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Wednesday, 29 March 2017

Gazetted Notification on Maternity Benefit with Extended Leave

The Central Government, in its latest notification on Maternity Benefits has made a significant change to the leave granted to mothers allowing them a grant of 26 weeks, as opposed to the previous 12 weeks. This is applicable to all mothers who have less than two surviving children.

There have also been other additions made to this Act, which include:

·         The definition of a commissioning mother, meaning a biological mother who uses her egg to create an embryo implanted in any other woman;

·         Provisions for women who legally adopt a child, whereby A woman who legally adopts a child below the age of three months or a commissioning mother shall be entitled to maternity benefit for a period of twelve weeks from the date the child is handed over to the adopting mother or the commissioning mother, as the case may be;

·         The provision to work from home: In case where the nature of work assigned to a woman is of such nature that she may work from home; the employer may allow her to do so after availing of the maternity benefit for such period and on such conditions as the employer and the woman may mutually agree.

·         The introduction of crèche facilities has also been another important provision. According to the notification,

(1) Every establishment having fifty or more employees shall have the facility of crèche within such distance as may be prescribed, either separately or along with common facilities: Provided that the employer shall allow four visits a day to the crèche by the woman, which shall also include the interval for rest allowed to her.

(2) Every establishment shall intimate in writing and electronically to every woman at the time of her initial appointment regarding every benefit available under the Act.

In a further amendment made to the Maternity Benefit Act, a new notification declares that the changes shall come into effect from 1st April 2017, while sub-section(5) of Section 3 shall come into effect from 1st July, 2017.

While no certain guidelines for crèche facilities have been laid down in this Act, the same can be borrowed from the Factories Act, which lays down guidelines for crèche facilities as under:

(1)    In every factory, wherein more than thirty women workers are ordinarily employed there shall be provided and maintained a suitable room or rooms for the use of children under the age of six years of such women.

(2)    Such rooms shall provide adequate accommodation, shall be adequately lighted and ventilated, shall be maintained in a clean and sanitary condition and shall be under the charge of women trained in the care of children and infants.

(3)    The State Government may make rules-
(a) prescribing the location and the standards in respect of construction, accommodation, furniture and other equipment of rooms to be provided under this section ;
(b) requiring the provision in factories to which this section applies of additional facilities for the care of children belonging to women workers, including suitable provision of facilities for washing and changing their clothing ;
(c) requiring the provision in any factory of free milk or refreshment or both for such children ;
(d) requiring that facilities shall be given in any factory for the mothers of such children to feed them at necessary interval.

The official gazette notification can be viewed at

The notification declaring the date of applicability can be viewed at

Tuesday, 14 March 2017

Technical problems for regular online compliances of ESI & Provident Funds

Date: 14/03/2017

*Shri.Narendra Modi,
Honorable Prime Minister of India,
152, South Block, Raisina Hill, New Delhi-110011*

*Sub: Technical problems for regular online compliances of ESI & Provident Funds*

Respected Sir,
This is regarding the technical problems we are facing in routine online compliances of Employees State Insurance Corporation (ESI) and Employees’ Provident Fund Organisation (EPFO).

We are practicing consultants from Mumbai and present PAN India,  actively helping both the departments of ESIC & EPFO in proper implementation of the both the schemes.

Considering the recent major changes that have taken place in online statutory compliances of ESI & PF, we wish to bring to your kind notice; the problems, establishment governed by ESI & EPF Act, face. In spite of regular complaints from several employers, ESI Corporation as well as EPFO is either not finding the solutions against these complaints OR lacking enthusiasm in solving them. We therefore no alternative but to approach your office.

*Problems faced on ESIC Portal:*
For your reference we are giving some points regarding ESI compliances and changes happened in recent past:
1. From 01/08/2016 ESI Corporation has implemented the ESI Act for some new areas in the country and accordingly more establishments have come under the purview of this Act.
2. Accordingly since Aug-16 due to the increased work load ESI online portal is not responding for regular compliances and as a consultant we could not complete the necessary online registration procedures in time and pay the contributions for Aug-16 before the due date i.e.21/09/2016 for our clients.
3. Similarly with effect from Jan-17, wage limit for the applicability of ESI scheme is increase from Rs.15000/- to Rs.21000/- and this time also we have faced the same problem on this portal.  It is not responding, even if sometimes it responds, it stops working without any reason.
4. When we have raised the complaint through our clients (employers) on email ID provided on ESIC portal, instead of giving the solutions ‘IT care’ of ESIC is asking the employer to change the settings of their computers, and after changing the settings we find the problem continues.

