management to obtain insurance cover for such employees to avoid any legal financial liability at any stage. There is a provision to obtain policy for gratuity under the payment of gratuity act.
28th May 2014 From India, Delhi
Employyes drwing Rs 15000 or more are not eligible for ESIC. They can be covered under EC/WC Policy in case of ESIC jurdiction notified area. In case of non notified area all should be covered under WC/EC.
28th May 2014 From India, Mumbai
Thanks for your valuable replies but their is one more think which i have forgot to mention above that is...the company is also giving them medical in their salary breakups.Now are they eligible or not for compensation?
28th May 2014 From India
Giving medical allowance or its reimbursement is not an excuse for denying compensation under EC Act.After the 2010 amendment to EC Act the employer shall reimburse the medical expenses incurred by the employee meeting with employment injury ,in addition to the amount of compensation.
Varghese Mathew
28th May 2014 From India, Thiruvananthapuram
You have to get exemption from ESIC office/govt. in that case.Normally if any organsation gives better facilities more than ESIC then only they get exemption order. Otherwise ESIC is mandatory.
28th May 2014 From India, Mumbai
Dear all,
Employee in implemented areas may not be coverable under ESI Act due to 2 reasons: 1) the org manpower is low (10 for factory / 20 for others) and as such it is not coverable, 2) if the manpower is more and employee draws wages in excess of Rs. 15000 per month either at time of joining or at beginning of new contribution period.
Liabilities of likely accidents of such employees will have to be covered by ONLY obtaining Employee Compensation policy; accident policy /medi-claim policy may not be able to cover the liabilities. The policy can be discussed with any general insurance company.
Employee Compensation Act is about compensating for loss of earning capacity due to an accident, it goes beyond mere cost of medical treatment due to an accident. As such accident policy /medi-claim policy may not be adequate to cover cost of compensation to be paid.
Shrikant Prabhudesai

29th May 2014 From India, Mumbai
People have inappropriate preceptions that wherein ESI Act is applicable EC Act is not applicable. this is not the case, both Acts are applicable.

for employees covered under ESI Act ( having 15K salary) & EC Act, the employee only can claim compensation in either of one Act. Due to the bar imposed by section 61 under ESI Act, meaning thereby those employee covered by ESI Act can not claim similar benefit which he has been entitled in any other applicable law means EC Act or any other.

the real issue is not applicability but bar on claiming compensation. That the reasaon employee covered under ESI Act in ESI implemented area are kept out of perview of EC Act ( means EC policy).

in my view post 2010 amendemnt in EC Act as earlier it was WC Act wherein word "workman" has been replaced by "Employee", and due to other major changes it became applicable to all employees irrespective of designation.

Secondly GPA/Medical Policy are not valid from EC Act point of view, the employee need to go for EC Policy. Though the Act does not mandatorly precribed for Insurance Policy but to shift self liability and avoid risk of huge payment , it is always advisable to have EC Policy.

So for such employee those are not covered under ESI Act either due to non implemented area of ESI or due to out of salary coverage better to have a blanket coverage under EC Policy.
30th May 2014
Dear Sh.Essykkr,
In your remarks ,as above, you have mentioned the provisions of Section 61 of ESI Act and stated that "People have inappropriate preceptions that wherein ESI Act is applicable EC Act is not applicable. this is not the case, both Acts are applicable".
In this connection, I will like to point out that under section 53 of the said Act there is specific bar against receiving benefits under Employees' Compensation Act, 1923.
You have further stated that"in my view post 2010 amendemnt in EC Act as earlier it was WC Act wherein word "workman" has been replaced by "Employee", and due to other major changes it became applicable to all employees irrespective of designation".
In this connection, I may submit that under Employees' Compensation Act, 1923 only those employees are entitled for compensation who have been defined as "employee" under section 2(dd) and Schedule-II of said Act and not all employees as mentioned by you.
30th May 2014 From India, Noida
sorry section 53 of ESI Act accidently left out or could not point out.
For applicability of EC Act as mentioned by you shall be as per schedule appended but here is difference of opinion in legal fratinity have discussed this issie number times with consultans and senior they said it applicable to all otherwise what the essence of word employee instead of workmen people in industry though i am also of the view earlier without amendment in schedule its not correct to say that it cover all employee irresptive of designation.
would request other fellow members to through some light on this. its matter of debate..because ptherwisw what was the use changing its name or what was intension of the legislatures. aAs its name suggest and keeping in view of BPO IT ITES companies changing work force senerio it was amended.
anyway lets have clear view of others.
30th May 2014
When the EC Act defines "employee" and schedule II gives the list of such employees why legal fraternity have doubt?If the intention of legislature was to cover all employed person other than IPs it could have framed such definition and repeal schedule II.
Varghese Mathew
30th May 2014 From India, Thiruvananthapuram
As Mr.Harsh kumar and Verghese Mathew pointed out, there is no confusion as to coverage of employees under EC Act. It is only those employees that are employed in those capacities as explained in Schedule II to the Act that are covered but not all employees.since the Schedule II to amended Act extends coverage to more employees than those under the old Schedule, the Act was renamed as Employees Compensation Act to reflect this extended coverage.
B.Saikumar
In-House HR & IR Advisor

