Acts Governing Social Security Measures in India

8/13/2019 Acts Governing Social Security Measures in India

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ACTS GOVERNING SOCIAL SECURITY MEASURES IN INDIA

NEED FOR SOCIAL SECURITY

Social Security protects the subscriber and his/her entire family by giving beneficial packages in financial

security and health care. It facilitates people to plan their future through insurance and assistance.

Social Security schemes are designed to guarantee at least long-term sustenance to families when the

earning member retires, dies or suffers a disability.

WORKFORCE IN INDIA

The dimensions and complexities of the problem in India can be better appreciated by taking into

consideration the extent of the labour force in the organized and unorganized sectors.

While as per the 1991 census, the total workforce was about 314 million and the organized sector

accounted for only 27 million out of this workforce.

workforce had increased to about 397 million out of which only 28 million were in the organized sector.

There has been a growth of only about one million in the organized sector in comparison the growth of

about 55 million in the unorganized sector.

-2000 has estimated that the

Organized sector

The organized sector includes primarily those establishments which are covered by the Factories Act,

1948, the Shops and Commercial Establishments Acts of State Governments, the Industrial Employment

Standing Orders Act, 1946 etc. This sector already has a structure through which social security benefits

are extended to workers covered under these legislations.

Unorganized sector

The unorganized sector on the other hand, is characterized by the lack of labour law coverage, seasonal

and temporary nature of occupations, high labour mobility, dispersed functioning of operations, lack of

organizational support, etc. all of which make it vulnerable to socio-economic hardships. Landless

agricultural labourers, farmers, persons engaged in animal husbandry, fishing, horticulture, bee-keeping,

rural artisans, etc. Where as in the urban areas, it comprises mainly of manual labourers in construction,

carpentry, trade, transport, communication, street vendors, hawkers, head load workers, garment

makers, etc.

SYNOPSIS OF SOCIAL SECURITY LAWS

The principal social security laws enacted in India are the following: The Employees State Insurance Act,

1948 (ESI Act) The Employees Provident Funds & Miscellaneous Provisions Act, 1952 (EPF & MP Act) The

Workmens Compensation Act, 1923 (WC Act),


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The Payment of Gratuity Act, 1972 (P.G. Act),

The Maternity benefit Act,1961.

The Employees State Insurance Act, 1948 (ESI Act)

The promulgation of Employees State Insurance Act, 1948 envisaged an integrated need based social

insurance scheme that would protect the interest of workers in contingencies such as sickness,

maternity, temporary or permanent physical disablement, death due to employment injury resulting in

loss of wages or earning capacity.

The Act also guarantees reasonably good medical care to workers and their immediate dependants.

Following the promulgation of the ESI Act the Central Govt. set up the ESI Corporation to administer the

Scheme. The Scheme, thereafter was first implemented at Kanpur and Delhi on 24th February 1952.

Benefits

The section 46 of the Act envisages following social security benefits :Medical benefit Sickness benefit

(SB) (a) Extended Sickness Benefit (b) Enhanced Sickness Benefit Maternity Benefit (MB)

Disablement Benefit (a) Temporary disablement benefit (TDB) (b) Permanent disablement benefit (PDB)

Funeral Expenses

The Employees Provident Funds & Miscellaneous Provisions Act, 1952 (EPF & MP Act)

The EPF & MP Act, 1952 was enacted by Parliament and came into force with effect from 14th

March,1952. A series of legislative interventions were made in this direction, including the Employees'

Provident Funds & Miscellaneous Provisions Act, 1952. Presently, the following schemes are in

operation under the Act:

I. II.

Employees' Provident Fund Scheme, 1952 Employees' Pension Scheme, 1995 (replacing the Employees'

Family Pension Scheme, 1971)

III. Employees' Deposit Linked Insurance Scheme, 1976

The Employees' Provident Fund Organization, India, is one of the largest provident fund institutions in

the world in terms of members and volume of financial transactions that it has been carrying on.

Employees' Provident Fund Scheme, 1952

Employee Provident Fund Scheme: Which applies to specific scheduled factories and establishments

employing 20 or more employees and ensures terminal benefits to provident fund, superannuation

pension, and family pension in case of death during service.

Employees' Provident Fund Scheme takes care of following needs of the members:

i. ii. iii. iv. v. vi.


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Retirement Medical Care Housing Family obligation Education of Children Financing of Insurance Polices

BENEFITS

A member of the provident fund can withdraw full amount at the credit in the fund on retirement from

service after attaining the age of 55 year. Full amount in provident fund can also be withdraw by the

member under the following circumstance: A member who has not attained the age of 55 year at the

time of termination of service. A member is retired on account of permanent and total disablement due

to bodily or mental infirmity. On migration from India for permanent settlement abroad or for taking

employment abroad.

Withdrawal before retirement: A member can withdraw up to 90% of the amount of provident fund at

credit after attaining the age of 54 years or within one year before actual retirement. Claim application

in form 19 may be submitted to the concerned Provident Fund Office. Accumulations of a deceased

member: Amount of Provident Fund at the credit of the deceased member is payable to nominees/ legal

heirs. Claim application in form 20 may be submitted to the concerned Provident Fund Office.

The Workmen's Compensation Act, 1923

Is one of the important social security legislations. It aims at providing financial protection to workmen

and their dependants in case of accidental injury by means of payment of compensation by the

employers.

