ESI Coverage of establishments in UT of Andaman and Nicobar Islands

## Policy Analysis Report: Extension of Provisions under the Employees State Insurance Act, 1948 **1. Executive Summary:** This report analyzes a notification issued by the Ministry of Labour and Employment, Government of India, regarding the extension of provisions under the Employees State Insurance (ESI) Act, 1948. The notification (S.O. 1377(E)) announces the Central Government's intention, in consultation with the Employees State Insurance Corporation, to extend the ESI Act to specific classes of establishments in the Union territory of Andaman and Nicobar Islands. The key finding is the expansion of ESI coverage to establishments employing ten or more persons, including shops, hotels, restaurants, road motor transport establishments, cinemas, newspaper establishments, educational institutions, and medical institutions within the specified region. This report details the scope of this extension and its potential implications. **2. Introduction:** The purpose of this report is to provide a comprehensive overview and analysis of the notification issued by the Ministry of Labour and Employment concerning the extension of the Employees State Insurance Act, 1948, based solely on the information provided in the text. This analysis aims to inform stakeholders, particularly those in the affected industries, about the scope, implications, and expected outcomes of this extension. **3. Policy Overview:** * This is a notification extending the provisions of the Employees State Insurance Act, 1948 (Act 34 of 1948). * **Core Objective:** The primary objective, inferred from the text, is to extend social security benefits under the ESI Act to a broader range of employees working in specified establishments within the Union territory of Andaman and Nicobar Islands. This is achieved by expanding the coverage of the Act to include these establishments. **4. Background and Rationale:** This notification extends the existing Employees State Insurance Act, 1948. The rationale behind this specific extension is to provide social security coverage to employees in various sectors within the Union territory of Andaman and Nicobar Islands. The included sectors suggest a focus on broadening the safety net to workers in common service industries, media, education and healthcare. **5. Key Provisions / Changes:** This notification is not an amendment to the *text* of the ESI Act itself, but rather an *extension* of its existing provisions to new establishments. The *key change* is the *expansion of coverage* to: * The following establishments wherein ten or more persons are employed, on any day of the preceding twelve months: * Shops * Hotels * Restaurants * Road motor transport establishments * Cinemas including preview theatres * Newspaper establishments as defined in clause d of section 1 of the Act. section 2 of the Working Journalists and Other Newspaper Employees Conditions of Service and Miscellaneous Provisions Act, 1955 45 of 1955; * Educational Institutions including public, private aided or partially aided run by an individual, trust, society or other organisation; * Medical institutions including corporate, joint sector, trust, charitable and private ownership hospitals, nursing homes, diagnostic centres and pathological labs. This change affects establishments within the areas of the Union territory of Andaman and Nicobar Islands where the provisions of the Employees State Insurance Act, 1948 have already been brought into force under subsection 3 of section 1 of the Act. These establishments will now be required to comply with the ESI Act, including contributions and benefit provisions, for their employees. **6. Target Audience and Stakeholders:** The primary target audience and stakeholders include: * Owners and managers of shops, hotels, restaurants, road motor transport establishments, cinemas, newspaper establishments, educational institutions, and medical institutions within the specified areas of the Union territory of Andaman and Nicobar Islands. * Employees working in these establishments. * The Employees State Insurance Corporation (ESIC). * The Ministry of Labour and Employment. **7. Implementation Aspects (Inferred):** * **Responsible agency:** The Employees State Insurance Corporation (ESIC) is responsible for implementing and administering the ESI Act. The Ministry of Labour and Employment is the overseeing body. * **Timeline:** The extension will come into effect on or after one month from the date of publication of the notification in the Official Gazette (March 28, 2022). * **Procedure:** The notification includes a provision for receiving objections or suggestions from any person regarding the extension within the specified period. These objections and suggestions can be addressed to Shri Madan Chaurasia, Under Secretary, Ministry of Labour and Employment, at the provided address and email. The Central Government will consider these objections and suggestions. **8. Expected Outcomes / Impact of Changes:** The intended outcome of this extension is to: * Provide social security benefits, including medical, cash, and other benefits, to a larger segment of the workforce in the specified establishments within the Union territory of Andaman and Nicobar Islands. * Increase compliance with labor laws and improve the overall welfare of employees in the region. * Potentially increase administrative burden and costs for employers who are newly brought under the purview of the ESI Act, as they will need to comply with contribution and reporting requirements. * Improved healthcare access for employees and their families. **9. Conclusion:** The notification regarding the extension of the Employees State Insurance Act, 1948, to specific establishments in the Union territory of Andaman and Nicobar Islands represents a significant step toward broadening social security coverage. The inclusion of shops, hotels, restaurants, road transport, cinemas, newspaper establishments, educational and medical institutions indicates a commitment to ensuring the welfare of a wider range of employees. This extension is likely to have a positive impact on the lives of covered employees, while also requiring affected employers to comply with the provisions of the ESI Act.

Key Entities Referenced