ESIC exmption for establishment

Is there any provision for ‘exemption of a factory or establishment’ from ESI coverage? If yes what is the process ?

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Hi Sagar,

Exemption of Factories or Establishments (refer to Section 87 of ESI Act)

The appropriate Government through a Gazette notification may exempt any factory or establishment or a class of factories or establishments in any specified area for a period not exceeding one year. This period of one year may be renewed by subsequent notifications, however, the extended/renewed period will not exceed one year at a time. Through such notification, the Government may prescribe certain conditions.

Such an exemption may be granted only if the employees in such factories or establishments are otherwise in receipt of benefits substantially similar or superior to the benefits provided under the ESI Act.

The application for renewal should be made three months before the date of expiry of the exemption period and a decision on the same should be taken by the appropriate Government within two months of receipt of such application.

Exemption of persons or class of persons (refer to Section 88 of ESI Act)

The appropriate Government through a Gazette notification may exempt, any person or class of persons employed in any factory or establishment or class of factories or establishments to which this Act applies from the operation of the Act. The Government may notify with certain conditions as it may deem fit to impose.

Exemption from one or more provisions of the Act (refer to Section 91 of the ESI Act)

The appropriate Government with the consent of the Corporation, may notify in the Gazette and exempt any employees or class of employees in any factory or establishment, or class of factories or establishments from one or more provisions relating to the benefits provided under the Act.

You can refer to more details of the ESI Act at The Employees’ State Insurance Act,1948 (greythr.com).

Hope the above information helps.

Regards,
Bhuvana Anand

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