INTRODUCTION

The Employee State Insurance Act, [ESIC] 1948, is a piece of social welfare legislation enacted primarily with the object of providing certain benefits to employees in case of sickness, maternity and employment injury and also to make provision for certain others matters incidental thereto. The Act in fact tries to attain the goal of socio-economic justice enshrined in the Directive principles of state policy under part 4 of our constitution, in particular articles 41, 42 and 43 which enjoin the state to make effective provision for securing, the right to work, to education and public assistance in cases of unemployment, old age, sickness and disablement. The act strives to materialise these avowed objects through only to a limited extent. This act becomes a wider spectrum then factory act. In the sense that while the factory act concerns with the health, safety, welfare, leave etc of the workers employed in the factory premises only. But the benefits of this act extend to employees whether working inside the factory or establishment or elsewhere or they are directly employed by the principal employee or through an intermediate agency, if the employment is incidental or in connection with the factory or establishment.

The ever expanding industrial horizon and reciprocal uprising of labour consciousness necessitate the employee and employer to be conversant with the current labor legislation that govern their relationship, rights and obligation.

In the conference of Labour Ministers held in January 1940, it was declared to invite the views of provincial Government, employers and workers about compulsory contribution of the sickness insurance fund. The second conference was held in year 1941, was of the opinion that any such legislation must be preceded by an actual examination of the problem in certain industries. In 1942 third conference was called for to examine a tentative sickness scheme prepared by the Labour department of the Government of India. The Conference agreed to introduce the scheme on a selective basis and recommended a sickness insurance scheme to workers in jute, cotton and heavy engineering industries. In 1943 government appointed Prof. B.P. Adarkar as a special officer to report on health insurance of the industrial workers in India. He submitted a report in 1944 which contained comprehensive contributory scheme of social insurance. Some improvements in the above scheme were

suggested by Maurice Stack and Raghunath Rao, members of ILO, who examined it at the invitation of government of India. The Adarkar Report and suggestions made by the two ILO members were discussed by the Labour Conference in October 1944, and by Standing Labour Committee in March 1945. The following recommendations were made: 1. The central Government should proceed with the preparation of a scheme of health insurance applicable to all perennial factories and covering employment injuries sand maternity benefits if possible. 2. The scheme should be circulated to Provincial governments and association of employers and workers before a bill was drafted. The Employees State Insurance Bill providing for compulsory sickness, maternity and employment injury benefits for workers in perennial factories was introduced in the central Legislature on 6th November 1946. The Employee State Insurance act was promulgated by the Parliament of India in the year 1948.To begin with the ESIC scheme was initially launched on 2 February 1952 at just two industrial centres in the country namely Kanpur and Delhi with a total coverage of about 1.20 lac workers. There after the scheme was implemented in a phased manner across the country with the active involvement of the state government. The Employees State insurance Act is a legislation which aims at bringing about social and economic justice to poor labour class. It aims at the labour welfare. But labour welfare is an elastic term bearing somewhat different interpretation in one country from another according to different social customs, the degree of industrialisation and the educational development of the workers. Investigation Committee of the Government of India has preferred to include under welfare activities anything done for the intellectual, physical, moral and economic betterment of workers whether by employers, by Government or other agencies, over and above what is laid down by law or what is normally expected as part of contractual benefits for which workers have bargained. Labour welfare is a very comprehensive term and includes everything undertaken by the State, employers and association of workers for the improvement of workers standard of living and promotion of their social and economic well being. These welfare activities need to be considerably extended so as to cover workers of every factory, industry, mines, plants and communications, etc. A definite minimum standard of welfare should be laid down, which has to be observed by all employers.

Coverage
The ESI Act 1948 applies to Non seasonal Factories using power in and Employing ten (10)or More persons Non seasonal and non- power using factories and establishments employing twenty(20)or more persons Employees of the Factories and Establishments inreceipt of wages not exceeding Rs.10,000 /- Per month are covered under this Act.

It has also been extended upon shops, hotels, restaurants, roads motor transport under takings, equipment maintenance staff in the hospitals.

Provisional Definitions
Dependant
Means any of the following relatives of a deceased insured person, namely,(i) a widow, a minor legitimate or adopted son, an unmarried legitimate or adopted daughter (ia) a widowed mother (ii) if wholly dependent on the earnings of the insured person at the time of his death, a legitimate or adopted son or daughter who has attained the age of eighteen years and is infirm; (iii) if wholly or in part dependent on the earnings of the insured person atthe time of his death,(iii) (a) a parent other than a widowed mother (b) a minor illegitimate son,an unmarried illegitimate daughter or a daughter legitimate or adopted or illegitimate if married and a minor or if widowed and a minor (c) a minor brother or an unmarried sister or a widowed sister if a minor (d) a widowed daughter-in-law, (e) a minor child of a pre-deceased son, (f) a minor child of a pre-deceased daughter where no parent of the child is alive, or (g) a paternal grand-parent if no parent of the insured personis alive

Employee
Means any person employed for wages in or in connectionwith the work of a factory or establishment to which this Act applies Persons employed through contractors also included but does not include (a) any member of the Indian naval, military or air forces; or (b) any person so employed whose wages(excluding remuneration for overtime work) exceedRs.10000/-

Family
Means all or any of the following relatives of an insured person, namely,(i) (ii) (iii) a spouse; a minor legitimate or adopted child dependent upon the insured person; a child who is wholly dependent on the earnings of the insured person and who is(a) Receiving education, till he or she attains the age of twenty-one years, (b) an unmarried daughter; (iv) a child who is infirm by reason of any physical or mental abnormality or injury and is wholly dependent on the earnings of the insured person, so long as the infirmity continues; (v) dependent parents;