WHO IS A WORKMAN

Workman means any person (other than a person whose employment is of a casual nature and who is

employed otherwise than for the purposes of the employers trade or business) who is

a railway servant as defined in section 3 of the Indian Railways Act, 1890 not permanently employed in

any administrative, district or sub-divisional office of a railway and not employed in any such capacity as

is specified in Schedule II, or

employed in any such capacity as is specified in Schedule II, provisions of the Act have been extended to

cooks employed in hotels, restaurants using power, liquefied petroleum gas or any other mechanical

device in the process of cooking.

Compensation In case of death the minimum amount of compensation fixed is Rs,. 80,000 and Rs.

90,000 in case of permanent total disablement. The maximum amount of compensation payable is Rs.

4.56 lakh in the case of death and Rs. 5.48 lakh in the case of permanent total disablement.

EMPLOYERS LIABILITY FOR COMPENSATION (ACCIDENTS)

The employer of any establishment covered under this Act, is required to compensate an employee :

Who has suffered an accident arising out of and in the course of his employment, resulting into (i) death,


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(ii) permanent total disablement, (iii) permanent partial disablement, or (iv) temporary disablement

whether total or partial, or(v) occupational disease. HOWEVER THE EMPLOYER SHALL NOT BE LIABLE

a) b) c)

In respect of any injury which does not result in the total or partial disablement of the workmen for a

period exceeding three days; In respect of any injury not resulting in death, caused by an accident which

is attributable to the workmen having been at the time thereof under the influence or drugs, or the

willful removal or disregard by the workmen of any safeguards. when the employee has contacted a

disease which is not directly attributable to a specific injury caused by the accident or to the occupation.

The Payment of Gratuity Act, 1972 (P.G. Act)

Which provides 15 days wages for each year of service to employees who have worked for five years or

more in factories, establishments having a minimum of 10 workers. The maximum amount of gratuity

payable is Rs. 3,50,000/-.

The Maternity Act,1961

Every woman shall be entitled to, and her employer shall be liable for, the payment of maternity benefit,

which is the amount payable to her at the rate of the average daily wage for not less than 12 weeks i.e.

preceding and following the day of her delivery does not exceed 12 weeks.

FACTORIES ACT 1948

The Factories Act, 1948

The Factories Act, is a social legislation which has been enacted for occupational safety, health and

welfare of workers at workplaces. Factories covered under the Factories Act

1.

The industries in which 10 or more than 10 workers are employed on any day of the preceding 12

months and are engaged in manufacturing process being carried out with the aid of power.

2.

The industries in which 20 or more than 20 workers are employed in manufacturing process being

carried out without the aid of power.

Welfare MeasuresFactories Act

Washing Facilities Facilities for storing and drying clothing Facilities for sitting First aid appliances

Canteens Shelters, rest rooms and lunch rooms Creches Welfare officers

Washing Facilities

In every Factory

1.


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Adequate and suitable facilities for washing shall be provided and maintained for the use of the workers

therein.

Separate and adequately screened facilities shall be provided for the use of male and female workers.

2.

3.

Such facilities shall be conveniently accessible and shall be kept clean.

Facilities for storing and drying Clothing

The State Government may, in respect of any factory or class or description of factories, make rules

requiring the provision therein of suitable places for keeping clothing not worn during working hours

and for tile drying of wet clothing.

Facilities for sitting

Suitable arrangements for sitting shall be provided and maintained for all workers obliged to work in a

standing position.

The Chief Inspector may, by order in writing, require the occupier of the factory to provide before a

specified date sitting arrangements as may be practicable for all workers so engaged or working.

The State Government may, by notification in the Official Gazette, declare that the provisions of

subsection (1) shall not apply to any specified factory or manufacturing process.

Firstaid appliances

There shall in every factory be provided and maintained, so as to be readily accessible during all working

hours, first-aid boxes or cupboards equipped with the prescribed contents.

There shall in every factory be provided and maintained, so as to be readily accessible during all working

hours, first-aid boxes or cupboards equipped with the prescribed contents.

The number of such boxes or cupboards shall not be less than 1 for every 150 workers ordinarily

employed in the factory. Nothing except the prescribed contents shall be kept in a first-aid box or

cupboard.

Each first-aid box or cupboard shall be kept in the charge of a separate responsible person, who holds a

certificate in first-aid treatment recognized by the State Government and who shall always be readily

available during the working hours of the factory.

In every factory wherein more than 500 workers are ordinarily employed, there shall be provided and

maintained an ambulance room of the prescribed size, containing the prescribed equipment and in the


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charge of such medical and nursing staff as may be prescribed and those facilities shall always be made

readily available during the working hours of the factory.

Canteens

The State Government may make rules requiring that in any specified factory wherein more than 250

workers are ordinarily employed, a canteen or canteens shall be provided and maintained by the

occupier for the use of the workers.

Such rules may provide for1.

The date by which such canteen shall be provided.

2.

The standards in respect of construction, accommodation, furniture and other equipment of the

canteen. The foodstuffs to be served therein and the charges which may be made therefore.

The constitution of a managing committee for the canteen and representation of the workers in the

management of the canteen.

3.

4.

5.

The items of expenditure in the running of the canteen which are not to be taken into account in fixing

the cost of foodstuffs and which shall be borne by the employer.

Shelters, rest rooms and lunch rooms

In every factory wherein more than 150 workers are ordinarily employed, adequate and suitable

shelters or rest rooms and a suitable lunch room, with provision for drinking water, where workers can

eat meals brought by them, shall be provided and maintained for the use of the workers.

The shelters or rest rooms or lunch rooms to be provided under sub-section (1) shall be sufficiently

lighted and ventilated and shall be maintained in a cool and clean condition.

The State Government may1.

