Question

Do you know of ways that employers can meet their employment needs and, at the same time, avoid the high costs of providing medical benefits to employees? If so, discuss the benefits and problems for both the employer and employee.  

Answer 1

Employer can meet his employment needs and at the same time avoid high medical cost in following ways :

1. He can comply with the provision of ESI Act and this will help him complying with statutory obligation and he will be liable for amount upto a certain limit as recommeded in act

2 payment to employee compensation is tax deductible

3. Employer can have his employment needs on contract basis . in this type of labour, responisiblity of medical benefit to employee is on contractor.

Benefit for empolyee :

1 If employee get registered under ESi Act , then he will be reimbursed on basis of that policy on basis of bill submitted by him

Problem for employer :

1 In ESI Act, there is equal amount of contribution of money by employer and employee but in some case, employee does not want his share to be deducted, this could cause problem for an employer.