SOCIAL SECURITY CODE

CHACO P J , AIMS
 Percentage Distribution of Workers according to Usual Status (Principal status+subsidiary status) by
kind of employment during 2017-18
Category of Employment

Self Employment Regular/Wa Casual

ge salary labour

Own Helper in All self-

account household employed
worker & enterprise
employer

Male 44.1 8.2 52.3 23.4 24.3

Female 20.2 31.7 51.9 21 27
Persons 38.6 13.6 52.2 22.8 24.9
Source: PLFS (2017-18)
• Large and growing informal sector (90%);
•Low female participation (the PLFS 2017-18 shows continuation of declining trend of FLFPR with the coming down of rural
women since 2011-12, to 25 % from 28% , whereas for urban women, the rate has remained the same at about 20 %)

CHACO P J , AIMS
 What is social security?

Unemployment Employment
Maternity Sickness / Ill
Health Injury
Families with Invalidit Death of Breadwinner Old Age
Children y

People face contingencies in life and these have financial implications.

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 What is social security?

Social security is a Human Right

(Article 22, Universal Declaration of human
rights)

- Flagship Convention 102 (1952)

- Recommendation 202 (2012)
Reaffirms universal right to social security

Social security is the protection that a society provides to individuals and

households to ensure access to health care and to guarantee income
security, particularly in cases of old age, unemployment, sickness,
invalidity, work injury, maternity or loss of a breadwinner.
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 SOCIAL SECURITY CODE
• As defined in the SS Code:
▫ "social security" means the measures of protection
afforded to employees, unorganised workers, gig
workers and platform workers to ensure access to
health care and to provide income security,
particularly in cases of old age, unemployment,
sickness, invalidity, work injury, maternity or loss of a
breadwinner by means of rights conferred on them
and schemes framed, under this Code.

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 Some Definitions
• Employee: It has been defined as any person (other than an apprentice
engaged under the Apprentices Act, 1961) employed on wages by an
establishment, either directly or through a contractor, to do
any skilled, semi-skilled or unskilled, manual, operational,
supervisory, managerial, administrative, technical, clerical or
any other work, whether the terms of employment be express
or implied.
• Inter-state Migrant Worker means a person who is employed in an
establishment and who— (i) has been recruited directly by the
employer or indirectly through contractor in one State for
employment in such establishment situated in another State; or
(ii) has come on his own from one State and obtained
employment in an establishment of another State (hereinafter
called destination State) or has subsequently changed the establishment
within the destination State, under an agreement or other arrangement
for such employment and drawing wages not exceeding eighteen
thousand rupees per month or such higher amount as may be
notified by the Central Government
CHACO P from time to time;
J , AIMS
 Some Definitions
• "Self-employed Worker" means any person
who is not employed by an employer, but
engages himself in any occupation in the
unorganised sector subject to a monthly earning
of an amount as may be notified by the Central
Government or the State Government, as the
case may be, from time to time or holds
cultivable land subject to such ceiling as may be
notified by the State Government.

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 Some Definitions
• "Unorganised Sector" means an enterprise
owned by individuals or self-employed workers and
engaged in the production or sale of goods or
providing service of any kind whatsoever, and where
the enterprise employs workers, the number of such
workers is less than ten;
• "Unorganised Worker" means a home-based
worker, self-employed worker or a wage worker in
the unorganised sector and includes a worker in the
organised sector who is not covered by the Industrial
Disputes Act, 1947 or Chapters III to VII of this
Code;
CHACO P J , AIMS
 THE CODE ON SOCIAL SECURITY, 2020
(NO. 36 of 2020)
• Introduced Lok Sabha Sep 19, 2020

• Passed Lok Sabha Sep 22, 2020

• Passed Rajya Sabha Sep 23, 2020

• Assent President of India Sep 28, 2020

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 Amalgamated Labour Laws under Social Security Code
1. The Employees’ Compensation Act, 1923
2. The Employees’ State Insurance Act, 1948
3. The Employees Provident Fund and Miscellaneous
Provisions Act, 1952
4. The Employment Exchanges (Compulsory Notification of
Vacancies) Act, 1959;
5. The Maternity Benefit Act, 1961
6. The Payment of Gratuity Act, 1972
7. The Cine Workers Welfare Fund Act, 1981
8. The Building and Other Construction Workers Welfare Cess Act,
1996
9. The Unorganised Workers’ Social Security Act, 2008
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 Social Security Code in Brief

Chapter No. Chapter Heading Sections

Chapter I Preliminary 1-3
Chapter II Social Security Organisations 4-13
Chapter III Employees’ Provident Fund 14-23
Chapter IV Employees State Insurance Corporation 24-52
Chapter V Gratuity 53-58
Chapter VI Maternity Benefit 59-72
Chapter VII Employee's Compensation 73-99
Chapter VIII Social Security And Cess In Respect Of Building And 100-108
Other Construction Workers
Chapter IX Social Security For Unorganised Workers, Gig 109-114
Workers And Platform Workers
Chapter X Finance And Accounts 115-121
Chapter XI Authorities, Assessment, Compliance And Recovery 122-132
Chapter XII Offences And Penalties) 133-138
Chapter XIII Employment Information And Monitoring 139-140
Chapter XIV Miscellaneous 141-164
 Applicability of the Schemes
Chapter No. Chapter Heading Applicability

III Employees' Provident Fund Every establishment in which twenty or more

employees are employed.
IV Employees’ State Insurance Every establishment in which ten or more
persons are Corporation employed other than a
seasonal factory
V Gratuity (a) every factory, mine, oilfield, plantation, port
and railway company; and (b) every shop or
establishment in which ten or more employees
are employed, or were employed, on any day of
the preceding twelve months; and such shops or
establishments as may be notified by the
appropriate Government from time to time.