Question Of Dependency
The purpose of this act is not to provide solatium to a relative of a deceased insured person but to make good the actual loss which he or she has suffered. Whether a relative of the deceased is dependent or not, is a question of fact to be decided in relation to particular circumstances of each case. Normally when the earning of the deceased workman was hardly sufficient for his maintenance and no balance was left which would contribute to the family fund the parent cannot be said to be a dependent(St. Josephs Automobile vs Maria Soosai Pillai1) In the case of Ponuswami Gounder vs Rangaswamy2, it was pointed out that in the case of poor working families particularly those living jointly all the earnings come into a common pool and it may often happen that the common pool is actually quite insufficient to maintain the members at a bare standard of existence. The court had also noticed the extreme difficulty it would pose if it tried to lay down any hard and fast rule about what is sufficint for the maintenance of an individual person and to work out an excess out of his earnings available for the father, mother, and the other members of the family to enjoy. In case of those relatives who have to be in fact wholly or in part dependent upon the earning of the deceased insured person, they must be so dependent at the time of his death.

1 2

AIR 1953 Madras 206 AIR 1953 Madras 786

Widow
A widow after remarriage does not cease to be dependent and is not disentitled to receive compensation because subsequent events do not affect the claim to compensation.

Mother
A widowed mother whether wholly or in part dependent on the earnings of the deceased or not is a dependent under Section 2(6-A)(i). Mother, other than widowed mother, comes under the category of a parent other than a widowed mother. She will be entitled to benefits under the act if she is wholly or in part dependent on the earnings of the deceased.In the case of Intibai vs N.C. Colliery3 Re-marriage does not bar the Mothers claim under the act. After the amendment of the Workmens Compensation Act in 1959, this particular view does not hold good. Also in the case of Dirji vs Smt. Gorten4 a widowed step-mother is not a dependent under this act. But an adoptive widowed mother would be included in the phrase widowed mother

3 4

AIR 1959 MP 329 AIR 1942 Pat 33

MINOR BROTHER In the case of In re Dependents of Kartar singh5 it was decided that Minor brother includes both consanguine brother and uterine brother. PARENTS Father and mother other than a widowed mother may be called dependants under the Act provided they succeed to show they were wholly or in part dependent on the earnings of the deceased at the time of his death. In the case of Kamal singh v. E.S.I.C 6 After the death of an employee Gulsher singh, his father and mother claimed themselves to be dependent on the earnings of their deceased son at the time of his death. Gulsher singh helped his father after he attained the age of 15 years. He gave all his earnings to his father. In this case, the Insurance Court appears to be influenced by the period of contribution that the deceased contributed to the family fund for a short period of two months. The question of dependence has to be settled with reference to the time of death and is not concerned with duration. It seems, therefore, that the Insurance court misdirected itself on a question of law touching the meaning of the expression dependant as used in the Employees State Insurance Act and that on fact which the Insurance Court found there follows an irrestible conclusion in law that the parents were in part dependent on the earnings of their deceased son. It is of course not possible to lay down any general rule to determine who would be a dependant for that would turn on the fact of each case. EMPLOYEE The definition of an employee under the Act has a wider meaning and it covers persons who work outside the business premises but whose duties are connected with the business. It also covers employed who are paid daily wages or
5 6

In re Dependents of Kartar singh, AIR 1931 lah 752 Kamal singh v. E.S.I.C, 1962 L.L.J 298

employed on part time wages such as persons employed by a firm carrying on business of playing music on occasion like marriage etc.7 In Tara Chand Mohan Lal v. E.S.I Corporation, 37 labourers were working for a considerable period in a factory, dealing in production of mustard oil and dal. These labourers were employed through Sardars who were the immediate employer and the firm Mohan lal was the employer. They were working under the supervision of the principal employer even if they were supplied by the sardars. These labourers were held to be employees within the meaning of sec.2(9) (1) of the act as they were directly employed for wages by the principal employer in connection with the normal work of the Factory. In Sen Raleigh v. E.S.I. Corpn.8, the factory was situated at Asansol and the head office was situated at Calcutta. It was held that in spite of the fact that the head office and factory were situated at different places the employees in the head office who are engaged in any type of work specified in Section 2(9) are employees within the meaning of this Act because the head office is at Calcutta where the provisions of the Act are applicable. In Hyderabad Asbestos v. Employees Insurance Court9, the question was whether person employed in Zonal Office and Branch Offices of a factory and concerned with establishment and administrative work or the work of canvassing sale would be covered by the provisions of the Act. It was held that an employee may be working within the factory or outside the factory or may be employed for administrative purposes or for the purchase of raw materials or for the sale of finished goods, all such employees are included within the definition of employee in Section 2(9) of the Act. It is not essential that one must be working in a factory.

7 8

Jaipur and regional Director,jaipur v. State of Rajasthan,(1987) L.L.J, 502 AIR 1977Cal 165 9 AIR 1968 SC 356

References 1. Prof. S.N. Mishra, Labour and Industrial Laws, 25th Edition

2. Avtar Singh, Labour Law

ACKNOWLEDGEMENT

I would like to thank Dr. Nuzhat parveen Khan for her constant guidance and persistent encouragement in the preparation of this humble work. It is my pious duty to express my deep obligation towards my reputed teacher for his kindness any sided benevolence.

I would also like to thank my seniors, classmates for giving ample time so that I could complete my project.

I would also like to thank Administrative staff and library staff of Faculty of Law, JMI for the co-operation.

ANKIT YADAV

An Assignment on

Employee State Insurance Act, 1948 Employee, Dependant and Family

Submitted to:Dr. Nuzhat Parveen Khan

Submitted By:-

ANKIT YADAV
Roll No. 7 B.A. LL.B(H) 3RD Year 6th Sem