ESI is most beneficial to the employees. It is also a statutory coverage for the employer, the risk of any accidents arising out of the course of the employment and once the employee is covered, the employer's liability under the Workmen's Compensation Act (now renamed as Employee's Compensation Act) is absolved.

From the point of medical benefit, leave benefit and disability benefit, compensation etc., ESI is the best benefit for an employees. Historically ESI was seen as a typical circari system but now a days, they have the best benefits, some private health care cannot provide.

For an instance, an employee of 30 years lost his life in an accident while travelling to his work place. Thanks to ESI coverage, his family (elderly parents) would get a benefit of Rs.3000 p.m., life long. 

Vasudevan

Dear Deepak,

Any employer who provides similar benefit whatever provides by ESIC so he can go for exemption of ESIC Norms.

Rgds

Mr. Vasudevan has given valuable advice. Kindly follow it.

Your friend may have many employees which are travelling class.

The essence is "in receipt of social security benefits substantially similar or superior to the benefits provided under the ESI Act." The exemption is max. for 1 year.

Read

XXI. b :  EXEMPTIONS

Sec 87 to 90 and also amendments ,introduction of sec91AA.

"

In fact, the benefits that are not provided by the employer, but, available only under the ESI Scheme like:  Medical benefits provided to superannuated employees, vocational Rehabilitation Scheme, Unemployment Relief provided under the Act, long term Benefits like PDB,DB. need to be clearly brought to focus in the comments furnished to the Government."

ESIC is applicable to self and spouse post retirement, in case of dismissal.

‘Only Centre can grant exemption from ESI Act'. There may be inspections and each year you shall have to apply for renewal.

The other insurance you are looking at may cover hospitalisation and treatment. ESI provides free treatment and medicines for minor ailments.Very few companies can afford to privide similar or better infrastructure without having a big dent on their profits.A network of external doctors e.g. GP's, specialist like dentist,surgeon, rehabilitation centres,NH,Hospitals etc may be required.This may be wrothwhile for strength of employees ranging to a few thousand at each location. The number of employees mentioned by you are a few hundered scatterred at different locatins.A whole dept. may be required to handle the enormous task.

If ESIC accepts such requests from private comapnies it shall be a huge loss of revenue.

Company may pay both employers and employee's contribution.

As a HR personnel you need to go thru the various benefits and explain these to employees and employer. Employees shall love and adore for this effort. You may avail the services of personnel experienced with ESIC.