VI Maternity Benefit (a) to every establishment being a factory, mine

or plantation including any such establishment
belonging to Government; and (b) to every shop
or establishment in which ten or more employees
are employed, or were employed, on any day of
the preceding twelve months; and such other
shops or establishments notified by the
appropriate Government.
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 Applicability of the Schemes
Chapter Chapter Heading Applicability
No.
VII Employee's Subject to the provisions of the Second
Compensation Schedule, it applies to the employers
and employees to whom Chapter IV
does not apply.
VIII Social Security and Every establishment which falls under
Cess in respect of the building and other construction
Building and Other work.
Construction Workers

IX Social Security for Unorganised sector,

Unorganised Workers' unorganised workers', gig worker,
platform worker.

XIII Employment Career centres, vacancies, persons

Information and seeking services of career centres and
Monitoring employers. CHACO P J , AIMS
 CHAPTER III - EMPLOYEES PROVIDENT
FUND
Applicability:
•As specified in the First Schedule, the provisions of Chapter III – Employees Provident Fund will be
applicable to every establishment in which twenty or more employees are employed

Section 14: Appointment of Appointment of officers of Central Board Section 15: Schemes
•(a) frame a scheme to be called the Employees' Provident Fund Scheme for which the provident funds shall be
established for employees and specify the establishments or class of establishments to which the said scheme
shall apply
• (b) frame a scheme to be called the Employees' Pension Scheme for the purpose of providing for—

(i) superannuation pension, retiring pension or permanent total disablement pension to the employees of any
establishment or class of establishments to which this Chapter applies;
(ii) widow or widower's pension, children pension or orphan pension payable to the beneficiaries of such
employees;
• (c) frame a scheme to be called the Employees' Deposit Linked Insurance Scheme for providing life insurance
benefits
• (d) modify any scheme referred to in clauses (a), (b) and (c) by adding thereto, amending or varying therein,
either prospectively or retrospectively

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 CHAPTER III - EMPLOYEES PROVIDENT
FUND
Section 16: Funds
(1) The Central Government may, for the purposes of—
•(a) Provident Fund Scheme, establish a Provident Fund where the contribution
paid by the employer shall be ten per cent. of the wages payable to each of the
employees (whether employed by him directly or by or through a contactor), and
the employee's contribution shall be equal to the contribution payable by the
employer in respect of him

•(b) Pension Scheme, establish a pension fund in respect of every employee who is
a member of the Pension Scheme and such sums from the employer's contribution
not exceeding eight and one- third per cent. of the wages

•(c) Insurance Scheme into which shall be paid by the employer from time to time
in respect of every such employee in relation to whom he is the employer, such
amount, not being more than one per cent. of the wages or such per cent. of wages
as may be notified by the Central Government

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 CHAPTER III - EMPLOYEES PROVIDENT
FUND in respect of employees and contractors
Section 17: Contribution
•The amount of contribution employers’ as well as the employee's contribution any charge for
meeting
the cost of administering the Fund paid or payable by an employer or through a contractor by
the
employer
•No
contract
or can
deduct
the
employe
r's
contribu
tion
from the
wages
payable
to an
employe
e
employe
d by or
through
him or
otherwise CHACO P J , AIMS
to
 CHAPTER IV – EMPLOYEES STATE INSURANCE CORPORATION

Applicability:
•As specified in the First Schedule – Every establishment in which ten or more employees
are employed other than a seasonal factory:
•shall also be applicable to an establishment, which carries on such hazardous or life
threatening occupation
•employer of a plantation, may opt ESIC benefits where the benefits available are better
than what the employer is providing

Section 24: Appointment of Principal Officers and other staff

Section 25: Employees‘ State Insurance Fund –
Section 28: All employees to be insured. Section 29: Contributions –
• The contribution payable under this Chapter in respect of an employee shall comprise of
employer's
• Contribution employee's contribution, paid to the Corporation.
• The contributions rates to be prescribed by the Central Government.
• The wage period in relation to an employee shall be the unit in respect of which all contributions
shall be payable under this Chapter.

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 CHAPTER IV – EMPLOYEES STATE INSURANCE CORPORATION

Section 31: Provisions as to payment of contributions by employer, etc.

•The employer shall pay in respect of every employee, whether directly employed by him or by or through a
contractor, both the employer's contribution and the employee's contribution.
• Neither the employer nor the Contractor shall be entitled to deduct the employer's contribution from any
wages payable to an employee or otherwise to recover it from him.

