Why Do We Need a WC Policy If ESI Coverage Is Already in Place? Seeking HR Insights

Dear HR Friends,

I am working in a logistics company where we handle transportation work for Jindal, Tata, and Monnet. In their contract, it is mentioned that we have to provide WC policy for our employees along with ESI coverage for them.

Now, my question is, if we have already obtained ESI coverage, then why do we need to take out a WC policy? All the benefits of WC are covered under the ESI Act. Please suggest to me as this is very important for me.

Sadashiv
Manager-HR :icon1:

If the employees are covered by ESI, then there is no need to take a separate WC policy. However, for those employees who are not covered by ESI due to their salary exceeding Rs 10,000, it is advisable to opt for a Workmen Compensation policy.

Regards, Madhu.T.K

Thank you for the reply :)

Can I go for the WC policy only, because there is no ESI hospital nearby our site office? Under what conditions can the company be exempt from ESI?

Regards,
Sadashiv

If your area is notified as exempted from the operation of ESI, you will not be covered by the ESI Act. Whereas, if your area is covered by ESI, you cannot avail exemption unless you show that your employees are getting benefits better than that offered by the ESI Corporation. In ordinary circumstances, an employer may not be able to provide facilities offered by the ESIC, "though much of the facilities are confined only in papers."

In notified areas, ESI is mandatory regardless of the availability of ESI Hospitals in the area where the factory/establishment is set up. This is because ESI benefits are available not only to workers but also to family members who may be at a place distant from the factory where the IP is employed. It is not practical to set up dispensaries in such a way that all get easy access. However, dispensaries are available even in remote areas.

Regards,
Madhu.T.K