*Our concerns about ESI Portal and online compliances are as under:*
1. First of all on google search for the ESIC portal, shows the result as ‘Incompatible Browser’, here one can understand the problem of this portal.
2. This portal behaves very weird and is not working as per expectations. Sometimes it works on the same machine and on the same browser recommended by ESIC, but in next session it doesn’t works. This is an irritating experience.  So there is a lots of work to be done in connection with Browser compatibility.
3. It is also noticed that the security certificate which is required to run the https: portal is not upgraded since Feb-16, i.e. pending about one year now.  
4. As far as the addition of newly implemented area is concerned, in the event when this portal was already having so many technical problems and not having the servers with required capacity why they have implemented the ESI Scheme to new areas and also increased the wage limit without increasing the server capacity and other infrastructure?
5. For the  payment of monthly contributions, when there is due date laid down in the ESI Act, and for any late payments Employers are required to pay the penal interest and damages, who is responsible for the non compliances resulted due to technical problems of ESI portal? We expect that such interest and damages should be waived for the period Aug-16 onwards till the portals functions smoothly.
6. From the month of Feb-17, ESI has given an option of two different rates of contributions for the employers falling in the newly implemented areas i.e. for the employers in newly implemented areas ESI contribution rate is reduced to 1% as employees’ share & 3% as employer’s share (total contribution@ 4%) for first 24 months, whereas for their  employers’ falling in the old areas are liable for the contribution rate of 1.75% +4.75%=Total 6.5%. For these changes on ESI portal, those who have submitted their request for this reduced rate, it still calculates with higher rate.
7. Process of Insured Person (IP) registration for obtaining ESI Insurance number has become time consuming and should be simplified with the facility for uploading the data in text or excel format. On ESI portal for the employers’ having higher labour turnover, process of IP registration has become very time consuming and tedious job.
8. In the event when online websites of other Govt. Department s i.e. Income Tax, Sales Tax OR highly secured websites of hundreds of Banks operating in the country are running properly with lakhs of users per minute, and to run the same no one is asking to change any setting of end user, what type of website ESI has developed; which frequently asks for, to change the setting and deploy certificates?
9. When Government of India  has launched ‘Digital India’ project to simplify the things for end users, we find the ESI portal as a nightmare to make the routine compliances and now it is high time to improve and simplify the process of this portal.
10. In the past it is observed that at the time of making major changes in the method of compliances,ESI department never takes and practical view. No practical guidance appears to have been taken from the experienced men in the field.

Problems faced on EPFO’s ‘Unified Portal’:

*For your reference we are giving some points regarding PF compliances and changes happened in resent past:*
1. For the online PF compliances on 6th Apr-2012, for the first time EPFO has introduced their portal ‘Employer E-Seva’ and subsequently in Jul-2014 they have allotted UAN to all the PF members and for UAN services, with the introduction of ‘Online Transfer Claim Portal’ (OTCP). E-Seva was working properly but on OTCP portal for UAN linking many problems have been faced.
2. To rectify these problems of UAN linking on OTCP portal, on 17th Dec-2016 both the portals have been scrapped and on 23rd Dec-16, EPFO has introduced ‘Unified Portal’ for all the UAN based compliances. Scrapping of two different portals is a major failure of EPFO department.
3. In this process it is observed that, two or more different UAN have been allotted to one member. Whereas EPFO has earlier announced that, UAN will be a single & unique identity for the PF member. This has created panic among members on the sensitive issue of their provident funds, because most of the members have already activated there earlier UAN with completion of KYC procedure!

*Our concerns about ‘Unified Portal’ and online compliances of PF are as under:*
1. From the date of introduction of this portal it is not working properly and during the normal office hours users are unable to login on the same. This might be a problem of server capacity. Due to this problem on 12th Jan-17 EPFO has allowed a grace period for the payment of contribution till 20/01/2017. This could have been avoided with prior testing of the portal before introduction for direct compliances on pan India level. This period of 5 days was not at all sufficient considering the capacity of portal and congestion.
2. For the online process of few minutes this portal is taking hours. Now it is more than two months have passed from the date of introduction, portal is still not working to its expected capacity and most of the time we are unable to logon to the same for the statutory PF compliances.
3. In earlier process for the assistance in data processing EPFO have provided a tool on their website, but this time such tool is missing.
4. In the process of statutory compliances of PF, establishments are paying heavy amounts towards the PF contributions, and for any delay minimum 17% of penal interest and damages is imposed. Who is responsible for the lapses in the introduction of new systems? In the past things could be done manually. Now neither manually nor online compliance can be made, as portal is not working as expected. Hapless establishments therefore no way but to succumb to interest penalties and damages, without their faults.  
5. For above mentioned difficulties if we telephone on the number given on the portal, there is always ‘No Reply’. If we try to raise any of the points mentioned in this letter on the email ID give on the portal, it never replied.
6. Both the department coming under your Labour Ministry, have started the amnesty scheme with good intention to enrol maximum number of employees under this social security scheme. There are establishments who have never applied for Provident Fund registration. They want to take advantage of this amnesty scheme and want to register themselves. But as the portal for online registration is also not functioning and employers are prevented from registration. Consequently even though an employer wants to register and give PF benefits to his employees, he can’t do so. The time span for the amnesty scheme is from 1st Jan2017 to 31st of March-2017 out of which two months have already passed without any fruit full end.
7. We also want to bring your kind notice that even though it is your effort to settle the PF claims of the members on the same day of submission of claim. Practically of you enquire, you will find that since last one month, large number of claims have not been settle for one difficulty or other in the new internal system of EPFO.

Sir, we are very much pleased with your earnest and relentless efforts to reduce corruptions and encourage ease of doing business. ESI and PF portals are not coming to terms of your good intention.

We hope you will personally look into the matter, verify the facts and take appropriate decision in the matter.
We promise that, our association will always support your sincere efforts to improve the systems of our country.
Thanking you,

Yours faithfully,

Pratik Vaidya