Section 32: Benefits:

•The insured persons, their dependents are entitled to the the following benefits —
• (a) sickness benefit in case of his sickness certified by a duly appointed medical practitioner,
• (b) maternity benefit to an insured person being a woman in case of confinement or miscarriage or
sickness arising out of pregnancy, confinement, premature birth of child or miscarriage,
• (c) disablement benefit to an insured person suffering from disablement as a result of an
employment
injury sustained by him as an employee),
• (d) dependants‘ benefit to the dependants of an insured person who dies as a result of an
employment injury sustained by him as an employee,
• (e) medical benefit for and attendance on insured persons,
•(f ) funeral expenses to the eldest surviving member of the family of an insured person who has died,
towards the expenditure on the funeral of the deceased insured person

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 CHAPTER IV – EMPLOYEES STATE INSURANCE CORPORATION

Section 33: Corporation's power to promote measures for insured persons in terms of
health and welfare such as rehabilitation and re-employment of insured persons who
have been disabled or injured etc.

Section 34: an accident arising in the course of an employee's employment shall be

presumed, in the absence of evidence, to have arisen out of that employment.

Section 35. An accident shall be deemed to arise out of and in the course of an
employee's employment notwithstanding that he is at the time of the accident acting in
contravention of the provisions of any law applicable to him, or of any orders given by or
on behalf of his employer or that he is acting without instructions from his employer

Section 36: Occupational disease –

• If an employee contracts any disease peculiar to that employment be deemed to be an "employment
injury " arising out of and in the course of employment.
•No benefit shall be payable to an employee in unless the disease is directly attributable to a specific injury
arising out of and in the course of his employment.

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 CHAPTER IV – EMPLOYEES STATE INSURANCE CORPORATION

Section 38: Dependants‘ benefit-

•If an insured person dies as a result of an employment injury, dependants' benefit shall be payable to
his dependents.

Section 39: Medical benefit –

•An insured person or where benefit is extended to his family, shall be entitled to
receive medical benefit.
•Such medical benefit may be given either in the form of out-patient treatment and
attendance in a hospital or dispensary, clinic or other institution

Section 42: Corporation's rights when an employer fails to register, etc,

then, the Corporation may, on being satisfied in the manner prescribed by
the Central Government that the benefit is payable to the employee, pay to
the employee benefit at such rate to which he is entitled, and the
Corporation recover the amount from the employer

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CHAPTER IV – EMPLOYEES STATE INSURANCE CORPORATION

Section 45: Schemes for unorganized workers, gig workers and platform
workers and the members of their families frame scheme for providing
benefits admissible under this Chapter by the Corporation.

Sections 48 & 49: Constitution of Employees‘ Insurance Court and in

case
of any dispute, matters to be decided by Employees‘ Insurance Court.

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 CHAPTER V -GRATUITY
Applicability:
(a) every factory, mine, oilfield, plantation, port and railway company; and
(b)every shop or establishment in which ten or more employees are employed, or were employed, on
any day of the preceding twelve months; and such shops or establishments as may be notified by the
appropriate Government from time to time.

Section 53: Payment of gratuity

•Shall be payable to an employee on the termination of his employment after he has rendered continuous
service for not less than five years,—
(a) on his superannuation; or (b) on his retirement or resignation; or (c) on his death or disablement
due to accident or disease; or (d) on termination of his contract period under fixed term
employment; or
•For every completed year of service or part thereof in excess of six months, the employer shall pay
gratuity to an employee at the rate of fifteen days' wages or as notified by the Central Government, based
on the rate of wages last drawn by the employee concerned:
•For the purpose of computing the gratuity payable to an employee who is employed, after his
disablement, on reduced wages, his wages for the period preceding his disablement shall be taken to be
the wages received by him during that period, and his wages for the period subsequent to his
disablement shall be taken to be the wages as so reduced.
•a) the gratuity of an employee, whose services have been terminated for any act, wilful omission or
negligence causing any damage or loss to, or destruction of, property belonging to the employer, shall be
forfeited to the extent of the damage or loss so caused; or the gratuity payable to an employee may be
wholly or partially forfeited. CHACO P J , AIMS
 CHAPTER V -GRATUITY

Section 54: Continuous service-

•an employee shall be said to be in continuous service for a period if he has, for
that period, been in uninterrupted service, including service which may be
interrupted on account of sickness, accident, leave, absence from duty without
leave, lay-off, strike or a lock-out or cessation of work not due to any fault of the
employee

•where an employee is not in continuous service, he shall be deemed to be in

continuous service under the employer if the employee during the period of
preceding twelve calendar months has worked under the employer for not less
than 190 days in the case of any employee employed below the ground in a
mine or in an establishment which works for less than six days in a week; and
240 days, in any other case;

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 CHAPTER V -GRATUITY
Section 55: Nomination
•Each employee, who has completed one year of service, shall make, a nomination, distribute
the amount of gratuity payable to him amongst more than one nominee.
•Nomination shall be made in favour of one or more members of his family, and any
nomination made by such employee in favour of a person who is not a member of his family
shall be void.

Section 56: Determination of amount of gratuity

•A person who is eligible for payment of gratuity or any person authorisednon his behalf shall
send a written application to the employer, for payment of such gratuity.
•As soon as gratuity becomes payable, the employer shall, whether an application has been
made or not, determine the amount of gratuity and give notice in writing to the person to
whom the gratuity is payable and also to the competent authority specifying the amount of
gratuity so determined.
•The employer shall arrange to pay the amount of gratuity within thirty days from the date it
becomes payable
•If the amount of gratuity payable is not paid by the employer within the period specified, the
employer shall pay, from the date on which the gratuity becomes payable to the date on
which it is paid, simple interest at such rate notified by the Central Government
•In case of a dispute on amount payable or admissibility of any claim, the employer or
employee (raising the dispute) may make an application to the competent authority.

