1.

Latest amendment to the Employee State Insurance act 1948 raised the monthly wage limit from1. 15000 to 18000 per month2. 15000 to 21000 per month3. 18000 to 21000 per month4. 21000 to 25000 per month

Answer» Correct Answer - Option 2 : 15000 to 21000 per month

The correct answer is from 15000 to 21000 per month.

  The latest amendment to the Employee State Insurance act of 1948 made two changes

  • One, it raised the monthly wage limit to 21000 from the previous 15000 with effect from 1 January 2017.
  • Second, it lowered the rate of contribution from 6.5% to 4% effective from 1 July 2019.

  Important Features of the Employee State Insurance act of 1948

  • It was the first major legislation on social security for workers in independent India.
  • The Act gives effect to the provisions of the Directive Principle as provided in Articles 39 and 41 of the Indian Constitution.
  • It makes certain social security provisions to counterbalance or negate any distress in such a situation to the person.
  • Under section 2(12) of the Act, it is applicable to all factories and establishments in an area employing 10 or more employees.
  • The act includes Medical care facilities for an insured person as well as dependent members of his/her family.
  • It also includes medical cover for some specific illnesses with cash benefits.
  • It covers 70% of the employees’ wages until 91 days but to avail this benefit, the workers require constituting at least 78 days work for six months.
  • Various benefits provided under the act
  1. Medical benefit.
  2. Sickness benefit.
  3. Maternity benefit.
  4. Disablement benefit.
  5. Dependents benefit.
  6. Funeral expenses.
  7. Rehabilitation allowances.
  • There is a special benefit provided for women employed by the act for maternity leave or any pregnancy-related issues. The period for maternity leave is 26 weeks with a One-month extension.
  • In case of death or disablement, there is a provision of monthly payment to the employee or to his dependent.
  • The scheme is also applicable for an unemployed person who will get 50% of his last salary, provided that he discloses information about his/her last employer.
  • The act established Employee State Insurance Corporation (ESIC), an autonomous corporation under the Ministry of Labour and Employment. It has been given the status of a legal entity.
  • For all employees earning 21,000 or less per month, the employer contributes 3.25% and the employee contributes 0.75%, total share 4%. This fund is managed by the ESIC according to the rules of the act.
  • Section 75 of the act provides for Employee Insurance Court to adjudicate dispute or claims related to Employee State Insurance Act 1948.
  • The latest amendment to the act made two changes One, it raised the monthly wage limit to 21000 from the previous 15000 with effect from 1 January 2017, and second, it lowered the rate of contribution from 6.5% to 4% effective from 1 July 2019.


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