ESIC Scheme Not Meant For ‘Ease of Doing Business’ by Defaulting Employers: CITU

New Delhi: The Centre of Indian Trade Unions (CITU) has condemned the Central government’s move compromise workers’ rights under the Employees State Insurance Corp. (ESIC) scheme by re-launching SPREE (for registration of workers), announcing an amnesty scheme and “decriminalising and bailing out” defaulting employer groups in the name of “ease of doing business”.

In a press statement, CITU general secretary Tapan Sen termed the Labour Ministry’s move as a “deceptive ploy to foster non‑compliance with statutory obligations,” adding that this decision represents an “unscrupulous attempt to push through provisions of the Social Security Code and the four Labour Codes”

“Although these schemes are loudly announced in the guise of expanding coverage, the pressing issue of extending coverage beyond the current eligibility wage limit of ₹21,000—repeatedly raised by CITU and other Central Trade Unions—has still not been resolved by the Government. This delay excludes a huge number of workers every day, even in PSUs, from the ambit of ESIC,” he said.

CITU urged the ESIC to rescind the announced schemes and enforce statutory compliance by employers through strict penal actions for non‑compliance, as prescribed in the Act.

Sen also called upon the working people to resist these “nefarious plans” by ensuring the success of the July 9, 2025 general strike call by Central trade unions.

Read the full statement below:

ESIC IS NOT FOR “EASE OF DOING BUSINESS” BUT TO DEVELOP A “FOOL‑PROOF MULTI‑DIMENSIONAL SOCIAL SECURITY SYSTEM.”

Centre of Indian Trade Unions (CITU) denounces the re-launching of SPREE Scheme, introduction of Amnesty Scheme 2025 and reduction of damages payable by the employer as schemes decriminalising the offences under Employees State Insurance Act 1948 and curbing the legitimate rights of employees to be insured under the ESI Scheme.

The Employees’ State Insurance Corporation (ESIC), at its 196th meeting in Shimla, Himachal Pradesh, deliberately announced these decisions and schemes focused “on promoting ease of doing business,” though the ESI Act was promulgated in 1948 for the “creation and development of a fool‑proof multi‑dimensional Social Security system.” This blatant shift in the Central Government’s approach is evident in its attempt to tamper with the Parliament‑enacted ESI Act and its statutory provisions. These schemes are being framed surreptitiously while the Social Security Code, 2020—containing similar clauses for compounding employers’ offences—remains unimplemented. CITU therefore urges ESIC to rescind the announced schemes and enforce statutory compliance by employers through strict penal actions for non‑compliance, as prescribed in the Act.

Although these schemes are loudly announced in the guise of expanding coverage, the pressing issue of extending coverage beyond the current eligibility wage limit of ₹21,000—repeatedly raised by CITU and other Central Trade Unions—has still not been resolved by the Government. This delay excludes a huge number of workers every day, even in PSUs, from the ambit of ESIC.

The Press Statement released by PIB on 27 June 2025 announced the re‑launch of the Scheme to Promote Registration of Employers/Employees (SPREE), a scheme that effectively absolves employers’ offences of non‑compliance with the ESI Act. In the name of promoting voluntary compliance, it does away with penalisation and eases the litigation burden—squarely to the benefit of employers. The scheme allows unregistered employers to register voluntarily from a date declared by them, without any liability to pay the dues accruing from the commencement of the establishment, as required by the ESI Act. The Government must disclose the amount of contribution, interest, and penalties forgone by ESIC under the first phase of the same scheme in 2016.

Under this re‑launched SPREE, the Government offers a “one‑time opportunity for unregistered employers and left‑out workers—including contractual and temporary staff.” CITU asserts that inclusion in the ESI Scheme should neither be a “one‑time opportunity” for left‑out workers nor a special offer for “contractual and temporary staff.” The Act does not tie eligibility to the permanency of employment; it is the duty of employers and the Government to ensure workers’ rights. Immediate action is therefore necessary to bring all eligible establishments and workers under the ESI Scheme instead of relying on “voluntary compliance.”

Along with SPREE, ESIC has approved the Amnesty Scheme – 2025, a one‑time dispute‑resolution window from 1 October 2025 to 30 September 2026—again a decriminalisation package for employers. Regional Directors are now empowered to withdraw cases without damages or interest for non‑compliance, thereby placing executive discretion above the legislative framework and reducing the scope for challenging defaulters.

The maximum rate of damages has been cut from 25 % per annum to 1 % per month on the amount payable by the employer. This effectively halves the maximum charge and is clearly designed to benefit wilfully defaulting employers. The ESI Act allows these dues to be recovered as arrears under the Land Revenue Act, yet these new schemes—mirroring the Union Government’s “Vivaad se Vishwas” and “Samasya se Samadhan” initiatives for corporate tax dues—let ESI violators go scot‑free, undermining workers’ interests.

The Corporation has also approved a pilot project to partner with “charitable hospitals,” which CITU fears will transfer ESIC funds to private hospital groups and derail efforts to build ESIC’s own dispensaries and hospitals in underserved areas, effectively outsourcing the Corporation’s statutory duty.

In short, the schemes announced at this meeting have a single purpose: to decriminalise and bail out employer groups that are wilful defaulters and responsible for the suffering—and even deaths—of millions of eligible employees. CITU demands strong legal action and full enforcement of workers’ rights, not lofty government offers.

Ease of doing business for employers is wholly incompatible with—and indeed contravenes—the basic objectives of the ESI Scheme. Accordingly, “SPREE” and the other schemes promoted by the Labour Ministry are deceptive ploys to foster non‑compliance with statutory obligations. They represent an unscrupulous attempt to push through provisions of the Social Security Code and the four Labour Codes. The working class must resist these nefarious plans by ensuring the massive success of the 9 July 2025 General Strike.

Issued by

TAPAN SEN

General Secretary, CITU.