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 CHAPTER V -GRATUITY
Section 57: Compulsory insurance
• Every employer, other than an employer or an establishment under the
control of, the Central Government or a State Government, shall, obtain an insurance for
his liability for payment towards the gratuity, from any insurance company regulated by
the Authority of the Insurance Regulatory and Development Authority Act, 1999
•The appropriate Government may, exempt every employer who had already
established an approved gratuity fund in respect of his employees

Section 57: Competent Authority

•The appropriate Government may, by notification, appoint any person having such
qualifications and experience as may be prescribed by that Government to be a
competent authority for implementation of any provision of this Chapter

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 CHAPTER VI – MATERNITY BENEFIT
Applicability:
•a) to every establishment being a factory, mine or plantation including any such
Establishment belonging to Government; and
•(b) to every shop or establishment in which ten or more employees are employed, or were
employed, on any day of the preceding twelve months; and such other shops or
establishments notified by the appropriate Government.

Section 59: Employment of, or work by, women prohibited during certain period
•No employer shall knowingly employ a woman in any establishment during the six weeks
immediately following the day of her delivery, miscarriage or medical termination of
pregnancy,
•No pregnant woman shall, on a request being made by her, be required by her employer to
do during the period specified in sub-section (4), any work which is of an arduous nature or
which involves long hours of standing or which in any way is likely to interfere with her
pregnancy or the normal development of the foetus or is likely to cause her miscarriage or
adversely affect her health,
•The period referred to in sub-section (3) shall be—
• (a) the period of one month immediately preceding the period of six weeks, before the
date of her expected delivery;
• (b) any period during the said period of six weeks for which the pregnant woman does
not avail of leave of absence under section 62. 60.

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 CHAPTER VI – MATERNITY BENEFIT
Section 60: Right to payment of maternity benefit.
•every woman shall be entitled to, and her employer shall be liable
for, the payment of maternity benefit at the rate of the average daily
wage for the period of her actual absence.
•"the average daily wage" means the average of the woman's wages
payable to her for the days on which she has worked during the
period of three calendar months immediately preceding the date
from which she absents herself on account of maternity,
•No woman shall be entitled to maternity benefit unless she has
actually worked in an establishment for a period of not less than
eighty days in the twelve months immediately preceding the date of
her expected delivery.

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 CHAPTER VI – MATERNITY BENEFIT
Section 61: Continuance of payment of maternity benefit
•Every woman entitled to the payment of maternity benefit under this Chapter,

Section 62: Notice of claim for maternity benefit and payment thereof - to her
employer for maternity benefit and any other amount to which she may be
entitled
•In the case of a woman who is pregnant, such notice shall state the date from
which she will be absent from work, not being a date earlier than six weeks from
the date of her expected delivery
•The amount of maternity benefit for the period preceding the date of her
expected delivery shall be paid in advance by the employer to the woman on
production of such proof that the woman is pregnant, and the amount due for the
subsequent period shall be paid by the employer to the woman within forty-eight
hours of production of such proof
•The failure to give notice under this section shall not disentitle a woman to
maternity benefit or any other amount under this Chapter.

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 CHAPTER VI – MATERNITY BENEFIT
Section 63: Payment of maternity benefit in case of death of a woman –
•to the person nominated by the woman in the notice .

Section 64: Payment of medical bonus - of three thousand five hundred rupees if no pre-natal
confinement and post-natal care is provided for by the employer free of charge

Section 65: Leave for miscarriage, etc. –

•entitled to leave with wages for a period of six weeks

Section 66: Nursing breaks –

•in addition to the interval for rest, two breaks for nursing the child until the child attains the
age of fifteen months.

Section 67: Creche facility –

•every establishment in which fifty shall have the facility of crèche
•employer shall allow four visits a day to the crèche by the woman, which shall also include the
intervals of rest allowed to her.
•Note: - From a practical point of view, there may be situations wherein only one or two
employee intends avail these benefits. In such situation, the recurring cost of providing such
facilities to the employer may be very high. Therefore, there can be a proviso for a fixed
amount in lieu of creche facilities to the employees.

CHACO P J , AIMS
 CHAPTER VI – MATERNITY BENEFIT
Section 68: Dismissal for absence during pregnancy –
• When a woman absents herself from work in accordance with the provisions of this Chapter, it shall be unlawful
for her employer to discharge or dismiss her on account of such absence
•discharge or dismissal of a woman during her pregnancy shall not have the effect of depriving her of the maternity
benefit or medical bonus

Section 69: No deduction of wages –

•(a) the nature of work assigned to her by virtue of the provisions contained in section 59; or (b) breaks for nursing
the child allowed to her under the provisions of section 66

Section 70: Forfeiture of maternity benefit –

• to a woman who works for remuneration during the period she has been permitted by an employer to absent
herself for availing the maternity benefits

Section 71: Duties of employer –

•An abstract of the provisions in local language shall be exhibited in every part of the establishment in which
women are employed..

