Handling Employee Benefits and Settlements After a Natural Death: What Should Be Included?

Hi,

Please let me know about the benefits to be given to an employee in case of their natural death. I have to proceed with the full and final settlement of the said employee. Kindly let me know the points to be considered while calculating the full and final amount.

Thank you.

Please give details about Employer - Type of Organization, Registered under Which Act? What are the laws presently applied?

Please give details about Natural Death?

Please give details about deceased Employee - DOJ, DOL, Covered under EPF/ESI?

Understanding Benefits Under the ESI Act, 1948

1. As far as the ESI Act, 1948, and the Employees' Compensation Acts are concerned, the dependants' benefit or amount of compensation is payable only if the death or accident is due to an employment injury out of or in the course of employment. The definition "out of or in the course of employment," I think, also includes death due to occupational diseases as defined and laid down in the said Acts. The term "occupational disease" is also associated with the minimum requirement of employment of the employee in a particular type of trade as defined in the said Acts.

2. In the case where the deceased employee was covered under the ESI Act, 1948, his family members can claim reimbursement of expenses for the funeral up to the limit from ESIC as laid down under the said Act.

Dear Mr. Upendra,

As suggested by learned members, if it is a natural death, then no compensation arises against the Employees' Compensation Act. You need to inform the death to the Local ESI Office (in the prescribed form), and the dependent family can get the Funeral Expenses amount from the ESI.

In addition to the above, while making the full and final settlement, please note the following:

Compulsory Payment (to be paid by the organization):

1. His total unpaid salary
2. Amount of unpaid Bonus
3. Amount of unpaid Earned Leave
4. Amount of Gratuity (to be calculated until the age of his retirement. However, if you have taken LIC against the Gratuity nomination, then the gratuity will be paid by the LIC).

Optional Payment (to be paid by the organization):

1. If the children are young, the company can make some FD in the name of the children (in the case of a girl child, the amount can be increased).
2. Staff Voluntary Contribution for the family.
3. Employment (direct or through a contractor). If the member’s wife is capable of doing any type of job, she may be given employment.

We have provided all the above optional benefits for our employee.

Statutory Compensation:

1. Payment from ESI against Funeral Expenses.
2. Payment to the NOK against Life Insurance (Through the EDLI scheme of PF).
3. PF Contribution of the member to be given to the NOK.
4. Pension for the Wife and eligible Children (Family).

Please note, in regard to the Statutory Compensation, there are fixed processes that need to be complied with properly. So please be careful while processing the claims. In order to get the benefits (claims) in a timely manner, you can seek some consultant’s services.

Hope you will find my clarification as per your requirement. Experienced members can shed more light on the matter.