ESIC Vests Dues Assessment Powers in Group A Officers to Reduce Compliance Costs, Curb Arbitrary Orders

New Delhi, Dec 17 (KNN) In a move aimed at reducing compliance cost for industry and making rules more business-friendly, Employees’ State Insurance Corporation (ESIC) has vested the power of assessment and determination of dues from employers in officers not below the rank of Group A.

The move is in line with the new rules notified under Code on Social Security (CoSS), 2020.

In a communication to all its regional and sub-regional offices, the ESIC said that following implementation of the Code on Social Security, 2020 "all the assessment and determination of due, including pending if any, is to be done strictly as per the provisions u/s 125 of the CoSS, 2025, by officer in the cadre of Deputy Director and above."

Following a gazette notification, the Code on Social Security, 2020 has been made effective from November 21, 2025.

"As per Section 125 of the CoSS, 2020, officer not below the rank of Group 'A' officer is authorized to do the assessment and determination of dues from the employer," said Rakesh Roshan, Deputy Director, ESIC in the communication.

The Employees’ State Insurance Corporation or ESIC under the aegis of Ministry of Labour and Employment administers the Employees’ State Insurance Act 1948 which provides for medical, cash, maternity, disability and dependent benefits to the insured persons under the law.

Commenting on the ESIC directive, Neeraj Dubey, Managing Partner, Valid PointsZ said that the idea behind assigning the assessment power to Group A officers is to improve administrative quality and efficiency.

"It will promise a reduced scope for arbitrary or erroneous assessments and, therefore, less vulnerable to be challenged when they are appealed in the higher courts on grounds of incompetence of the Officer and Jurisdiction validity of the order," he said.

Elaborating further, Mr Dubey said that the enquiries under the Code on Social Security are quasi-judicial in nature and the powers are equivalent to a civil court.

"Another key aspect is that there used to be no time-limit to adjudicate these inquiries. Now, there is a clear 5 year period to initiate the proceeding; 2 years to complete the inquiry and maximum 1 year extension with recorded reason," he said.

Mr Dubey noted, "With senior Group 'A' officers conducting assessments, there would be better quality control in determination of dues, more consistent application of legal principles across assessments, reduced likelihood of errors due to inexperience or inadequate understanding and greater accountability as senior officers are subject to higher standards of conduct and scrutiny."

The industry has welcomed the implementation of new labour laws and most of the rules notified under it.

"The ESIC directive is a welcome move. It will have a positive outcome," said Arun Kumar Garodia, Managing Director of Corona Steel Industry Pvt Ltd and former Chairman of apex engineering exports promotion body EEPC India.

The central government last month made the four Labour Codes - the Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020 and the Occupational Safety, Health and Working Conditions Code, 2020 effective. The four Codes have rationalised 29 existing labour laws and aligned India’s labour ecosystem with global standards.

(KNN Bureau)