Section 72: Power of Inspector- cum- Facilitator to direct payments to be made

•to any woman claiming that,— (a) maternity benefit or any other amount to which she is entitled has been
improperly withheld; (b) her employer has discharged or dismissed her during or on account of her absence from
work
•Any person aggrieved by the order of the Inspector-cum-Facilitator may, within thirty days appeal to the authority
prescribed by the appropriate Government.
 CHAPTER VII - EMPLOYEE'S COMPENSATION
Applicability:
•Subject to the provisions of the Second Schedule, it applies to the employers and employees
to whom chapter IV (ESIC) does not apply.
Section 73: Reports of fatal accidents and serious bodily injuries –
•Notice to competent authority, of any accident occurring on his premises which results in
death or serious bodily injury, within seven days of the death or serious bodily injury, giving
the circumstances attending the death or serious bodily injury
Section 74: Employer's liability for compensation
•If personal injury is caused to an employee by accident or an occupational disease listed in the
Third Schedule arising out of and in the course of his employment, his employer shall be liable
to pay compensation
Section 75,76: Compensation in case of death of or injury in plantation

Section 78: Method of calculating monthly wages for purposes of compensation Section 81:

Distribution of compensation –
•No payment of compensation in respect of an employee whose injury has resulted in death,
and no payment of a lump sum as compensation shall be made otherwise than by deposit
with the competent authority.

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 CHAPTER VII - EMPLOYEE’S COMPENSATION

Section 82: Notice and claim

•No claim for compensation shall be entertained by a competent authority unless notice of the
accident has been given
Section 83: Special provisions relating to accidents occurring outside Indian territory.
•apply in case of employees who are— (a) masters of ships or seamen; (b) captain and other
members
of crew of aircraft; (c) persons recruited by companies registered in India and working as such
abroad;
(d) persons sent for work abroad
Section 84: Medical examination
• Where an employee has given notice of an accident, he, shall, if the employer,

before the expiry of three days from the time at which service of the notice has been
effected, offers to have him examined free of charge by a medical practitioner, submit himself
for such examination, and any employee who is in receipt of a half-monthly payment under
this Chapter shall, if so required, submit himself for such examination from time to time
Section 85: Contracting
Where any employer contracts with contractor for the execution whole or any part
of any work which is ordinarily part of the trade or business, the employer shall be liable to

pay to any employee employed in the execution of the work any compensation, and that the
amount of compansation shall be calculated with reference to the wages of the employee
under the employer by whom he is immediately employed.
 CHAPTER VII - EMPLOYEE’S COMPENSATION

Section 88: Power to require from employers statements -regarding fatal accidents,
within 30 days of serving of notice by competent authority

Section 91: Appointment of competent authority.

• The State Government may, by notification, appoint any person who is or has been a
member of a State Judicial Service, or an advocate or a Gazetted Officer having
educational qualifications and experience, for not less than five years.

Section 94: Power of competent authority to require further deposit in cases of fatal
accident – with regard to compensation payable in respect injury resulted in death,
and in the opinion of the competent authority such sum is insufficient

Section 95: Powers and procedure of competent authority. Section 99: Appeal against

order of competent authority

CHACO P J , AIMS
CHAPTER VIII
SOCIAL SECURITY AND CESS IN RESPECT OF BUILDING AND
OTHER CONSTRUCTION WORKERS
• "building or other construction work" means the construction,
alteration, repair, maintenance or demolition in relation to buildings,
streets, roads, railways, tramways, airfields, irrigation, drainage,
embankment and navigation works, flood control works (including storm
water drainage works), generation, transmission and distribution of
power, water works (including channels for distribution of water), oil and
gas installations, electric lines, internet towers, wireless, radio, television,
telephone, telegraph overseas communications,
and reservoirs, dams, canals, tunnels, bridges,
watercourses,
pipelines, viaducts,
towers, cooling towers, aqua-ducts,
transmission towers and such other
work as may be specified in this behalf by the Central Government, by
notification,
• But does not include any building or other construction work of any
factory or mine or any building or other construction work employing less
than ten workers or any building or other construction work related to
own residential property not employing the workers more than such
number as may be notified by the Central Government from time to time;
CHAPTER VIII
SOCIAL SECURITY AND CESS IN RESPECT OF BUILDING AND
OTHER CONSTRUCTION WORKERS
• "building worker" means a person who is
employed to do any skilled, semi-skilled or
unskilled, manual, technical or clerical work for
hire or reward, whether the terms of such
employment are express or implied,
connection in with any building
constructionor other
work, but does not include
any such person who is employed mainly
in a managerial or supervisory or
administrative capacity;

CHACO P J , AIMS
CHAPTER VIII
SOCIAL SECURITY AND CESS IN RESPECT OF BUILDING
AND OTHER CONSTRUCTION WORKERS

• The number of construction worker in the country

is approximately 5.5 crore whereas only 3.5 crores
workers or 63% are registered with the Board.
• Building and other Construction Workers’
(Regulation of Employment and Conditions of
Service) Act, 1996 is subsumed in OSH & WORKING
CONDITIONS CODE
• This code subsumes Building and Other
Construction Workers Cess Act, 1996

