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REDUCTION OF EMPLOYEES STATE INSURANCE CONTRIBUTION TO 4% FROM 6.5% BY CENTRAL GOVERNMENT

Welcome to VM Legal Associates > Uncategorized  > REDUCTION OF EMPLOYEES STATE INSURANCE CONTRIBUTION TO 4% FROM 6.5% BY CENTRAL GOVERNMENT

REDUCTION OF EMPLOYEES STATE INSURANCE CONTRIBUTION TO 4% FROM 6.5% BY CENTRAL GOVERNMENT

 

 

The Central Government on Thursday, in exercise of the power conferred by Section 95 of the Act, made certain amendment to the Employees’ State Insurance (Central) Rules, 1950.

The amendment cut the healthcare benefit under the Employees’ State Insurance Act to 4% from 6.5% and this was the first reduction in 22 years.
According to Ministry of Labour and Employment, the health care benefit under the Act shall remain the same but the employee contribution reduced from 1.75% to 0.75%, while the employer contribution had reduced from 4.75% to 3.25%.

The following reduction will be effective from July 1 and the amendment made to the rules shall be called as Employees’ State Insurance (Central) Rules, 2019.

This amendment shall bring about a substantial relief to workers and it will facilitate further enrollment of workers under the ESI scheme and bring more and more members of the workforce into the formal sector and nearly 36 million employees and 1.28 million employers will gain benefit under this Act.

Refer Attachment – the Notification copy for your perusal

(https://vmlegalassociates.com/wp-content/uploads/amendments/reduction%20of%20esic%20contribution.pdf)

We hope you will find this useful.

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