New Labour Code: Unorganised Workers To Get Benefits Of Employees’ State Insurance Scheme
The four new labour codes – new wage code on wages, social security, industrial relations, occupation safety, health, and working conditions — are soon going to become a reality. Once implemented, under the social security code, the Employees’ State Insurance Scheme of India (ESIC) will be opened up for the unorganized sector workers also.
What Is ESIC?
The ESIC scheme, which is administered by a statutory corporate body called the Employees’ State Insurance Corporation, provides full medical care to the employee registered under the ESI Act, 1948 during the period of his incapacity, restoration of his health, and working capacity. It provides financial assistance to compensate for the loss of his/ her wages during the period of his or her abstention from work due to sickness, maternity, and employment injury. The scheme provides medical care to his/her family members also.
The ESI scheme is a self-financing scheme. The ESI funds are primarily built out of the contribution from employers and employees payable monthly at a fixed percentage of wages paid. The State Governments also bear 1/8th share of the cost of medical benefits. Through a small contribution, the benefit of free treatment is available under hospitals and dispensaries of ESIC. Currently, it’s available for the organized sector workers only.
After retirement also, an Insured person who superannuates or retires under a voluntary Retirement Scheme or takes premature retirement, after being an insured person for not less than 5 years, shall be eligible to receive a medical benefit for himself and his spouse subject to production of proof thereof, and payment of a nominal contribution of rupees one hundred and twenty for one year. In case the insured person expires his spouse shall continue to receive the medical benefit on the payment of contribution.
ESIC and the New Social Security Code
Under the code, The doors of ESIC will now be opened for the workers of all sectors along with the workers of the unorganized sector. Expansion of ESIC hospitals, dispensaries, and branches upto district level. This facility is to be increased from 566 districts to all the 740 districts of the country.
Under the new code, even if a single worker is engaged in hazardous work, he would be given ESIC benefit. Gig workers engaged in new technology will also be given an opportunity to join ESIC. Apart from this, plantation workers will also get benefits from the ESIC. Institutions working in the hazardous area will be compulsorily registered with the ESIC.
Other New Benefits of the Social Security Code
The benefit of the pension scheme (EPFO) will be open to all workers in organized, unorganized, and self-employed sectors. A social security fund will be created to provide comprehensive social security to the unorganized sector. The requirement of minimum service has been removed for payment of gratuity in the case of fixed-term employees, according to the new code.
Employees engaged on fixed-term will also get the same social security benefits as permanent employees, and a national database of workers of the unorganized sector will be created through registration on a portal.