Prescribe the standards in respect of construction, accommodation, furniture and other equipment of

shelters, rest rooms and lunch rooms to be provided under this section. By notification in the Official

Gazette, exempt any factory or class or description of factories from the requirements of this section.


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2.

Creches

In every factory wherein more than 50 women workers are ordinarily employed there shall be provided

and maintained a suitable room or rooms for the use of children under the age of six years of such

women. Such rooms shall provide adequate accommodation, shall be adequately lighted and ventilated,

shall be maintained in a clean and sanitary condition and shall be under the charge of women trained in

the care of children and infants.

The State Government may make rules1.

Prescribing the location and the standards in respect of construction, accommodation furniture and

other equipment of rooms to be provided under this section. Requiring the provision in any factory of

free milk or refreshment or both for such children. Requiring that facilities shall be given in any factory

for the mothers of such children to feed them at the necessary intervals. Requiring suitable provision of

facilities for washing and changing the clothing of children.

2.

3.

4.

Welfare officers

In every factory wherein 500 or more workers are ordinarily employed the occupier shall employ in the

factory such number of welfare officers as may be prescribed.

The State Government may prescribe the duties, qualifications and conditions of service of officers

employed under the above sub-section.

Provident fund

Provident fund

A part of your salary is deducted every month and deposited on your behalf. If you work in a private firm

then the company pays the same amount as it is deducted from your account and when you leave the

firm you can apply and withdraw the amount saved. It's actually your personal saving of your earnings. If

you are in government service then

Provident Funds and Miscellaneous Provisions Act, provides for compulsory contributory fund for the

future of an employee after his retirement or for his dependents in case of his early death.It extends to

the whole of India except the State of Jammu and Kashmir and is applicable to:every factory engaged

in any industry specified in Schedule 1 in which 20 or more persons are employed;every other


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establishment employing 20 or more persons or class of such establishments which the Central Govt.

may notify;

Employees' Provident Funds & Miscellaneous Provisions Act, 1952 Objective promoting and securing the

well being of the employees by way of provident fund, family pension and insurance to them.

inculcating a habit of saving amongst workers. providing a steady workforce to the employers and

assisting the government by providing funds of considerable magnitude for utilization on various

projects meant for promoting economic and social development of the country and the well being of its

people.

Applicability The Act shall apply to every establishment which is a factory engaged in any industry

mentioned in schedule I of the Act and employing 20 or more persons or any other establishment

employing twenty or more persons or such other establishment as the central Government may notify.

Employees Provident Funds and Miscellaneous Provisions Act, 1952

SCHEMESEmployees Provident Funds Scheme,1952sec 5Employees Pension Scheme,1995sec

6AEmployees Deposit-Linked Insurance Scheme,1976sec 6C REGULATORY MECHANISMCentral

Board - section 5AExecutive Committeesection 5AAState Board - section 5BCentral

Government

Hemant Sahai Associates

Advocates

Contribution of Employee12% of the Pay.* Payincludes basic wages# with dearness allowance,

retaining allowance. VOLUNTARY CONTRIBUTION: -Member shall be at liberty to make voluntary

contribution .Minimum PF Contribution: 12%, Maximum PF Contribution: 100% of the Pay. # Tax

Benefits to the contribution are applicable as per Income Tax Rules. Employers

Employees Provident Fund Scheme, 1952

What employee gets.

Benefit StructureAccumulated Balance paid out on retirement. Balance = Employee and Employer

Contributions + Interest creditedNon-refundable Loans

HRM PRESENTATION

TOPIC: PENSION FUND AS A MEAN OF SOCIAL SECURITY

MEANING OF THE TERM SOCIAL SECURITY

Social security:

Primarily refers to social welfare service concerned with social protection, or protection against socially

recognized conditions, including poverty, old age, disability, unemployment and others. Social security

may refer to: 1) Social insurance 2) income maintenance 3) Services 4) basic security


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CONTD.

Social insurance- where people receive benefits or services in recognition of contributions to an

insurance scheme. These services typically include provision for retirement pensions, disability

insurance, survivor benefits and unemployment insurance. Income maintenancemainly the

distribution of cash in the event of interruption of employment, including retirement, disability and

unemployment Services provided by administrations responsible for social security. In different

countries this may include medical care, aspects of social work and even industrial relations. Basic

security, a term roughly equivalent to access to basic necessitiesthings such as food, clothing, shelter,

education and medical care

NEED FOR SOCIAL SECURITY

Poverty in India points towards the need to adopt a wider concept of social security that would include

both promotional and protective social security Prevention against increases in deprivation and the

promotion of better chances of individual development. Provides financial relief at the time of distress.

People all over the world are living longer, having fewer children, and expecting higher standards of

living in their retirement years. The most important feature shared by all these workers is the absence of

any sort of protection: whether it be employment security, pension, or coverage for risks such as ill

health, accidents, death

CONTD.

Affects labour productivity and thus has implications that extend far beyond the workers and their

families themselves With India's traditional means of support (the extended family), gradually breaking

down a huge, impoverished and aging segment of the population is becoming an enormous drain on the

country's resources. As people grow older the expenditure on their health also increases. While social

security systems are meant to take care of the redundant/unemployed or the unemployable, self-

accumulated retirement savings are the only saviour for citizens of countries where formal social

security systems dont exist

PENSION

A pension is a steady income given to a person (usually after retirement). Pensions are typically

payments made in the form of a guaranteed annuity to a retired or disabled employee. Occupational

pensions are a form of deferred compensation, usually advantageous to employee and employer for tax

reasons. Many pensions also contain an insurance aspect, since they often will pay benefits to survivors

or disabled beneficiaries, while annuity income insures against the risk of longevity.