CHACO P J , AIMS
CHAPTER VIII
SOCIAL SECURITY AND CESS IN RESPECT OF
BUILDING AND OTHER CONSTRUCTION WORKERS
• Section 100-108
• Section 100: Levy and collection of cess
▫ There shall be levied and collected a cess for the purposes of social security
and welfare of building workers at such rate not exceeding two per
cent but not less than one per cent of the cost of construction
incurred by an employer, as the Central Government may, by notification,
from time to time specify.
▫ The cost of construction shall not include:— (a) the cost of land; and (b)
any compensation paid or payable to an employee or his kin
under Chapter VII.
• Section 101: Interest payable on delay in payment of cess
• Section 102: Power to exempt from cess
▫ where such cess is already levied and payable under any corresponding law
in force in that State.
CHACO P J , AIMS
CHAPTER VIII
SOCIAL SECURITY AND CESS IN RESPECT OF BUILDING AND OTHER
CONSTRUCTION WORKERS

• Section 103: Self assessment of cess

▫ within sixty days or such period as may be notified by the appropriate
Government of the completion of his each building and other construction
work

• Section 104: Penalty for non-payment of cess within

the specified time

• Section 105: Appeal to appellate authority

▫ Any employer aggrieved by an order of assessment made under section 103 or
by an order imposing penalty made under section 104.

CHACO P J , AIMS
CHAPTER VIII
SOCIAL SECURITY AND CESS IN RESPECT OF BUILDING
AND OTHER CONSTRUCTION WORKERS
• Section 106: Registration of building
workers as
beneficiaries
▫ Every building worker who has completed eighteen years of age, but has
not completed sixty years of age, and who has been engaged in any
building or other construction work for not less than ninety days
during the preceding twelve months

• Section 107: Cessation as a beneficiary

▫ when a worker attains the age of sixty years or when she/he is not engaged
in building or other construction work for not less than ninety days in a
year.
▫ if a person had been a beneficiary for at least three years continuously
immediately before attaining the age of sixty years, then, he shall be
eligible to get such benefits.

• Section 108: Building and Other

CHACOConstruction
P J , AIMS
 State Building Workers’ Welfare Board
• Under Section 7 (1) of Chapter II, every State Government shall,
with effect from such date as it may, by notification, appoint, constitute
a Board to be known as the................(name of the State) Building and
Other Construction Workers' Welfare Board.
• The Building Workers' Welfare Board shall consist of
▫ a Chairperson to be nominated by the State Government,
▫ one member to be nominated by the Central Government and
▫ such number of other members, not exceeding fifteen, as may be
appointed to it by the State Government: Provided that the Building Workers'
Welfare Board shall include an equal number of members representing
the State Government, the employers and the building workers and
that at least one member of the Board shall be a woman.
• The Building Workers' Welfare Board shall appoint a Secretary and such
officers and employees as it considers necessary for the efficient
discharge of its functions of the Building Workers' Welfare Board under
this Code.
• The Secretary of the Building Workers' Welfare Board shall be its chief
executive officer. CHACO P J , AIMS
 State Building Workers’ Welfare Board
• Functions
▫ provide death and disability benefits to a beneficiary or
his
dependents;
▫ make payment of pension to the beneficiaries who have completed
the age of sixty years;
▫ pay such amount in connection with premium for Group Insurance
Scheme of the beneficiaries as may be prescribed by the appropriate
Government;
▫ frame educational schemes for the benefit of children of the
beneficiaries as may be prescribed by the appropriate Government;
▫ meet such medical expenses for treatment of major ailments of a
beneficiary or, such dependent, as may be prescribed by the
appropriate Government;
▫ make payment of maternity benefit to the beneficiaries;
▫ frame skill development and awareness schemes for the beneficiaries;
▫ provide transit accommodation orPhostel
CHACO J , AIMSfacility to the beneficiaries;
CHAPTER IX
SOCIAL SECURITY FOR UNORGANISED WORKERS
• The code subsumes the Unorganised Workers Social Security Act,
2008
• However even after 12 years of the enactment of the act, only 6% of the
unorganized workers are covered under one or other form of social
security. The experience interalia shows that application of UWSSA 2008 over
more than a decade clearly demonstrates that it did not provide an adequate
framework for extending entitlements to social security for unorganized workers.
• The major issues associated with UWSSA, 2008 are: (a) no empowered
implementing body; (b) boards are advisory and not established in several states;
(c) funding for boards functions has been lacking, as well as for record-keeping
and administration of the Act; (d) no new schemes notified, except for 10 schemes
already in operation listed in Schedule 1 which are deemed to be schemes for
unorganised workers; (e) several of these listed contributory and non-contributory
social assistance schemes lack a legislative basis and meant for both workers and
non-workers; (f) lack of mobility and portability; (f) no administration machinery
for inspection and no penalties.

