Applicability Of The Employees’ State Insurance Act, 1948 (The “ESI Act”)

The Supreme Court[1] has held that in light of the amendment of the applicability provision of the ESI Act with effect from 20.10.1989, a factory or establishment to which ESI Act applies would be governed by the ESI Act notwithstanding that the number of persons employed therein at any time falls below the limit specified by or under the ESI Act.

The Supreme Court observed that the said requirement is applicable even to those establishments, established prior to 20.10.1989; and the Employees’ State Insurance Act being a social welfare legislation, any interpretation which would lean in favour of the beneficiary should be given.

[1] The ESI Corporation Vs. M/s. Radhika Theatre; CIVIL APPEAL NO. 312 OF 2023 (@ SLP(C) NO. 12520 OF 2022)