Salient Features of ESI (Amendment) Act 2010 – effective from 1st June 2010.

Salient Features of ESI (Amendment) Act 2010 –

effective from 1st June 2010.

Definition of Factory u/s 2 (12)

• Current status:• Ten or more persons – with the aid of power• Twenty or more persons – without the aid of

power• Any manufacturing process is carried on• Amendment:• Ten or more persons in any manufacturing

process.• Usage of Power criteria deleted.

Extension of coverage to apprentices u/s 2 (9)

• Current Status:• Sec 2 (9) Applies to ….• any other person engaged as an apprentice

not being an apprentice engaged under Apprentice Act 1961 or under the standing orders of the establishment.

• Amendment : • “ includes any such person engaged as

apprentice whose training period is extended to any length of time”.

Dependant benefit u/s 2 (6A):

• Current Status :

• Minor legitimate or adopted son, an unmarried legitimate/adopted daughter.

• Amendment :

• A legitimate or adopted son who has not attained the age of twenty five years, an unmarried legitimate/ adopted daughter

Introduction of time limit in Sec 45A

• Current Status : • No provision in the act deals with any period

within • which an order under Sec 45 A has to be

passed.• (ESIC. Vs. Ramadas Reddiar).• Amendment :• New provision inserted -45A(ii) - to limit the

period of claim within five years from the date on which contribution become payable.

Appeal procedure against order u/s. 45 A

• Current Status : • No departmental appeal is available after the order is passed

under Sec. 45A. The employer has to obtain a stay and approach the ESI Court for remedy to avoid the recovery.

• Amendment :• Insertion of Sec 45 AA: An employer not satisfied with the

order passed u/s 45 A may prefer an appeal to an appellate authority

• Within 60 days of the date of such order• After depositing 25% of contribution ordered (OR) contribution

as per his own calculation whichever is higher.

ESI (Amendment )Act 2010

• “IP” replaced by “Employee”• 51 A : Accident arising in the course of employment.• 51 B : Accident while acting in breach of regulations.• 51 C : Accident while traveling in employer’s transport.• 51D : Accident while meeting emergency.• The words “insured person” is substituted by “employee”.

• Introduction of Sec 51 E :• Extension of benefit for accidents occurring to employees

while • Commuting from his residence to the place of employment or • place of employment to residence.


• Income limit for dependant parents u/s 2-Clause 11 (v) :

• Current Status : • Dependent parents of the insured person are eligible • for benefits under ESI Act ,irrespective of their

income Level.• Amendment :• Central Govt. is empowered to prescribe income

limit from all sources for dependents parents to become eligible for benefits under the scheme.


• Eligibility for medical benefit - after Retirement u/s 56(3):

• Current Status : • The Insured person and his spouse is eligible

to receive medical benefit – on superannuation of the Insured person – on payment of contribution .

• Amendment :• A person who retires on VRS or takes

premature retirement also eligible .


• Exemptions only prospectively u/s 91 A :• Current Status : • Any notification granting exemption u/s 87,88,90 and 91• may be issued prospectively or retrospectively • Sec. 87: Exemption of any factory/establishment not exceeding

1 year.• Sec.88 : Exemption of persons or Class of persons . • Sec.89 : Exemption of Govt. factories.• Sec.91: Exemption from one or more provisions.• Amendment:• Exemptions under sec.91 shall be issued only prospectively.


ESI Inspectors are redesignated as Social Security Officers.

ESIC may enter in to agreement with local or private body to

run hospitals.

ESIC may establish medical colleges and nursing colleges

and training institutes .


Thank You.

Salient Features of ESI (Amendment) Act 2010 – effective from 1st June 2010.

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