31st May 2014 From India, Mumbai
Would like to know , if a person working in company in marketing dept, is entitled to get any compensation for the accidents occurred during the course of performing his duties (traveling for company's work), and he is not covered under ESI.
Thanks
Annon
3rd June 2014 From India, Ghaziabad
Dear Annon,
Yes, such employee is entitled to receive compensation as per provisions of Employee Compensation Act, 1923, the act was earlier known as Workmen's Compensation Act, 1923.
It is essential for such org to cover such liabilities by obtaining Employee Compensation Policy available with any general insurance companies. Should a young employee meet with a serious accident, the payment of compensation may run into lakhs of rupees as such salaries would be Rs. 15000 + per month.
ESIC continues to pay pension to nominees every month as per rules, whereas here it is one time payment based on loss of earning capacity as detailed in the Act.
Shrikant

3rd June 2014 From India, Mumbai
The author of the thread has clearly mentioned that they are into Manufacturing Industry meaning thereby they are covered by the definition of Factories Act and will fall under Schedule II clause (ii) and also would like to produce the same a below-
The following persons are employees within the meaning of section 2(i)(dd)] and subject to the provisions of that section, that is to say, any person who is—
(ii) employed, in any premises wherein or within the precincts whereof a manufacturing process as defined in clause (k) of section 2 of the Factories Act, 1948 (63 of 1948), is being carried on, or in any kind of work whatsoever incidental to or connected with any such manufacturing process or with the article made 8[whether or not employment in any such work is within such premises or precincts], and steam, water or other mechanical power or electrical power is used; or
Now please carefully read both the clauses it is clear the definition is ANY PERSON WHO IS EMPLOYED. the word Employed has been used in both the clauses, which mean any person employed. Are managers/suprevisors etc are not employed.
Earlier the definition used to be "Workman" means under 2(n) (old Act).
So my point is as far as employment category covered under Schedule II, in such categories, all employees are covered irrespective of their designation .
3rd June 2014
Dear friends,

I very much appreciate the valuable and logical inputs offered by all the responding members though some points seem unacceptable to me. The question is whether the Employees Compensation Act,1923 is applicable to those employees including managerial cadre personnel not covered by the ESI Act in the event of employment accidents.In this regard, I am in complete agreement with Varghese Mathew.If we analyse the preamble of the E.C Act with reference to the Statement of Objects and Reasons, "the Act has its roots in charity, sympathy and the advancement of socialistic ideas" as observed by the Hon'ble High Court of Allahabad in Works Manager, Carriage & Wagon Shop,EIR v. Mahabir ( AIR 1954 All 132 ).How ever, the Act limits its application to the employees based on their vulnerability or risk of exposure to employment accidents in general. Hence the definition of 'employee' with reference to the list enumerated in the Schedule II.We have to bear in mind that the list furnished in the Schedule is not illustrative BUT exhaustive.
8th June 2014 From India, Salem
If the 'manager' is in the manufacturing sector coming under the Factories Act ,he is an employee under Employees Compensation Act ( if he is not covered under ESI Act) and is eligible for compensation for employment injury.

9961266966
8th June 2014 From India, Thiruvananthapuram
Those who are not covered under ESI Act will not be automatically covered under EC Act. They will be covered under EC Act only if they falls under the definition of ' employee ' under the EC Act 1923. One more thing for calculating compensation maximum wages will be Rs. 8000-.
J.K. Pamnani
12th June 2014 From India, New Delhi
They are eligible for compensation even company is giving them medical in their salary breakups.
12th June 2014 From India, New Delhi
Dear Tushar ji,
I hope, you will correct yourself after reading the comments of senior learned members.
The liability under the EC Act can not be met by mediclaim policy or personal accidental policy. Only EC policy will come to your rescue in liability under EC Act as mentioned by Shrikant Prabhudesai.
13th June 2014 From India, Mumbai
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