New Delhi: The Employees' State Insurance Corporation (ESIC) is set to increase its salary cap for membership from Rs 21,000 to Rs 30,000. This change, expected to bring one crore new workers under the scheme's coverage across India, will benefit an additional five lakh people in Kerala alone, where the current ESI membership stands at around ten lakh.

This revision comes in response to significant salary hikes over the past seven years, during which the ESI cap remained unchanged. The current pay scale, set in 2017, has seen about 80 lakh workers exit the scheme due to rising incomes. The proposal for the new limit was decided during the ESI Standing Committee meeting last month, and a final decision is expected at the upcoming board meeting.

Back in 2014, a similar proposal, aimed to increase the salary limit to Rs 25,000, was announced by the then Labour Minister. However, the 2017 notification set it at Rs 21,000. S. Durairaj, a board member, emphasised the need to not only raise the salary cap but also to allow continuous ESI membership for employed individuals, similar to the Provident Fund (PF) model.

The Bharatiya Mazdoor Sangh (BMS) has been advocating for higher salary limits for both ESI and the Employees' Provident Fund (EPF). In a recent discussion with the Minister of Labour and Employment, Dr Mansukh Mandaviya, BMS representatives highlighted these issues. The minister showed a positive stance towards raising the salary limit, though the matter of lifetime membership remains undecided.

A six-member sub-committee was appointed by the ESI Corporation last year to examine the salary limit increase. BMS leader V. Radhakrishnan had proposed raising the limit to Rs 45,000, arguing that state-specific salary increases from 2017 should be considered.

ESI benefits

ESI members and their beneficiaries are entitled to medical treatment worth up to Rs 10 lakh per annum, with additional amounts sanctioned in special cases. The scheme is funded by diverting four percent of the total salary of members, with employees contributing 0.75 percent and employers covering the remaining 3.25 percent. Nationwide, there are 159 ESI hospitals, with 102 run by states and the rest directly by the corporation.