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Mohan Durairaj

We are a contractor firm doing major Mechanical & Electrical projects at IOCL, BPCL in various outskirt places of India. Maximum No. of Employees are paid PF as well as ESI. PF is possible to claim in future so we are not bother about it, but we are unable to benefit the ESI due to employees engaged from various states to various projects location.
For this such business, please guide us whether ESIC is mandatory or not? If mandatory, whether it is applicable at all private hospital ?
Whether Medical Bills from outside hospital is claimable through ESIC?

From India, Trichy

The ESI is mandatory as per teh act and it is more help full if the employees need treatment in lakhs , nowadays u know how expensive is the hospitalization. expenditure.
it is benefit ..never agree that Esi is not useful.
u can clam the bill in the ESI u will get the reimbursement amount this felicity is also available .
cover under Esi thous are in limit of ESI

From India, Hyderabad

If your employee is exceeding 20 (and in your case from the business you are carrying it seems you have definitely more than 20), it is applicable
In your case, as employees are in more than one location, you have to take a main code for registered office and sub code for each region which is very simple now.
ESIC is a social security insurance and helpful for your organisation in various aspect such as maternity benefit, Industrial Dispute Act, Payment of Wages Act and in Employee Compensation Act (Earlier Workmen's compensation Act)
There are penalties and harassment from labour inspector as well as ESIC inspector for not complying with it so better you should go ahead.
The worst part is, more you delay, the bribe amount as well as retrospective coverage with interest is very costly so comply as early as possible.

From India, Mumbai
Harsh Kumar Mehta

It has been mentioned that the employees are working at various outskirit places. It has not been confirmed whether such employees are working at such places which are implemented areas as notified u/s 1(3) of ESI Act, 1948 or not. In such cases compliance should be made only after confirmation that the area where employees are working is actually implemented area. This can be confirmed from the nearest Branch Office of ESIC or the nearest Sub/Regional Office of ESIC.
Secondly, as per your above comments, it appears that some of your employees are also deployed in private hospitals. In this connection, before making compliance it must be ensured whether the State Government has extended the provisions of ESI Act, 1948 under section 1(5) to private Hospitals or not. To my knowledge,few State Govts. have not so far extended the provisions of said Act to Private Hospitals.

From India, Noida

In general, esic is applicable only for employees that are working at places that are covered under esic. So if you are placing employees in a project which is outside the esic zone, you do not have to pay esic for them. However, if you need to move people from site to site, you may have to keep issuing them new esic codes each time they come to a factory covered by esic. The PE will make you pay esic even if the person come there for a day.
You have to consider also the aspect of serious illness coverage, which the employee can avail of in the nearest esic hospital.the question therefore is how far is that.
The prospect of getting treatment in a local private hospital and then getting it reimbursed by esic is unlikely. So then it is better to take a Mediclaim cover for your staff

From India, Mumbai

Dear Mohan

ESIC is a beneficial legistlation. Any employee for whom the Gross wages are below Rs.15000/- shall be covered under ESIC.

Gone are the days when ESI facilities were not appreciated by workmen. These days, there are instances wherein ESIC is extending super specialty treatment to the needy. Being a Central Act the coverage is throughout India. I would recommend that you meet the concerned officials in the regional office with a prior appointment and seek all clarifications you need from them.

ESIC follows the principles of health insurance. For example, in Mediclaim you are required to pay a premium. You are reimbursed expenses incurred by you for the hospitalisation to the extent you have taken cover. If you are healthy the premium paid is not repaid in any manner. While in Mediclaim the reimbursement is restricted to hospitalisation alone, ESIC offers a host of other benefits such as Sickness Benefit, Death Benefit, Dependant Benefit, Disablement Benefit etc.,

Hence, please take guidance from the ESIC officials and I am sure that you will be convinced that this legislation is a boon to Employers these days.


From India, Madras

I think you have missed the point the Original Post was trying to make :
He is not against ESIC
His problem is that employees are posted in remote places, where ESIC facilities are not there.
So in such a case, ESIC payments (both deductions from employees and payment by employer) is a waste.
If only treatment for major illness is desired, then a mediclaim policy will be far far cheaper.
So the question now will be - is it mandatory to pay ESIC where the employee is posted in a place where no ESIC facility is there (non coverage area) even if the employee was originally recruited at a place where ESIC coverage was there.

From India, Mumbai
SWARNA chaitu

Dear Sirs,
ESIC is a very good facility provided to employees, However as your sites are under different locations first check whether all the locations are under the consideration of ESI or not, If ESI is not applicable, then you can go for a workmen compensation policy. As you are working with BHEL & IOCL both insist for some sort of coverage to employees either ESI or Workmen compensation policy .

From India, Visakhapatnam

Hello Mohan
Greetings of the day !!!!
Just for information, ESIC is not mandatory for Construction workers. So you can check the circular of ESIC.
Without sub code it is difficult to get compliance in different states. If you maintain a Centralised portal for insured employees .Because from State to state the minimum wages varies .
You have to issue Form 105 for migrant workers, those who are have already covered under ESIC during migration .Medical benefit they will get after showing the ESIC Card Med 10 .Moreover in case of exigency you have to issue ESIC card 86.
So please check all the details then do ahead.

From India, Kolkata

Daar Mr.Mohan,

You activity of business fall under construction activity.Unless the site at which your activiiy is located, is covered by ESIC, you don't have to cover your establishment in ESI ACT. ESIC extends the benefit of the scheme to those area where they have established the facility like ESI Dispensary/ ESI Hospital.. Hence first check this from ESIC Office situated in your town. In case the area is covered by ESIC then it is advisable to cover all employees drawing wages/salary below Rs. 15000/- per month. Once an employee is covered under ESI you are absolve of all the compensation/ liabilities etc in case of accident/sickness of employees..

In case the area/town/tahsil is not covered by ESIC,then it is advisable to go for accident policy under Workmen's Compensation Act for all employees. The benefit under this policy is extended only when employee met with accident at site and not outside.

The only care you have to take is that if the construction activity is undertaken at an height of 9 Meters and more you have to specifically mention to the policy provider about this. Otherwise if unfortunately any employee/workers falls from the height of 9 meters and die, no compensation shall be payable by Insurance Company.( for this 9 meters coverage, you may have to pay a little more premium)

Secondly, the work is generally of continuous nature round the clock and workers are called back to work at odd hours. Hence there is every possibility of accidents, may not be at construction site but may be on public road or other premises. Hence, get an additional coverage under Group accident policy. This is 24 hour coverage policy.

Thirdly,as regards to illness- if you desire then only takeout the policy otherwise it is not needed. If you feel it as a motivation/retention tool for your permanent employees, take a mediclaim policy for them.

The WC Policy and Group Accident polices are unnamed. That is they are in the name of employer. However, the Mediclaim policy will be in the name of employees(although premium is paid by employer)

From India, Delhi
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