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Who all can be Nominee & Dependent under various Labour Laws

Posted by: on 27 December 2018 in HR, Payroll, Talent Management

This post is part of the Coffee Break Guide to Compliance by Anandan Subramaniam. Please subscribe to the blog updates if you’d like to be notified of these posts. Please comment below with your doubts and queries.

The Coffee Break Guide to Compliance – Vol. 24 {Who all can be Nominee & Dependent under various Labour Laws}

Every employee who works for a compensation, does also saves money in form of Provident Fund, get cover under EDLI of PF, coverage under ESI if eligible and be eligible for Gratuity for his later life. 

In case of sudden demise of the employee, his/her family cannot be put into financial adversaries.  Every applicable labour law (mainly Social Security legislations) is designed in such a way that the employee can nominate his family or others, while in service, for his/her nominees to get the financial benefits.

Following discusses the nomination facilities available for employees across various labour laws.

Nomination under The Payment of Gratuity Act

Every employee who has completed one year of service is required to make a nomination. There can be more than one nominee (which should be in Form F). Nominees may be changed at any time by the employee, by giving a written notice to the employer (in Form H). If no nomination has been made, it shall be paid to the legal heirs of the deceased employee or if the heirs are minor, the share of such minor shall be deposited by the controlling authority with a bank till he attains majority.  The meaning of Family under the Act is – Spouse, children, dependent parents and any adopted child.

Nomination under The Maternity Benefit Act

Provided that where the insured woman dies during her delivery or during the period immediately following the date of her delivery for which she is entitled to maternity benefits, leaving behind in either case, the child maternity benefits shall be paid for the whole of that period but if the child also dies during the said period, then for the days upto and including the day of the death of the child, to the person nominated by the insured woman (in Form E), in such manner as may be specified in the regulations, and if there is no such nominee, to her legal representative.

Nomination under The Payment of Wages Act

Every employed person shall make a declaration in Form-I, nominating a person conferring the right to receive the amount that may stand in his credit at the event of his death. If an employed person has a family at the time of making nomination, the nomination shall be in favour of the spouse or the spouse in preference followed by one more members of his family. Family means all or any of the following relatives of an employed person, namely :- (i) a spouse; (ii) a minor child dependent upon the employed person; (iii) a child who is wholly dependent on the earnings of the employed person and who is receiving education, till he or she attains the age of twenty-one years; (iv) an unmarried daughter; (v) a son or daughter who is inform by reason of any physical or mental abnormality or injury and is wholly dependent on the earnings of the employed person, so long as the infirmity continues;

 

Nomination under The Payment of Bonus Act

Where any money is due to an employee by way of bonus from his employer under a settlement or an award or agreement, in the case of the death of the employee, his assignee or heirs are eligible to receive such monies.

Nomination under the EPF & EDLI Scheme: The subscriber (Employee) needs to nominate his/her family while joining the establishment as member of Provident Fund and Pension. The subscriber can change his/her nomination whenever he/she wants to do so.  The nomination should be in favour of one or more member(s) of the family. If the member has no family, he or she can nominate anyone. There can be more than one family member as nominees with a defined percentage of the amount to be received by each. A family is defined in the Employee’s Provident Fund Scheme as:

In the case of Male Employees, the nomination can be filled for, (a) Wife, (b) Children, (c) Dependent parents and (d) Widow of son and children

In the case of Female Employees, the nomination can be filled for, (a) Husband, (b) Children, (c) Dependent parents, (d) Husband’s dependent parents, (e) Spouse’s dependent parents and (f) Widow of son and children

Nomination under Employee Pension Scheme: If the employee has family members, he cannot nominate anybody out of the family. Once an unmarried member marries, he will have to file a fresh nomination again.

A family is defined as, (a) Spouse of the employee, (b) Minor son and unmarried daughter of an employee and (c) Adopted son or daughter who was adopted before the death of an employee

For both EPF (which includes for EDLI) and EPS the nomination is to be done through online, in Form 2.

Nomination under Employee State Insurance Scheme (in Form 1)

ESI, Maternity Benefit : where the insured woman dies during her delivery or during the period immediately following the date of her delivery for which she is entitled to maternity benefits, leaving behind in either case, the child maternity benefits shall be paid for the whole of that period but if the child also dies during the said period, then for the days upto and including the day of the death of the child, to the person nominated by the insured woman, in such manner as may be specified in the regulations, and if there is no such nominee, to her legal representative.

ESI, Dependent’s benefit due to Employment injury:

In the case of death of the insured person, the dependents’ benefits shall be payable to his widow, children and widowed mother as follows :- (a) to the widow during life until re-marriage, an amount equivalent to three-fifths of the full rate and, if there are two or more widows, the amount payable to the widow as aforesaid shall be divided equally between the widows, (b) to each legitimate or adopted son, an amount equivalent to two-fifths of the full rate until he attains the age of eighteen years:

Provided that in the case of a [legitimate or adopted son] who is infirm and who is wholly dependent on the earnings of the insured person at the time of his death, dependents’ benefits shall continue to be paid while the infirmity lasts, (c) to each legitimate or adopted unmarried daughter an amount equivalent to two-fifths of the full rate until she attains the age of eighteen years or until marriage, whichever is earlier.

 

Dependent under Employee Compensation Act

A dependent of a deceased workman may apply to the Commissioner for the issue of an order to deposit compensation in respect of the death of the workman.  Dependent means any of the following relatives of a deceased workman, namely:- (i) a widow, a minor legitimate or adopted son, an unmarried legitimate or adopted daughter, or a widowed mother; and (ii) if wholly dependent on the earnings of the workman at the time of his death, a son or a daughter who has attained the age of 18 years and who is infirm; (iii) if wholly or in part dependent on the earnings of the workman at the time of his death, (a) a widower, (b) a parent other than a widowed mother, (c) a minor illegitimate son, an unmarried illegitimate daughter or a daughter legitimate or illegitimate or adopted][if married and a minor or if widowed and a minor, (d) a minor brother or an unmarried sister or a widowed sister if a minor, (e) a widowed daughter-in-law, (f) a minor child of a pre-deceased son, (g) a minor child of a pre-deceased daughter where no parent of the child is alive, or (h) a paternal grandparent if no parent of the workman is alive.


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