Awareness about benefits of PF and ESIC

1. Information / Awareness about
ESI & PF

2. EMPLOYEE’S PROVIDENT FUND
 What is Provident Fund?
 The provident fund is a contributory amount
collected by both the employer & employee to
secure the future of Employees of an organization.
It is a joint effort made by an employer & employee
both, so as to save a handsome amount and
secure his future when an employee is not in the
position to work.

3. How PF is contributed?
 The Employee Contribution is 12% of Basic salary goes to
Employee’s PF.
 The Employer’s contribution is divided under various
schemes i.e.
• 3.67% goes to PF
• 8.33% goes to Family Pension
• 0.5% goes to Employee Deposit Link Insurance Scheme.
• 1.11 % is administrative charges on the above deductions.

4. Benefits of PF
 Highest interest rate currently @ 9.5 % p.a.
 If PF is continuously deducted for 10 yrs, one will become
eligible to get pension after retirement from services.
 Any employee whose PF is being deducted in case of his
death at any time during the employment, his spouse & two
children will be eligible to get pension.
 From EDLI scheme you will be eligible to get an amount up to
72,000 as a quick relief in case of sudden death of employee
during employment.
 Further PF amount is also exempted from income tax.

5. Employee State Insurance
Schemes (ESI)
 Employee state insurance schemes are the
schemes of social insurance under which
industrial workers are compulsorily insured
against certain risks such as sickness, maternity,&
employment injury.
 The insured worker is given certain benefits out of
the fund created by the contributions from the
workers, their employers and the state when-ever
any of these contingencies arise.

6. Contributions Under ESI
 ESI contribution made by employee is
1.75% of the gross salary of employee not
more than Rs.7500/-.
 ESI contribution made by Employer is
4.75% of the gross salary of employee.

7. Benefits of ESI
 There are six benefits under ESI schemes.
1. Sickness Benefit
2. Maternity Benefit
3. Medical Benefit
4. Disablement Benefit
5. Dependent Benefit
6. Funeral Benefit

8. Sickness benefit
 Sickness benefit consists of periodical payments
in the event of his/ her sickness, certified by a duly
appointed medical practitioner or any other person
possessing such qualifications & experience as
specified by the corporation.
 The periodical payments do not compensate fully
for the wage loss as the rate of sickness benefit
approximates only half of wage loss.

9. Maternity Benefit
 Maternity Benefit provides for periodical payment in case of
confinement/miscarriage/ sickness arises out of pregnancy
confinement and premature birth to an insured women
employee.
 The daily rate of Maternity Benefit is twice the wages of the
women worker concerned. The benefit is payable for a
maximum period of 12 weeks

10. Medical Benefit
 Medical Benefit is payable in the form of medical
treatment for and attendance on insured persons.

11. Disablement Benefit
 If an insured employee is injured in the course of his
employment he will receive free medical treatment &
temporary disablement benefit in case which is about 70% of
his wages as long as the temporary disablement lasts. In
case of permanent total disablement the injured employees
will get life pension at full rate, while incase of permanent
disablement a portion of it is will be granted as life pension.

12. Dependence Benefit
 If an insured employee dies as a result of an accident or an
occupational disease arising out of and in the course of
employment, his dependents benefits of 40 % more than the
standard benefit rate as pension.
 When an insured person dies of employment injury,
dependence benefit shall be payable to
1. Son (until he attains 18 yrs of age)
2. Widow (life or until re-marriage)
3. Daughter (until he attains 18 yrs of age or marriage which
ever is earlier)

13. Funeral Benefit
 Funeral benefit comprises payment towards the expenditure
on the funeral of an insured person who has died.
 It is payable to the eldest surviving member of the deceased
person’s family.
 The amount of funeral benefit is not to exceed rupees 1500/-
 A claim for payment of the benefit must be made within 3
months of the death of insured person or within such
extended period as allowed by the corporation or an
authority.