CHACO P J , AIMS
CHAPTER IX
SOCIAL SECURITY FOR UNORGANISED WORKERS
• "unorganised sector" means an enterprise owned by individuals or
self-employed workers and engaged in the production or sale of goods or
providing service of any kind whatsoever, and where the enterprise
employs workers, the number of such workers is less than ten.
• ‘‘unorganised worker" means a home-based worker, self-employed
worker or a wage worker in the unorganised sector and includes a
worker in the organised sector who is not covered by the Industrial
Disputes Act, 1947 or Chapters III to VII of this Code.
• "wage worker" means a person employed for remuneration in the
unorganised sector, directly by an employer or through any contractor,
irrespective of place of work, whether exclusively for one employer or for
one or more employers, whether in cash or in kind, whether as a home-
based worker, or as a temporary or casual worker, or as a migrant
worker, or workers employed by households including domestic
workers, with a monthly wage of an amount as may be notified by the
Central Government and State Government, as the case may be
CHACO P J , AIMS
CHAPTER IX
SOCIAL SECURITY FOR UNORGANISED WORKERS
• Section 109-114
• Section 109: Framing of scheme for unorganised workers, and constitution of social
security fund for gig workers, platform workers, etc.
• The Central Government shall formulate and notify, from time to time, suitable
welfare schemes for unorganised workers on matters relating to (i) life and disability
cover; (ii) health and maternity benefits; (iii) old age protection; (iv) education; (v)
housing.
Funding
• (i) wholly funded by the Central Government; or
• (ii) partly funded by the Central Government and partly funded by the State
Government; or
• (iii) partly funded by the Central Government, partly funded by the State Government
and partly funded through contributions collected from the beneficiaries of the scheme
or the employers as may be specified in the scheme by the Central Government; or
• (iv) funded from any source including corporate social responsibility fund
within the meaning of Companies Act, 2013 or any other such source.
• The Central Government may, by notification, constitute a Social Security Fund or
funds for provision of social security to the unorganised workers, platform workers or
gig workers or any class of such workers comprising of the funding received.
CHAPTER IX
SOCIAL SECURITY FOR UNORGANISED WORKERS
The State Government shall formulate and notify, from time to time,
suitable welfare schemes for unorganised workers, including schemes
relating to— (i) provident fund; (ii) employment injury benefit;
(iii) housing; (iv) educational schemes for children; (v) skill
upgradation of workers; (vi) funeral assistance; and (vii) old age
homes.
Section 110:
• Funding:
• (a) wholly funded by the State Government; or (b) partly funded by the
State Government, partly funded through contributions collected from
the beneficiaries of the scheme or the employers as may be specified in
the scheme by the State Government; or (c) funded from any source
including corporate social responsibility fund referred to in
clause (iv) of sub-section (3) of section 109
• The State Government may seek financial assistance from the Central
Government for the schemes formulated by it.
CHACO P J , AIMS
CHAPTER IX
SOCIAL SECURITY FOR UNORGANISED WORKERS
• Section 111: Record Keeping
• Section 112: Workers facilitation centres
• The Central Government or the State Government may setup
such
Workers Facilitation Centres.
• Functions:
• (a) disseminate information on available social security schemes for the
unorganised workers; (b) facilitate filling, processing and forwarding of
application forms for registration of unorganised workers; (c) assist
unorganised worker to obtain registration from the authority specified in
the scheme; and (d) facilitate the enrolment of the registered
unorganised workers in social security schemes.
• Section 113: Registration of unorganised worker
▫ Every unorganised worker shall be eligible for registration, provided (a) he has
completed sixteen years of age or such age as may be prescribed by the
Central Government; (b) he has submitted a self-declaration electronically or
otherwise in such form, in such manner and to such authority containing such
CHAPTER IX
SOCIAL SECURITY FOR UNORGANISED WORKERS
• "gig worker" means a person who performs work or participates in a
work and earns from such activities outside of
traditional
arrangement employer-employee relationship (eg. freelancers,
independent contractors, project-based workers and temporary or part-
time hires)
• "platform work" means a form of employment in which organisations
or individuals use an online platform to access other organisations or
individuals to solve specific problems or to provide specific services in
exchange for payment;
• "platform worker" means a person engaged in or undertaking
platform work;

• Section 114: Schemes for gig workers and platform workers

▫ (a) life and disability cover;
▫ (b) health and maternity benefits;
▫ (c) old age protection; and
▫ (d) any other benefit as may be determined
by the CHACO PGovernment.
Central J , AIMS
 National Social Security Board
• Under Clause 6 of Chapter II, The Central Government shall, by
notification, constitute a National Social Security Board for
unorganised workers with:
▫ Union Minister for Labour and Employment as Chairperson;
▫ Secretary, Ministry of Labour and Employment as Vice-
Chairperson;
▫ Director General Labour Welfare—Member Secretary, ex officio;
▫ thirty-five members to be nominated by the Central Government
• The term of the National Social Security Board shall be three years.
• Functions:
▫ recommend to the Central Government suitable schemes for
different sections of unorganised workers;
▫ monitor such social welfare schemes for unorganised
workers
as are administered by the Central Government;
▫ review the record keeping functions performed
at the State level;
 State Unorganised Workers' Board
• Under Section 6 (9) of Chapter II, every State Government shall, by
notification, constitute a State Board to be known as (name of the State)
Unorganised Workers' Social Security Board or State Unorganised
Workers' Board with:
▫ Minister of Labour and Employment of the concerned State as
Chairperson, ex officio; Principal Secretary or Secretary (Labour) as
Vice-Chairperson; Member Secretary as notified by the State
Government
▫ twenty-eight members to be nominated by the State Government
• Functions:
▫ recommend the State Government in formulating suitable schemes for
different sections of the unorganised sector workers;
▫ monitor such social welfare schemes for unorganised workers as are
administered by the State Government;
▫ review the record keeping functions performed at the district level;
▫ review the progress of registration and issue of cards to
unorganised sector workers;
▫ review the expenditure from the funds under various schemes.
CHAPTER XII
OFFENCES AND PENALTIES
• Section 135-140
• Section 135: Penalty for failure to
pay contributions, etc.
• Section 136: Enhanced punishment in
certain cases after previous conviction
• Section 137: Offences by companies
• Section 138: Cognizance of offences
• Section 139: Prior opportunity before prosecution
• Section 140: Compounding of offences
• Regarding penalties, No court inferior to that of a
Metropolitan Magistrate or a Judicial Magistrate of the first
class shall try any offence punishable under the Chapter XII
of the SS code. CHACO P J , AIMS
 CHAPTER XII
OFFENCES AND PENALTIES
• Penal provisions
• The code intends to provide penalties, and the severity of the same
will be based on the nature of the offence. For e.g. failure to pay
employees' contributions attracts a fine of Rs 50,000 (in the first instance) and
a prison term that could extend to six months.
• However, if the contributions have been deducted from employees'
wages and not remitted, this is viewed more seriously. Here the fine is
double the amount (Rs 100,000) coupled with minimum imprisonment period
of one year and could range up to three years.
• The messaging clearly seems to be that the benefit to employees should
not be compromised and acts as a deterrent to the employer from
any non-compliance.
• The Code on Social Security is clearly a move in the right direction to
rationalise and consolidate social security related labour laws.
• It is critical for employers to analyse the impact of the Code and the
compliances thereunder in order to be able to undertake a smooth
transition as and when the Code becomes a law.
CHACO P J , AIMS
 Highlights of Social Security Code
• The Code has widened coverage by including
the
unorganised home based
sector,
employed workers, workers, self- fixed term
workers, platform workers,
employees, inter-state
gig migrant
workers etc., in addition to contract employees.

