NOTES
Self-Instructional
Material 137
Employee Welfare,
Separation
63% of the wages. Sickness benefit is useful to an employee who is unable
to work due to illness. Employee also gets medical treatment and financial
support.
Medical benefit: It is in the form of free medical treatment that an employee
claims in case of illness, maternity and accident. Employee gets this benefit
at ESI hospital or dispensary of the doctor to whom the worker is getting
treatment. The family of the insured worker also avails this benefit. Workers
suffering from critical diseases, such as T.B., Cancer, Leprosy and mental
diseases are provided special facilities.
Maternity benefit: It is in the form of cash payment to the insured women
for confinement, miscarriage or illness arising out of pregnancy. This benefit
is calculated at half of average daily wages. If the insured woman dies during
the period of confinement, the nominee gets the benefit for the whole period.
Disablement benefit: This is given in case of permanent disablement of an
employee. The benefit is given when an employee is caught in an industrial
accident within the factory. The annual benefits depend on the nature of
disablement. For the temporary disablement full pay is given to the employee
for the period of disablement. For the permanent disablement the employee
is given cash benefit for the life at a percentage of full rate.
Dependents’ benefit: It is given to the dependents of the employee of a
dead insured employee. The benefit is given if an employee dies in an industrial
accident. The family of the employee is entitled for cash benefit under this
scheme. The widow will receive pension for her whole life.
Funeral benefit: This is given in the form of cash upto maximum of 1,000
to the insured individual for funeral. This benefit is given to the eldest person
or the person who is actually incurring the expenditure at the time of funeral.
The Employees’ Provident Fund Act, 1952
The Employees’ Provident Fund Act was launched in 1952 that provides retirement
benefits to the employees of a company. Retirement benefits include provident
fund, family pension, and deposit-linked insurance. This Act is applicable for the
companies in India that employ 20 or more than employees except in Jammu and
Kashmir. This Act is not applicable on the companies that are registered under the
Cooperative Societies Act, 1912, or under any other law related to cooperative
societies of less than 50 individuals. This scheme is applicable to the employees
getting the salary of ` 5,000 per month.
According to this Act, the employees need to contribute 8.33 percent of
his/her basic salary and dearness allowances comprising of cash value of food
allowances and maintaining allowances given to the employees. Now, the
government has increased the rate of employee contribution to 10 per cent. The
government has introduced various provident fund schemes but the contributory
fund scheme became more popular than others. According to the contributory
