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Who gets monetary benefits under each Legislation, in case of unfortunate demise of an employee?

Posted by: The ADP Team on 15 August 2019 in Compliance

Where an employee engaged in any Shops, Commercial Establishments, Manufacturing Establishments, Mines and any other establishments, if deceases, the benefits are received by his/her nominees or dependents.  Who shall be such nominees/dependents, under each employment, social security legislations are listed below:

Undisbursed wages

The Code on Wages, 2019 – Section 44 (1)

All amounts payable to an employee under this Code shall, if such amounts could not or cannot be paid on account of his death before payment or on account of his whereabouts not being known,—

  • Be paid to the person nominated by him in this behalf in accordance with the rules made under this Code; or
  • Where no such nomination has been made or where for any reasons such amounts cannot be paid to the person so nominated, be deposited with the such authority, as may be prescribed, who shall deal with the amounts so deposited in the manner as may be prescribed.  

All Amounts here means (i) undisbursed wages (ii) undisbursed statutory bonus.

ID Act Chapter VII Section 33(c)

Where any money is due to workman from an employer under a settlement or an award or under provisions of Chapter VA and Chapter VB, in case of death of the workman, his assignee or heirs may make an application to the appropriate government for recovery of the money.

Social security

  1. ESI Rules – Section 58 of ESI Rules
  • The Spouse – till life or remarriage
  • Son/adopted son, upto 25 years or his marriage whichever is earlier,
  • Daughter / adopted daughter, until her marriage,
  • Widowed mother
  • Infirm son/daughter till life and
  • If no family, dependent parents.
  • In case of female employee it is her parents.
  1. Payment of Gratuity Act – Section 6

Each employee who has completed 1 year service shall nominate in Form F.  If an employee has a family at the time nomination, it should be in favour of one or more member of his family.  Any nomination made by such employee in favour of a person who is not a member of his family shall be void.

If no family, the nomination may be made in favour of any person or persons but if the employee subsequently acquires a family, shall nomination shall forthwith become invalid and employee shall make fresh nomination in Form G.

  1. Employee Provident Fund under EPF & MP Scheme, Para 2(f)
  • In the case of a male member, his wife, his children;
  • In the case of a female member, her husband, her children.
  • If the member has got no family, or is a bachelor nomination may be a favour of any person or persons, whether related to him or not or even to an institution.
  • If the member subsequently acquires a family, such nomination shall forthwith become invalid and the member should make a fresh nomination in favour of one or more persons belonging to his family
  1. Employee Pension Scheme, Para 16
  • On the death of a member of the Family Pension Scheme, his family will be entitled to the benefits under the EPS; a family is
    1. Wife in the case of a male member
    2. Husband in the case of a female member
    3. Minor sons and unmarried daughters
  • If the member has got no family, the monthly family pension, on the death of the member, will not be paid. However, Life Assurance Benefit will be paid to the person or persons entitled to receive his provident fund accumulations
  1. Employee Deposit Life Insurance (EDLI) under EPF & MP Act, Section 23
  • The Nomination under the EPF scheme will be applicable for the EDLI scheme also. Nominees, except
    1. Sons who have attained majority
    2. Sons of a deceased son who have attained majority
    3. Married daughters whose husbands are alive
    4. Married daughters of a deceased son whose husbands are alive
  1. Factories Act Section 79(3)
  • If a worker dies while in service during the course of the calendar year, his heir or nominee as the case may be shall be entitled to wages in lieu of the quantum of leave to which he was entitled
  1. Maternity Benefit Act Section 6(1)
  • Any women employed in an establishment and entitled to maternity benefit may give notice in writing to her employer stating that her maternity benefit and any other amount to which she may be entitled under this Act may be paid to or such a person as she may nominate in the notice
  1. Subsistence Allowance Act Section 4
  • In case of the death of the employee, his legal representative may without prejudice make an application
  1. Labour Welfare Fund
  • In case of the death of the employee, his Heirs, Legal representatives and Assigns
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TAGS: The Code on Wages The Coffee Break Guide to Compliance

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Raj C says

Thanks for the info. sharing.