Understanding ESI Exemption for Construction Workers: ESIC Regulations Explained

Dear All,

I am Gopi, and I am working in an infrastructure company as an Executive HR. I need your confirmation regarding ESI exemption for Building and Other Construction employees.

We are currently involved in a construction project in Villupuram, Tamil Nadu, and I would like to determine if Building and Other Construction employees are eligible for ESI. If they are covered under ESI, I need to know whether Villupuram is considered an exempted or non-exempted area.

As we have employed some supervisors and structured their salaries with ESI deductions, it is crucial to verify the applicability of ESI. If ESI does not apply, we will need to adjust their salary structure accordingly.

I would greatly appreciate it if you could provide clarification on this matter.

Regards,
Gopi

For the time being, employees at the site of construction companies are not covered under ESI. If the company itself has 20 or more regular employees (who sign the muster rolls of the company kept at the office), then only the company comes under the ESI Act. On the other hand, if the company does not have 20 or more regular employees but deputes different persons at their different sites and payments to these employees are made at such different locations, then such employees are not covered under the ESI Act.

Regards,
Madhu.T.K

Dear Mr. Madhu,

Thank you for your valuable reply. I have heard through discussions that Villupuram, Tamil Nadu, is considered a non-implemented area. Could you confirm if this information is accurate?

Exemption under Section 88 of the ESI Act is granted by the "Appropriate Government" to employees, or a class of employees, who are away from their headquarters for more than 7 months in a year, as well as to those employees who are posted in non-implemented areas.

I would like to verify if Villupuram falls under the non-implemented area category. If it does, how can I obtain the official notification for this designation? Could someone clarify and confirm this information?

Thank you.

Sections 87 and 88 discuss exemptions granted to certain factories or classes of persons. The ESI Act is implemented area-wise, and there are areas exempted from its operation. However, such exemptions may not be permanent and could be lifted after a certain period.

To determine whether Vallupuram is exempted or not, please contact the local office of the ESIC.

Regards,
Madhu T.K

Dear Sir,

Can we get some references for exemption of employees on the construction site as our auditors are not agreeing to the same? Also, what is the number of employees for a non-seasonal establishment using power, and how is it calculated? I mean, if the number of employees in a company is 50, whereas those drawing a salary less than 10,000 are only 5, does the establishment still need to get registered?

I am from Delhi.

Regards,
Gaurav

A non-seasonal establishment using power that employs fewer than 10 employees, whose salary does not exceed Rs 10,000, will not come under ESI. However, if it was covered once, then it will continue to be covered even if only one person is drawing less than Rs 10,000. For a new establishment with 50 employees, of which only 5 are drawing less than Rs 10,000, coverage will not be applicable. But for the coverage of the provident fund, the number of employees, irrespective of how many are drawing Rs 6,500 and less, is the criterion.

For your auditors' reference, I have attached a circular from ESIC.

Regards, Madhu.T.K

Hello,
My name is Nadiga. S.K. working for construction company in Bangalore.
We are executing one construction project at the below mentioned address.
TCS IT Park,
Plot No. G – 1,
Sipcot Industrial Estate,
Siruseri, Old Mahabalipuram Road,
Kanchipuram (District), CHENNAI
Tamilnadu State
Please let me know whether above specified area is covered under ESI or not. Because I tried through many sources but unable to get the details. Also can I have a copy of notification if yes. Also I would like to have a list of ESIC areas /names covered and non-covered areas in Tamilnadu.
Regards,
NADIGA.S.K.

Re: ESI Exemption - YES OR NO

Hello,

My name is Nadiga S.K., and I work for a construction company in Bangalore. We are currently working on a construction project at the following address:

TCS IT Park
Plot No. G - 1
Sipcot Industrial Estate
Siruseri, Old Mahabalipuram Road
Kanchipuram (District), CHENNAI
Tamil Nadu State

Please let me know if the above-specified area is covered under ESI or not. I have tried to find this information through various sources but have been unable to do so. If it is covered, could you please provide me with a copy of the notification? Additionally, I would like to request a list of ESIC areas/names that are covered and not covered in Tamil Nadu.

Regards,

This post was started in 2008! Now, the construction workers engaged at sites are also covered by ESI. This happened when the members started getting medical facilities on a anywhere basis.

Madhu.T.K

Dear Madhu ji,

Greetings of the Day.

With due respect to you, sir, may I ask on what grounds the construction workers engaged at sites are not covered by ESI?

