EPF (Employee Provident Fund 1952) - To promote retirement savings.
EPS (Employee Pension Scheme 1995) – Provides post-retirement savings.
EDLI (Employee Deposit Linked Insurance Scheme 1976) - Offers relief to family members in case of sudden death. Interest Rate: 8-9%.
Withdrawal Reasons - Medical emergencies, marriage, home loan, house construction.
The 10% rate is applicable for:
- Any establishment with fewer than 20 employees.
- Any sick industrial company declared as such by the Board for Industrial and Financial Reconstruction.
- Any establishment with accumulated losses equal to or exceeding its entire net worth at the end of any financial year.
- Any establishment in the following industries: (a) Jute (b) Beedi (c) Brick (d) Coir (e) Guar gum factories.
Contribution is rounded to the nearest rupee for each employee, covering the employee share, pension contribution, and EDLI contribution. The employer share is the difference between the employee share (payable as per statute) and pension contribution. The monthly payable amount under EPF administrative charges is rounded to the nearest rupee, with a minimum of Rs 500/- payable. Note: If the establishment has no contributory member in the month, the minimum administrative charge will be Rs 75/-. In case the establishment is exempted under the PF Scheme, inspection charges @0.18%, minimum Rs 5/- is payable in place of admin charges. In case the establishment is exempted under the EDLI Scheme, inspection charges @0.005%, minimum Re 1/- is payable in place of admin charges.
ESIC - Under Section 2(12), the ESI Act applies to all non-seasonal factories employing 10 or more persons. The State Government has extended the coverage under Section 1(5) of the Act to shops, hotels, restaurants, cinemas including preview theaters, road-motor transport undertakings, newspaper establishments, private medical institutions, educational institutions, and to contract and casual employees of municipal corporations/municipal bodies employing 10 or more persons in certain states/UTs, where the State Government is the appropriate government. The Central Government has extended the coverage under Section 1(5) to shops, hotels, restaurants, road motor transport establishments, cinemas including preview theaters, newspaper establishments, establishments engaged in insurance business, non-banking financial companies, port trusts, airport authorities, warehousing establishments employing 20 or more persons, where the Central Government is the appropriate government. The existing wage limit for coverage under the Act effective from 01.01.2017 is Rs.21,000/- per month (Rs.25,000/- per month in the case of persons with disability).
Contribution - The ESI Scheme being contributory in nature, all employees in the factories or establishments to which the Act applies shall be insured as provided by the Act. The contribution payable to the Corporation in respect of an employee shall comprise the employer's contribution and employee's contribution at a specified rate. The rates are revised from time to time. Currently, the employee's contribution rate (w.e.f. 1.07.2019) is 0.75% of the wages and that of the employer's is 3.25% of the wages paid/payable in respect of the employees in every wage period. Employees in receipt of a daily average wage up to Rs.176/- (w.e.f. 01.09.2019) are exempted from payment of contribution. Employers, however, will contribute their own share in respect of these employees.
Collection of Contribution - An employer is liable to pay his contribution in respect of every employee and deduct employees' contribution from the wages bill and shall pay these contributions at the above-specified rates to the Corporation within 15 days of the last day of the calendar month in which the contributions fall due. The Corporation has authorized designated branches of the State Bank of India and some other banks to receive the payments on its behalf.
Contribution Period and Benefit Period - There are two contribution periods each of six months duration and two corresponding benefit periods also of six months duration as under.
Contribution period Corresponding Cash Benefit period
1st April to 30th Sept. 1st January of the following year to 30th June.
1st Oct. to 31st March 1st July to 31st December of the year following.
Benefits - Section 46 of the Act envisages the following six social security benefits:
(a) Medical Benefit.
(b) Sickness Benefit (SB).
1. Extended Sickness Benefit (ESB).
2. Enhanced Sickness Benefit.
(c) Maternity Benefit (MB).
(d) Disablement Benefit.
1. Temporary Disablement Benefit (TDB).
2. Permanent Disablement Benefit (PDB).
(e) Dependent's Benefit (DB).
(f) Funeral Expenses.
