Have you ever felt the pain of losing your job or fear of not knowing what will happen next? You no longer need to hurry to find a new job. In this post, we are explaining how unemployment allowances can be availed through the Rajiv Gandhi Shramik Kalyan Yojana (RGSKY), under the ESI Act.
#What is Rajiv Gandhi Shramik Kalyan Yojana?
Rajiv Gandhi Shramik Kalyan Yojana
The scheme provides an unemployment allowance under the ESI Scheme for employees who become involuntarily unemployed due to layoffs/factory closures etc. after meeting certain eligibility conditions. The "Rajiv Gandhi Shramik Kalyan Yojana" scheme came into force from 1 April 2005.
The scheme targets an increasing number of workers who are redundant in the new competitive environment. Under this scheme, eligible workers receive a daily rate of allowances and medical care for themselves and their families during periods of unemployment of up to two years.
#What is the eligibility for receiving an unemployment allowance under the “Rajiv Gandhi Shramik Kalyan Yojana”?
Eligibility for receiving unemployment allowance:
An ESI holder should be unemployed after April 2005.
To avail of this scheme, An ESIC holder will have to wait at least one month after losing the job.
Employee’s previous company is covered under the ESI Act and they must have paid at least 2 years for the contribution of ESI.
The employee must file a UA claim within 12 months of unemployment.
The UA is available up to a maximum of 24 months, up to the age of 60, over an employee's lifetime.
Employees cannot avail of any other cash benefits (other than Medicare).
Once ESIC holder start a new job, their UA will end, until they lose their job again.
#What are the benefits of the RGSKY for the ESIC holders?
Benefits of the RGSKY:
1- Unemployment allowance:
Employees UA is calculated on the average of his/her last 4 ESI contributions (let it be the UA wedge).
For the first 12 months, their UA is 50% of the UA wage, while for the last 12 months, it is 25%.
UA only applies if they reluctantly lose their job due to the closure of their workplace or permanent disability, etc.
An ESI holder can avail 24 months of UA in parts.
If an employee does not have a job for 3 months, they can get 2 months of their UA. If the employee got a job after 3 months, they still have 22 months left of the UAA.
The employee can avail of UA for a minimum of one month.
2- Medical care:
Under RGSKY, any person still receives all the medical benefits of the ESI Act during his UA term. For more information about the medical benefits of the ESI Act visit this link.
3- Vocational training:
If a person selects vocational training from a government institution during his UA term, he/she receives a 100% grant. The government also pays for transportation charges.
#What are the reasons for the disqualification from the job/employment?
Reasons for disqualification
Employees lose their jobs due to the strike.
They opt for voluntary retirement.
If an employee is 60 years or older.
An employee opts for premature retirement.
An employee loses his job due to a dispute or conviction.
If the employee gets a new job.
#Who can claim the unemployment allowance under ESIC?
The ESIC holder who has ESIC registration has the right to claim an unemployment allowance under ESIC through Rajiv Gandhi Shramik Kalyan Yojana.
#What is the procedure for ESIC holder for claiming the unemployment allowance under ESIC?
1. Procedure for claiming unemployment allowance
A claim for unemployment allowance must be submitted by an individual at any time three months before the date of unemployment to the appropriate branch office in Form (US-1) supported by documentary evidence (in Form UA-2) to prove his unemployment. This certificate is issued by the Inspector of Factories, Assistant / Deputy Commissioner, Labor, Workers Compensation Commissioner, or any other authority in this regard.
2. Mode of payment of unemployment allowance.
Allowance is payable only by account payee check
3. Payment in the event of the death of the recipient:
The amount of unemployment allowance is payable to his / her legal heir up to and including the date of death of the recipient.