Please go through my previous post which states that the post was started long back and then the construction workers engaged at the site were not covered by ESI, but now they are COVERED. The coverage is now given taking into consideration the online facilities and medical facilities made available PAN India basis.

Madhu.T.K

Dear Shri. Madhu ji,

Greetings of the day - SUNDAY. I am very sorry to bother you on this Sunday morning. With due respect, I wish to ask you, is there any notification, circular, or directives by the Corporation or by the Government affecting the change in the circular of the Corporation: Construction 4/99?

According to my knowledge, there is no such notification, circular, or directives. If you have any, please share it.

Dear Friends,

Please see the attached PowerPoint presentation on the BOCW Act salient features. It will be useful for everyone.

Regards,
PBS KUMAR

Superseding notification bringing the construction workers at the site under ESI is attached for your reference. Please find the attachment.

Regards, Madhu.T.K

Dear Madhu ji,
Thanks for your prompt response. I have gone thru your attachment, a letter to All RDs/Director/Jt. Directors by Jt. Director (Revenue).
In my view, it is incorrect to say that this letter supersedes the earlier decision of Corporation vide Instruction No. 4/99.
This letter says that the corporation has decided to revisit the Instruction No. 4/99 directed it’s officers to conduct survey in the first phase of Public Limited Companies engaged in construction activities in the implemented areas and submit a report latest by 31/1/2011.
I have following questions:
1. What has happened to this survey?
2. What is the report of this survey?
3. Is there any decision by Government or Corporation latter on the basis of survey report?
4. Can the Government or Corporation take such a big decision of crores of construction labours with the help of such kind of internal letter or circular?
I invite experts to discuss on this issue.

Yes, I too can agree with the kargonkar...

ESI has not yet finalized the extension of the scheme to the construction workers, as all categories of construction workers come under the unorganized sector. However, due to recent computerization, the benefits can be availed. I FEEL STILL THE ISSUE IS UNDER EXAMINATION ONLY.

If the Corporation wants to extend the same to construction workers, it's always better TO WAIVE THE LIMITATIONS OF GEOGRAPHICAL EXTENSION OF THE SCHEME. Only then will the real cause GET ITS FRUITS.

With best wishes...

Dear Madhujee,

As per the threads, kindly share ESIC Circular: A non-seasonal establishment using power, which employs fewer than 10 employees whose salary does not exceed Rs 10,000, will not come under ESI. But if it was covered once, then it will continue to be covered even if only one person is drawing less than Rs 10,000. However, for a new establishment which has 50 employees, of which only 5 are drawing less than Rs 10,000, coverage will not be there. But for coverage of provident fund, the number of employees irrespective of how many are drawing Rs 6,500 and less is the criterion.

For your auditors' reference, I attach a circular from ESIC.

Regards,
Madhu.T.K

Attached Files
File Type: doc ESI- Construction workers.doc
attribution https://www.citehr.com/111144-esi-ex...#ixzz2xM3IfTM2

For coverage of ESI, the number of employees employed, and not the number of employees drawing a salary less than the qualifying limit (Rs 15,000 - I think the post was very old when started) is to be taken into account. Therefore, if there are 50 employees, and none of them is receiving a salary of Rs 15,000, the establishment will still be covered under the ESI Act.

Madhu.T.K

Dear Madhu Sir,

Thank you for the reply. I apologize for bothering you based on your response regarding the scenario where there are 50 employees, none of whom are receiving a salary of 15000. Will the establishment still be covered under the ESI Act?

I kindly request you to share the ESIC Instruction Circular related to this matter.

Regards,
Azim Charania

New create the ESI IP that month hes sickness or accident his able taking benefits or not please suggest me

Corrected:
Can you please confirm if the ESI IP was created this month? In case of sickness or an accident, would he be able to avail of the benefits? Please advise.

Any freelance labor law consultant in Villupuram, please contact 9790368982.

Subject: Ineligibility for ESIC Coverage

Dear [Recipient's Name],

I am writing to inform you that you are not eligible for coverage under the Employees' State Insurance Corporation (ESIC) scheme. After a thorough review of your employment status and relevant documentation, it has been determined that you do not meet the criteria for ESIC benefits.

If you have any questions or require further clarification regarding this decision, please do not hesitate to reach out to the HR department. We are here to assist you and provide any necessary support during this process.

Thank you for your attention to this matter.

Sincerely,

[Your Name]
[Your Position]
[Company Name]