Labour Ministry Announces Additional Benefits under EPFO and ESIC for Families of Employees Succumbing to COVID-19

Labour Ministry has announced reforms to Employees' State Insurance Corporation (ESIC) and Employees' Provident Fund Organisation (EPFO) to help the families of employees who are succumbing to COVID-19. The ministry has sought for enhanced social security to be provided to the workers without any additional cost to the employer. These reforms have been announced to address the fear and anxiety of workers about the well-being of their family members due to the increasing incidences of death due to COVID -19 pandemic, said the ministry.

Labour Ministry Rules for Insured People Under ESIC

At present, the spouse and widowed mother receive lifelong support, and for children till they attain the age of 25 years or female child until she gets married receive a pension equivalent to 90% of the average daily wage drawn by the worker in case an employee dies or is disabled due to employment injury. The Labour Ministry has announced that the same pension will be extended to employees passing away due to COVID-19 provided:

• The insured person has registered on the ESIC online portal at least three months prior to the diagnosis of COVID disease resulting in death.
• The insured person must have been employed for wages and contributions for at least 78 days should have been paid or payable in respect of a deceased employee during a period of one year immediately preceding the diagnosis of COVID disease resulting in death.

The dependents of insured employees who fulfill the above eligibility criteria and have passed away due to COVID will be entitled to receive monthly payment at 90% of the average daily wages of the insured person during their life, and the scheme will be effective for a period of two years from 24 March 2020.

Labour Ministry Rules for EPFO

Under the EPFO’s Employees’ Deposit Linked Insurance Scheme all surviving dependent family members of the employees are eligible to avail benefits of EDLI in case of death in a harness of the member. At present under this scheme, the benefits extended in case of death of a worker are not needing the requirement of minimum service for payment of gratuity, family pension is paid as per provisions under EPF and MP Act, sickness benefit of 70% of wages for 91 days in a year is paid in the event of a worker falling sick and not attending office. The Labour Ministry has additionally announced the following amends to help employees losing their life to COVID-19:

• The amount of maximum benefit has been increased from 6 lakhs to 7 lakhs to the family members of employees passing away to COVID.
• Minimum assurance benefit of Rs 2.5 lakh to eligible family members of deceased employees who was a member for a continuous period of 12 months in one or more establishments preceding his death in place of existing provision of continuous employment in the same establishment for 12 months. It is expected to benefit contractual or casual labourers who were losing out on benefits due to the condition of continuous one year in one establishment.
• Restoration of provision of minimum 2.5 lakh compensation retrospectively from 15 February 2020.