PENSION FUND

A Pension fund is a pool of assets forming an independent legal entity that are bought with the

contributions to a pension plan for the exclusive purpose of financing pension plan benefits.

SOCIAL SECURITY ACTS PASSED BY THE GOVT.

WORKMENS COMPENSATION ACT EMPLOYEE STATE INSURANCE ACT EMPLOYEE PROVIDENT FUND ACT

MATERNITY BENEFIT ACT PAYMENT OF GRATUITY ACT


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EMPLOYEE PROVIDENT FUND

Employees Provident Funds Scheme, 1952.

Employees Deposit-Linked Insurance Scheme, 1976 .

Employees Pension Scheme 1995 (Earlier Employees Family Pension Scheme, 1971) . the

Employees Provident Funds Scheme, 1952

To provide old-age and post service financial support to the workers in general employed in Industrial &

Commercial Sector establishments. The scheme provided for provident fund system on contributory

basis by the Employers and the Employees at equal rate.

It made available to the employee concerned the accretions in the Provident Fund a/c with interest in

lump sum on retirement or leaving the job.

CONTRIBUTION OF THE EMPLOYEE

1. 12% OF THE PAY ( INCLUDING BASIC WAGES ) 2. VOLUNTARY CONTRIBUTION BY EMPLOYEE 3.

EMPLOYER CANNOT REDUCE PAY 4. MINIMUM CONTRIBUTION 12% 5. MAXIMUM CONTRIBUTION

100% 6. TAX BENEFITS APPLICABLE AS PER INCOME TAX RULES

CONTRIBUTION BY THE EMPLOYER

1. EQUAL TO 12% PAY OF THE EMPLOYEE 2. EPS8.33% OF PENSIONBLE SALARY 3. PF12% PAYEPS

OTHER PROVISIONS IN THIS ACT

1. An employee may be allowed to make a nomination conferring on one or more persons the right to

receive the provident fund amount.

2. If an employee nominates more than one person, he shall, in his nomination specify the amount or

share payable to each of the nominees. 3. Where an employee has a family at the time of making a

nomination, the nomination shall be in favour of one or more persons belonging to his family

EMPLOYEES DEPOSIT-LINK INSURANCE SCHEME 1976

Provides for payment of assurance benefit, upon death of the member while in service; linked to the

average balance in the provident fund account of the deceased member. The assurance benefit shall be

payable to the person entitled to receive provident fund accumulation of the deceased member.

MEMBERSHIP : ALL MEMBERS OF PROVIDENT FUND CONTRIBUTION: EMPLOYEES NOT REQUIRED TO

CONTRIBUTE EMPLOYERS ARE REQUIRED TO CONTRIBUTE 0.50% OF PENSIONABLE SALARY

EMPLOYEES PENSION SCHEME, 1995 (EARLIER THE EMPLOYEES FAMILY PENSION SCHEME 1971)

CONTRIBUTION

1. Employee is not required to contribute separately under the Employees Pension Scheme 1995. 2.

Employer share of Provident Fund Contribution @ 8.33% is diverted to Pension Fund


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TYPE OF PENSION

Monthly Members Pension: On attaining the age of 58 years. Invalidity pension: Permanent and total

disablement during the course of employment. Widow pension: Death of member whether in service or

after exit from employment or after retirement/ commencement of monthly member pension. Pension

for life or until remarriage Children pension: Payable to two children of deceased member upto the age

of 25 years in addition to widow. Orphan pension: Two orphan children upto the age of 25 years.

Nominee pension: In case of unmarried members, a person nominated by the member will get pension

equal to widow pension.

REASONS FOR A NEW PENSION SCHEME

Close to 65% of population still live in rural areas are not covered. Of the salaried 20% are govt

employees-have a defined, indexed, pension entirely funded by the govt. About 49% of non-govt

employees only covered by EPF & EPS. Less than 10% are eligible for the formal pension fund scheme

estimated working population. Serious majority of workers who are not below the poverty line might go

below it after their as they have not accumulated enough savings for future.

NEW PENSION FUND SCHEME

The Pension Fund Regulatory and Development Authority Bill, 2005 establishes an authority to develop

and regulate the new pension system (NPS) which seeks to provide old age income security for all

individuals, including those in the unorganised sector. NPS will be implemented through a combination

of retailers, pension funds and record keeper(s). Every subscriber will have an individual pension

account, which will be portable across job changes. The subscriber will choose the fund managers and

schemes to manage his pension wealth. He also has the option of switching schemes and funds. The NPS

has already been operationalised for new central government employees through a notification. This is a

'defined contribution' scheme unlike the 'defined benefit' scheme for existing central government

employees

KEY ISSUES AND ANALYSIS

1) The Bill provides a structure to the private and unorganised sectors to plan for old age income

security. It is not compulsory for these sectors to take part in this system. Those not participating may

still have to fall back on public resources in old age. 2) In the system for new government employees,

the investment risk is entirely borne by the employee. However, he is no longer exposed to the risk of

default by the government. 3) Only 13% of the workforce is currently covered by pension schemes.

These are government employees and those in the organised sector covered by the Employees Pension

Scheme 1995. This Bill provides a regulatory framework for a new pension system (NPS) which will be

available to any individual

Contd..

4)Any unfavourable event affecting market prices at the time of retirement could lower both pension

wealth and the annuity rate. Subscribers may have to stay on in the system beyond their retirement

date in order to ride over such a shock. 5)Parliamentary Research Service (PRS) estimates that given


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current market rates for annuity, Rs 1,000 per month subscribed to NPS for 35 years will result in

lifetime annual pension for self of Rs 47,000 to Rs 77,000 under different scenarios of returns.