• Aggregators, meaning “digital intermediaries or a

market place for a buyers or users of a service to
connect with the seller or the service provider”, are
specifically required to contribute to the social
security fund.
CHACO P J , AIMS
 Highlights of Social Security Code
• The code for the first time recognises the need to provide social security
benefits such as including life insurance and disability insurance, health
and maternity benefits, provident fund and skill upgradation to workers in
the unorganised sectors who form a significant part of the workforce but
are not covered by any of the existing welfare schemes.
• Under the code, while the definition of wages is broadly similar to the EPF
Act, a new concept of deemed wages has been introduced.
▫ It means that if an employee receives more than 50% of the total
remuneration in the form of allowances and other amounts that are not
included within the definition of wages, then the excess amount would
be deemed to be wages for the purposes of contributions towards EPF.
• The SS Code has fixed different thresholds with respect to eligibility for
gratuity of permanent and fixed term employees. However, a continuous
service of five (5) years shall not be necessary where the termination of
the employment of any employee is due to death or disablement or
expiration of fixed term employment. Gratuity under the SS Code is
payable to employees hired directly or through a contractor.
CHACO P J , AIMS
 Highlights of Social Security Code
• Uniform definitions
▫ Uniformity in determining wages for the purpose of
social security benefits.
• Consultative approach
▫ the Code provides for an enhanced role of inspector-
cum-facilitator whereby employers can look for
support and advice to enhance compliances.
• Career Centre
▫ Setting up of career centres to replace the existing
employment exchanges.
▫ To enable that demand for human resources is met and to
monitor employment information employers have to report
vacancies to career centres before filling up the same.
CHACO P J , AIMS
 Highlights of Social Security Code
• Digitisation
▫ All records and returns have to be maintained electronically.
Digitisation of data will help in exchange of information among
various stakeholders/funds set up by the Government, will
ensure compliance and also facilitate governance.

• Stringent penalties
▫ Any failure to deposit employees’ contributions not only attracts
a penalty of Rs. 1,00,000, but also imprisonment of one to
three years. In case of repeat offence, the penalties and
prosecution is severe, and no compounding is permitted for
repeated offences.

CHACO P J , AIMS
 Highlights of Social Security Code
 In the event of the death of a worker or injury to a worker due to an
accident at his workplace, atleast 50 % share of the penalty would be
given. This amount would be in addition to Employees Compensation.
 Provision of “Social Security Fund” for 40 Crore unorganized workers
along with gig and platform workers and will help Universal Social
Security coverage.
 The facility of ESIC would now be provided in all 740 districts. At
present, this facility is being given in 566 districts only.
 EPFO’s coverage would be applicable on all establishments having 20
or more workers. At present, it was applicable only on establishments
included in the Schedule.
 With the aim of making a national database for unorganised sector workers,
registration of all these workers would be done on an online portal and this
registration would be done on the basis of Self Certification through a simple
procedure.
Labour Reforms under Atmanirbhar Bharat Abhiyan
 Universalization of right of minimum
statutory concept of National
wages (a Floor Wage to be
introduced) and timely payment of wages to all
workers including unorganized workers –
presently minimum wages applicable to only of
30%
workers.
Appointment letter to be provided to all workers to
promote formalisation.
Occupational Safety & Health (OSH) code will also be
applicable to establishments engaged in work of
hazardous nature even with a threshold of less
than 10 workers.
Definition of the inter-state migrant worker to
include migrant workers employed directly by the
employer. CHACO P J , AIMS
Labour Reforms under Atmanirbhar Bharat Abhiyan
Extension of ESIC coverage, on a voluntary
basis, will be extended to all districts and all
establishments employing 10 or more employees as
against those in notified districts/areas only.

Mandatory ESIC coverage for employees in

hazardous industries with less than 10 employees.

Centre to introduce re-skilling fund introduced

for retrenched employees and provision for Social
Security Fund for unorganised workers.

CHACO P J , AIMS