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Govt. reduces ESI contribution rate to 4% from 1st of July, 2019

Ludhiana, June 29, 2019 (Yes Punjab News)

Ministry of Labor and Employment, Govt. of India has reduced ESI Contribution from 6.5% to 4% from 1st July 2019. A Notification in this regard has been issued on 13th June 2019 amending the Rule 51 of Employees’ State Insurance (Central) Rules, 1950. This shall come into force with effect from the contribution payable for the month of July 2019.

While giving this information, Mr P. K. Narula, Director Sub Regional Office, ESIC, Ludhiana said that the reduced rate of the contribution will bring about a substantial relief to workers and motivate employers to bring more employees under ESI Scheme.

The benefits under the ESI Scheme will remain the same, but employees would now have to contribute just 0.75% of their wages, instead of the existing 1.75%, while the employers’ contribution will come down from 4.75% to 3.25%.

In order to bring more and more workers under the ambit of scheme and to cover such units which are coverable but not covered, a survey drive has been launched w.e.f. 01.07.2019 to 30.09.2019.

Team of officers will visit such units during the drive and advise the employers to cover their units as per applicability of the Act. As per communiqué received from ESIC Hqrs. Office, field officers will conduct focused survey in liaison with other State and Central Govt. Departments.

The Employees’ State Insurance Corporation under the Ministry of Labour and Employment is a pioneer Social Security organization providing comprehensive social security benefits like Medical Care and a range of Cash Benefits in times of need such as employment injury, sickness, death etc.

The ESI Act applies to premises/precincts where 10 or more persons are employed. The employees drawing wages up to Rs.21,000/-a month are entitled to Medical Benefit and other cash benefits, under the ESI Act.

The Act now applies to over 10.33 lakh factories and establishments across the country, benefiting about 3.43 crores family units of workers. As of now, the total beneficiary population of ESI Scheme stands over 13.32 crores.

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