KEY IMPLICATIONS LEADING TO SOCIAL SECURITY

PROVIDES SOCIAL SECURITY TO THE PEOPLE IN THE FORM OF INCOME THROUGH PENSIONS INCOME

REMAINS DEFINED WITH NO FLUCTUATIONS ALL CONTRIBUTIONS,ACCUMULATIONS AND RETURN OF

BALANCES ON RETIREMENT ARE ALL TAXADVANTAGED ENJOY THE FACILITY OF SOFT LOANS FOR

HOUSING FROM THE EMPLOYERS GROWTH IN VALUE OVER THE LONG TERM. INVESTMENT ACCORDING

TO OUR PRIORITIES HIGHER RETURS DUE TO CHANGES IN INVESTMENT PATTERNS ( DEBT, EQUITY )

OPTIONS OF WITHDRAWING ANY TIME OF THE YEAR

WHAT ARE STATUTORY WELFARE ACTIVITES?

These are the Legal welfare activities for uplifment of employees. As in industries we are having

Performance Appraisal system and 360 Degree Feedback Method for uplifment of employees similarly

we have to take care of employees by welfare activities. Statutory Welfare Activities (Legal)

It is the function of the public authorities to promote the well-being, health and welfare of the

employees. The provision of social welfare and health care services in practice is the task of the

individual employee.

Compulsory to provide by an organization as compliance to the laws which govern employee health

and safety. These include provisions given in industrial acts like Factories Act 1948 , Dock Workers Act

(Safety health & welfare) 1986 , Mines Act 1962

STATUTORY WELFARE SERVICES

Customs/Excise Conveyance Allowance Educational Allowance Income Tax Concession Award of

Dealership by Oil Companies Economic Assistance by Public Sector Banks

STATUTORY WELFARE SCHEMES

First aid facilities Rest rooms Changing rooms Canteens Access to workplace Medical/Hospital facilities

STATUTORY WELFARE SCHEMES

Ventilation Lighting Space Heating Cleanliness

VARIOUS ACTS

The Factories Act, 1948 Employees Provident Fund Act Payment of Gratuity Maternity Benefit Act The

Employee State Insurance Act , 1948 Health and Safety at Work Act 1974 Industrial Disputes Act

The Factories Act, 1948


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The industries in which 20 or more than 20 workers are employed in manufacturing process being

carried out without the aid of power. Sitting facilities for occasional rest for Workers who are obliged to

work standing. Provided for routine inspections of factories

Detailed policies about cleanliness ,disposal of wastage, ventilation, spacing between workers, urinals,

drainage, drinking water facilities etc This act is a complete document on hours of work, holidays,

special provisions on accidents and diseases. Need a welfare officer if working more then 500 or more

workers.

All factory rooms must be well ventilated and lime-washed twice a year. Children must be supplied with

two complete outfits of clothing. The work hours of children must begin after 6 a.m., end before 9 p.m.,

and not exceed 12 hours a day. Child labour should be avoided. Male and Female children must be

housed in different sleeping quarters. Children may not sleep more than two per bed.

Employees Provident Fund Act

This Act may be cited as the Employees Provident Fund Act, No.15 of 1958. For the purposes of this Act,

there shall be established a fund to be called the Central Provident Fund into which shall be paid all

contributions authorised under this Act and out of which shall be met all payments authorised to be

paid under this Act. A worker who completes 6 months continuous service or 120 days of work during 12

months is eligible. According to this scheme , the employer would pay 10 to 12 percent of the basic

wage to the fund . The employee makes equal contribution.

Payment of Gratuity

This act includes all factories and establishments that employ 10 or more employees.

Gratuity shall be payable to an employee on the termination of his employment after he has rendered

continuous service for not less than five years(a) on his superannuation, or (b) on his retirement or

resignation, or (c) on his death or disablement due to accident or disease.

The total gratuity payable should not me more than 20 months wages.

Maternity Benefit Act

To regulate the employment of women in certain establishments for certain periods before and after

childbirth and to provide for maternity benefits and certain other Benefits This act applies to all women

not covered by ESI Act and who have completed 160 days of service in last 12 months It allows for 6

weeks leave before and after the delivery during which she is paid the average daily wage.

A women shall be entitled to maternity benefit only if she has actually worked in an Establishment of the

employer for a period of not less then eighty days in the twelve months immediately proceeding the

date of her expected delivery (section-5[2])

The Employee State Insurance Act, [ESIC] 1948


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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 .

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 centers in

the country namely kanpur and Delhi with a total coverage of about 1.20 lac workers.

Health and Safety at Work Act 1974

Before 1974 approximately 8 million employees had no legal safety protection at work. HASAWA 74

provides the legal framework to promote, stimulate and encourage high standards of health and safety

in places of work. It protects employees and the public form work activities. Everyone has a duty to

comply with the Act, including employers, employees, trainees, self-employed, manufacturers,

suppliers, designers, importers of work equipment. Secures Health Safety and Welfare protects other

people against risks from the activity of other people at work.

controlling emissions

Industrial Disputes Act

An Act to make provision for the investigation and settlement of industrial disputes, and for certain

other purposes. COLLECTIVE AGREEMENTS:(a) Collective agreement(i) any employer or employers, and

(ii) any workmen or any trade union or trade unions consisting of workmen, and

(b) which relates to the terms and conditions of employment of any workman, or to the privileges, rights

or duties of any employer or employers or any workmen or any trade union or trade unions consisting of

workmen, or to the manner of settlement of any industrial dispute.

