Understanding Worker Compensation: Are Employees Earning Over 21000 Covered?

Dear All,

Kindly clarify if an employee receiving a salary of <= 21000 is covered under ESI, and if an employee receiving a salary >= 21000 is covered under GPA/GMC. Which employee is required to be covered for worker compensation? Is it mandatory or not? Please clarify.

Employees are covered under ESI if their monthly gross, excluding conveyance, is greater than 21,000/- per month. Employees with a monthly gross less than or equal to 21,000/- per month are covered under ESI.

Employee Compensation Act Coverage

Employees who are not covered under ESI should be covered under the Employee Compensation Act. GPA/GMC is not a statutory item but may be extended by the employer as an extra legal facility. If not covered under ESI, employees are automatically covered under the Employee Compensation Act. Nowadays, most employers are obtaining insurance instead of the EC Act to avoid liability in case of any incidents where compensation is awarded by the EC Commissioner. In the absence of insurance, the organization has to pay on their own.

S K Bandyopadhyay (WB, Howrah)
CEO-USD HR Solutions