An interesting feature of the ESI Scheme is that the contributions are related to the paying capacity as a fixed percentage of the workers' wages, whereas they are provided social security benefits according to individual needs without distinction.
Cash Benefits are disbursed by the Corporation through its Local Offices (LOs)/Mini Local Offices (MLOs)/Sub Local Offices (SLOs)/pay offices, subject to certain contributory conditions.
In addition, the scheme also provides some other need-based benefits to insured workers, including:
i. Rehabilitation allowance.
ii. Vocational Rehabilitation.
iii. Unemployment Allowance (Under Rajiv Gandhi Shramik Kalyan Yojana).
LWF (Labour Welfare Fund) - What is Labour Welfare Fund? Labour welfare is an aid in the form of money or necessities for those in need. It provides facilities to laborers to improve their working conditions, provide social security, and raise their standard of living. (Andhra Pradesh, Haryana, Karnataka, Tamil Nadu, etc.) And in some states, it is to be contributed during the month of June & December (Gujarat, Madhya Pradesh, Maharashtra, etc.).
To provide social security to workers, the government has introduced the Labour Welfare Fund Act. This act has been implemented in only 16 states out of 37 states, including union territories. The last date for the deduction of the contribution amount is 30 June and 31 December every year. Employers must file the returns to the Maharashtra Labour Welfare Board on or before 15 July and 15 January every year.
Maternity Benefits Act -1961 -
- She must be less than 80 days in the 12 months immediately preceding the date of her delivery.
- Given written notice to the employer about 7 weeks before the date of the delivery that she will be absent before & after her delivery.
- After delivery within 48 hours of childbirth, proof of pregnancy is required.
- In case of miscarriage - 6 weeks leave.
- Tubectomy operation - Leave with wages @ of maternity benefit for a period of 2 weeks.
- Nursing Breaks- 4 [Including rest interval].
- Increase of maternity benefit -
- Paid maternity leave increased to 26 weeks.
- Leave prior to the expected delivery date - 8 Weeks (2 Months).
- Leave after delivery - 18 weeks (4 Months).
Minimum Wages Act 1948 -
Rate of Wages - Revised from 1st Jan 2024 to 30th June 2024.
Skilled: 14700/- Per Month.
Semi-skilled: 13,924/- Per Month.
Unskilled: 13,089/- Per Month.
Minimum rate of wages. An Act to provide for fixing minimum rates of wages in certain employments. WHEREAS it is expedient to provide for fixing minimum rates of wages in certain employments;
1] Any minimum rate of wages fixed or revised by the appropriate Government in respect of scheduled employments under section 3 may consist of:
(i) a basic rate of wages and a special allowance at a rate to be adjusted, at such intervals and in such a manner as the appropriate Government may direct, to accord as nearly as practicable with the variation in the cost of living index number applicable to such workers (hereinafter referred to as the "cost of living allowance"); or
(ii) a basic rate of wages with or without the cost of living allowance, and the cash value of the concessions in respect of supplies of essential commodities at concession rates, where so authorized; or
(iii) an all-inclusive rate allowing for the basic rate, the cost of living allowance, and the cash value of the concessions, if any.
2] The cost of living allowance and the cash value of the concessions in respect of supplies of essential commodities at concession rates shall be computed by the competent authority at such intervals and in accordance with such directions as may be specified or given by the appropriate Government. Minimum time rate wages for piecework.- Where an employee is employed on piecework for which a minimum time rate and not a minimum piece rate has been fixed under this Act, the employer shall pay to such employee wages at not less than the minimum time rate. The appropriate Government may, by rules made under this Act, provide for the issue of wage books or wage slips to employees employed in any scheduled employment in respect of which minimum rates of wages have been fixed and prescribe the manner in which entries shall be made and authenticated in such wage books or wage slips by the employer or his agent.
The Payment of Wages Act, 1936 - The Payment of Wages Act, 1936 (Act) is essentially meant to benefit industrial employees who do not have very high salaries. It applies to all employees working in a factory or working through a sub-contractor or directly with the railway administration or those employed in the industrial sector as the Act specifies. In 2017, the Government of India increased the ceiling limit to Rs. 24,000 per month. This means that employees with wages up to the ceiling limit are covered under the Act.