For the purposes of this Act, the President may from time to time appoint a panel, of not less than five

persons, from which industrial courts shall be constituted as herein after provided.

An industrial court consists of three persons, a member of the court nominated by the Minister shall be

the president of the court nominated by the Minister shall be the president of the court.

NonStatutory means

Not fixed by law

Facility means

buildings, services, equipment, etc. that are provided for a particular purpose:

Keep employee

Loyalcontent

Differentiate the company Attract talent


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Leadership position on workplace safety even before Thomas J. Watson, Jr. issued first formal policy in

1967 Well Being Management System

the companys holistic approach to managing the health and safety of employees wherever they work.

At-home work location Employee has access to qualified physicians, nurses.

Preventive and wellness program

Life at Home

Work/life balance program Flexible work options Employee assistance program Health promotion

Life in the workplace

Accident/Illness Prevention Quality of workplace environment Quality of facilities

Healthcare management programs

Life at Home

Disability Management Conditions Management

Life in the workplace

Progressive return to work

Onsite Programs

Express wellness onsite is a program that is offered at select US sites, that provide important health

screenings for cholesterol, blood pressure, glucose, body fat percentage, and bone density , as well as

welfare coach consultation and goal setting.

Employees can access health and wellness programs without leaving their home or office.In US,

Virtual Fitness Center (VFS) can be used by employees to help make fitness a part of their daily lives.

Online Programs

Accessible 24 x 7 from any computer in Internet Employees are able to set goals, track their activities

and chart their success and stay focused on fitness goal.Health and Wellness Companion Interactive

online health information tool to make them informed choices about their health. They can learn about

prescription, and nonprescription medications, evaluate their health risk and discover ways to improve

their health including better nutrition, stress management, and maintaining a healthy weight.

Healthy Living Rebate Program for employee who dont smoke or if they do, are willing to participate in

an IBMsponsored working cessation programcan receive a $150 cash rebate. Virtual Fitness Center

Routine of physical activity and log their performance


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IBM provides a range of accommodations and assistive devices for employees who have disabilities,

including:

Constructing ramps, power doors, parking facilities and other accommodations to provide access for

people with impaired mobility.Captioning videotapes and providing sign-language interpreters and

note takers for classes and meetings for employees who are deaf or hard of hearing.Recording

company publications on audiocassette for employees and retirees who are visually impaired.

Providing travel assistance for employees with mobility impairments.Providing adaptive services or

modifications such as screen readers, display-screen magnifiers, keyboard guards, real-time captioning

of meetings and Webcasts, and telecommunications devices and telephone amplifiersto enable

people with disabilities to use work-related equipment.

Two new IBM Accessibility Centre developments also provide IBM employees with disabilities with

enhanced assistive technology tools and options:

Home Page Reader v3.04, provides employees with disabilities with a range of new capabilities,

including the ability to read accessible, tagged PDF documents and Macromedia Flash content, and a

new zoom feature that enlarges everything on a Web page. aDesigner is a disability/barriers simulator

that helps Web designers test the accessibility of Web pages for people who are visually impaired. The

software program is now available on IBM alphaWorks for download.

Portable computers are being used everywhere today. Work can be performed anywhere anytime.

IBMs ergonomics program is for remote and mobile workers with a focus on communicating the

availability of ergonomic accessories to our employees as well as continuing an education campaign on

healthy computing practices and behaviours worldwide.

Stock options Intel University Tuition Assistance Mentoring Career Opportunities

Flexible work schedules Compressed work weeks and alternate work schedules Telecommuting Home

office options Part-time employment Job share Childcare assistance Resource and referral services

Work/Life seminars and training Employee discounts

Onsite convenience stores Fitness centres and recreation facilities Nursing mothers rooms Health and

wellness benefits Employee groups and clubs Family events Rideshare and transportation programs Intel

volunteer programs Geographically dispersed teams Paid time off (including sabbaticals in the United

States) Leaves of absence

Improve the lives of employee Employee loyalty increases Employee identifies themselves with

company Employee satisfaction increases Attrition rate goes down Enhance the work life of employee

Employee remains healthy, absenteeism lowers increasing the productivity

Employee get lazy Employee may feel they are getting a free ride Not everybody avails the facilities like

gym hence employees do not get healthy


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ANOTHER PRESENTATION ON PROVIDENT FUND ACT

Contents

Objectives of the Act Employees Provident Fund Organisation (EPFO) Benefits of Employees Provident

Fund Important Definitions Employer Contribution Employee Contribution Administration of the Fund

Advances/Withdrawals & Final Withdrawal Schemes Under the Act

1. Employees Family Pension Scheme 2. Employees Deposit Linked Insurance Scheme 3. Employees

Pension Scheme

Achievements of EPF Conclusion

Whats this Act mean

Employees Provident Fund Act 1952 provides security for OLDAGE to the industrial workers who are not

able to save out of their meagre emoluments for their future.

Objectives of the Act

Employees Provident Fundpart of social security promoting and securing the well being of the

employees by way of provident fund, family pension and insurance to them. Inculcates a habit of saving

amongst workers Employees contributing sums to the Provident Fund

Employees Provident Fund Organization (EPFO)

The Employees Provident Fund 1952, provides for compulsory provident fund, pension and deposit

linked insurance in factories / establishments employing 20 or more employees in scheduled industries,

which is implemented through offices of Employees Provident Fund Organization.

Benefits of Employee Provident Fund

A member of the provident fund can withdraw full amount at the credit in the fund on retirement from

service after attaining the age of 55 years. Full amount in provident fund can also be withdraw by the

member under the following circumstance: A member who has not attained the age of 55 years at the

time of termination of service. A member is retired on account of permanent and total disablement due

to bodily or mental infirmity. On migration from India for permanent settlement abroad or for taking

employment abroad.

The payment of provident fund be made after complementing a continuous period of not less than two

months immediately preceding the date on which the application for withdrawal is made by the

member: Where a member is discharged and is given retrenchment compensation under the Industrial

Dispute Act, 1947.

Retrenchment Compensation: It is received by a workmen under the industrial disputes Act or Under a

Contract of from his Employer at the time of his Retrenchment or on the closure of Transfer of the


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business of the employer will be exempted as a) Amount calculate in accordance with the provision of

the Industrial Dispute Act. Or b) Rs.500000 (whichever is less, is exempt)

Important Definitions

Appropriate Government [Section 2(a)]:

Establishments under control of Central Government or in relation to an establishment connected with

railway company or branches in more than one state and in relation with the State Government

Basic Wages [Section 2(b)]:

All emoluments earned by employee while on duty or on leave or on holiday with wages in terms of the

contract of employment which are paid or payable in cash but does not include: (i) the cash value of any

food concession (ii) dearness allowance, house rent allowance, overtime allowance, bonus, commission

payable to employee in respect of his employment

Contd

Contribution [Section 2(c)]:

Contribution means a contribution payable in respect of a member or an employee to whom the

Insurance Scheme applies.

Controlled Industry [Section 2(d)]: It means any industry the control has been declared by the Central

Government to be expedient in the public interest. Employer [Section 2(e)]: The owner or occupier of

the factory or the person of authority having the ultimate control over the affairs of establishment.

Employee [Section 2(f)]:

A person who is employed for wages in any kind of

Contd

Factory [Section 2(g)]:

Premises including the precincts thereof in any part of which a manufacturing process.

Family pension Fund [Section 2(gg)]:

means established under the Family pension Scheme

Family Pension Scheme [Section 2(ggg)]:

Employees Family Pension Scheme framed under Section 6A (Consolidated Annual Contribution

Statement for the currency period)

Fund [Section 2(h)]:

means Provident established under the Scheme

Contd

Industry [Section 2(i)]:


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Industry added to the Schedule by notification under Section 4 (Contribution card for employees other

than monthly paid employees for the period)

Insurance Fund [Section 2(i-a)]:

Deposit linked insurance Fund established under section 6(c)

Insurance Scheme [Section 2(i-b)]:

means Employees Deposit Linked Insurance Scheme framed under Section 6(c)

Contd

Manufacturing process [Section 2(i-c)]:

any process for making, repairing, finishing, packing any article or substance with a view to its use, sale,

transport etc.

Member[Section 2(j)]:

member of the Fund

Occupier of the factory [Section 2(k)]:

Person who has ultimate control over the affairs of the factory where the affairs are entrusted to the

managing agent.

Employer/Employees Contribution

Particulars Employers Contributio n Employees Contributio n Statutory PF Amount is not taxable Fully

exempt RPF Amount is not taxable 12% of salary exempt 9.5% of P.A Interestexe mpt URPF Amount is

not taxable Salary fully exempt Fully exempt PPF Amount is not taxable He does not contribute Fully

exempt

Interest on Balance

After retirement Amt recorded at the time of Maturity

Fully exempt

Fully exempt

Fully exempt

Taxable

Fully exempt

Employers contribution


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Section 6 (Return of the Contribution Cards sent to the Commissioner on the expiry of the period of

currency) of the act provides that contribution which shall be paid by the employer to the Fund shall be

8-1/3% of the basic wages, DA, RA if any for the time being payable to each of the employees whether

employed by him directly or through a contractor

Employees Contribution

The employees contribution shall be equal to the contribution payable by the employer in respect of

him an amount not exceeding 813% of Basic wages, DA and RA, if any.

Employees if they desire may make contribution exceeding this amount subject to the condition that

employer shall not under any obligation to contribute over and above the contribution payable under

the Act.

Administration of the fund

Board of Trustees or Central Board:

Section 5A(Return of Employees qualifying for membership of the Employees Provident Fund for the

first time during the month) provides the administration of the Fund and notification given the Central

Government and it is extends by Board of Trustees to:

(a) (b) (c)

(d)

A Chairman and a Vice-Chairman to be appointed by the Central government Not more than 15 persons

to be appointed by the Central Government from amongst its officials Not more than 15 persons

representing government of such States as the Central Government may specify in this behalf appointed

by CG 10 persons representing employers of the establishing to which the Schemes applies, appointed

by the CG after consultation with such organizations of employers/employees as may be recognised by

the CG in this behalf.

Advances/Withdrawals

Non refundable advance for payment of premia towards policies of Life Insurance of a member

Withdrawal for purchasing a dwelling house or flat or for construction of house including acquisition of a

suitable site and necessary alterations for the improvement of the house. Withdrawals for repayment of

loans in special cases Non-refundable in case of: (a) hospitalization lasting one month or more (b) major

surgical operation in a hospital (c) suffering from T.B., leprosy, Paralysis for the treatment of which leave

has been granted by the employer Non-refundable advance for (i) surgical operation or daughter/sons

marriage or any member of the family (ii) for member affected by cut in the supply of electricity or

incase of property damaged by calamities. (iii) or for physically handicapped members for purchasing an

equipment

Final Withdrawal

Full accumulations with interest thereon are refunded (i) in the event of death, permanent disability (ii)

retrenchment or migration from India for permanent settlement abroad, voluntary retirement, transfer


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to an establishment not covered under the Act With the permission of commissioner or any subordinate

officer to him, a member is allowed to draw full amount when he ceases to be in employment and has

not employed in any establishment to which the Act applies for a continuous period of atleast 2 months.

The Employees Family Pension Scheme

This scheme provides Family Pension and Life assurance benefit to the employees The Central

government provides long-term financial security to the families of industrial employees

Membership of Employees Family Pension Scheme

Retention of Membership: Can Continue to be a member upto age 60 Or quit the service and withdraws

Or dies during the period of reckonable service

Family Pension Fund: The contribution from one and 1/6% of employees pays an equal amount of one

and 1/6% from and out of employees contribution is remitted by the employer to the Family Pension

Fund

The Employees Deposit-linked Insurance

Scheme

This Act amended in 1976 by Central Government The purpose of the scheme is providing life insurance

benefit to the employees of any establishment

Contribution to the Insurance Fund:

Employers pay 0.5% of the total emoluments

Administrative Expenses:

Employers are required to pay at the rate of 0.01% The Central Government also meets the expenses at

the rate of 0.005%

Nomination:

The nomination made by a member under the Employee Fund Scheme is treated as nomination under

this scheme Benefit Payable: On the death of an employee, the persons entitled receives an additional

amount equal to the average balance in the provident fund account

The Employees Pension Scheme, 1995

Under this scheme pension at the rate of 50% of pay is payable to the employees on retirement on

completion of 33yrs of service Minimum 10yrs service is required for entitlement to pension Depending

upon salary and service at time of death pension ranges from Rs.450 to Rs.2500/month The Central

Government also contributes at the rate of 1.16% to the scheme

Contd

Employer not to reduce wages: It prohibits an employer from reducing directly or indirectly the wages of

any employee to whom the Insurance Scheme applies Inspector: The appropriate Government by


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notification in the Official Gazette appoint such persons as it thinks fit to be inspectors for the purpose

of this Act or the Pension Scheme or the Insurance Scheme The inspector appointed exercise powers for

the purpose of inquiring to the correctness of any information furnished in connection with this Act

Achievements of Employees Provident Fund

The coverage of benefits of PF, family pension and deposit linked insurance increased from 2.31 crore

subscribers as on 31.03.1998 to nearly 3.95 crore subscribers as on 31.03.2003

A nationally unique Social Security Number for each worker would be provided. The scheme was

launched by way of a ReinventingEPF India programme on 25.02.2003 so as to reduce claim

settlement from 30 days to 2-3 days only

Any Time Any Where access for a member to service for settlement of claim or for information

relating to account balance.

Creates a facilitating environment and capacity for geometric growth in membership Additional facilities

of disbursement of pension through 26000 post offices has been introduced so as to benefit the workers

who after retirement go back to their native places located in rural and far flung areas A new Directorate

of recovery has been approved to step up recovery of EPF dues.

Conclusion

On the basis of the above analysis, the lists of classes of establishments other than factories be

removed, extending the provisions of the Employees' Provident Fund Act 1952 and the schemes framed

there under to all establishments, irrespective of their activities. This will enlarge the scope of social

security benefits covering the workers engaged in both the organized or non-organized sector.

References

Book References: Human Resources Management by T.N Chabbra

Website References: http://www.corpmen.com/labourlaws/epfmpa195 2/epf_brief.htm

http://epfindia.nic.in/epf.htmanaging safety in the John Jacob PGM07060555 workplace

Dimensions of safety

People safety Machine and Material safety Product safety

Safety legislation

Factories Act 1948: No young person allowed to work on dangerous machines without training or

supervision (Sec 23) If there is risk of injury to the eyes then due protection must be provided to the

worker. (Sec 35) Those persons working in gas chambers or related areas must wear gas masks for

protection. (Sec 36)

In every factory, precautions and all measures to ensure safety against fire should be applied. (Sec 38) If

it appears to the Safety Inspector that a certain part of the building or machinery is not safe to use, then


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he can prohibit its use and recommend changes to be made. (Sec 40) Every factory with more than 1000

employees must have a Safety Officer. (Sec 40B) A Safety Committee must be setup in those relevant

industries and must have equal represent management and workers. (Sec

Case study 1: Vista Foods Pvt. Ltd.

Core business: Food processing (Supplier for McDonalds) Products: Chicken and Veg Burgers Location:

Taloja, Panvel Capacity: 8000 metric tonnes/annum Area: 1500 sq. metres Employees working: 180

Safety measures (people)

Safety sensors Safety lids Fire extinguishers (2 per line, 2 lines) Assembling points Flowchart for

emergency Training for fire emergency (annual) Medical checkup (annual) Eye washers

Emergency switch Emergency exits Antiskid on floors and staircase Safety Helmets Vehicular inspection

Mock drills once a year Water hydrants Siren Smoke alarm First aid

Other highlights

External training One accident in 1998 Safety audit by Intratec (Score:88.5%) Investment in safety has

gone up.

Case Study 2: Vizag Steel Plant

Core business: Steel manufacturing Products: Steel, manganese, alloys Location: Vizag Capacity: 4

million tonnes (annual) Area: 1000 acres Employees working: 17, 500

Safety measures

Safety engineering dept. and committee Safety pass CISF Fire Unit Automated fire safety devices Mock

drills (Bi-monthly)

Training programs

Material handling Gas safety Road safety Fire fighting First Aid and safety health precautions

Occupational health hazards Mock Drill

Other highlights

Investment in safety: Rs 3 crores (procurement) and Rs 5-6 lakhs (training) Two major accidents in the

last 5 years. Training done internally but there are external safety audits done (OSHAS 18001) Safety

Innovation Award in 2006.


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Acts Governing Social Security Measures in India

Documents