Section 7: Powers and Functions of Social Security Organisations

Overview

Section 7 of the Code on Social Security, 2020, doesn’t focus on a *specific* benefit like Provident Fund or ESI. Instead, it lays the groundwork for how all social security schemes – including Provident Fund, Employees’ State Insurance (ESI), gratuity, maternity benefits, and schemes for unorganised sector workers – will be administered and governed. It outlines the powers and functions of the organisations responsible for implementing these schemes, aiming for a more unified and efficient social security system in India.

Who is Covered?

• This section doesn’t directly define who is covered by specific schemes. Coverage depends on the individual schemes themselves (e.g., ESI covers employees earning below a certain wage ceiling in specified factories and establishments). The section focuses on the *organisations* administering those schemes, and their authority over all covered individuals.
• Eligibility conditions remain scheme-specific. For example, Provident Fund eligibility typically requires a minimum length of service and a certain wage level.

Benefits and Contributions

• The benefits received by employees are determined by the specific social security scheme they are covered under (e.g., pension under Provident Fund, medical benefits under ESI, maternity benefits).
• Contribution responsibilities (employer, employee, and government) are also scheme-specific. This section empowers the social security organisations to *enforce* these contributions, but doesn’t define the contribution rates themselves.

Procedure and Compliance

Section 7 empowers social security organisations to streamline procedures. Key aspects include:

• Digital Records: Maintaining all records digitally for efficient management and accessibility.
• Inspections: Conducting inspections of establishments to ensure compliance with social security laws.
• Prosecutions: Initiating legal proceedings against employers who fail to comply with contribution requirements or other legal obligations.
• Data Integration: Using technology to integrate social security data from various schemes, creating a comprehensive database of beneficiaries.
• Benefit Delivery: Ensuring timely and accurate delivery of benefits to eligible workers, including those in the unorganised, gig, and platform economies.

Registration, contribution payments, and claim processes will continue to be governed by the rules of the individual schemes, but the organisations will have enhanced powers to oversee and enforce these processes.

Practical Examples

• Example 1: Employee Eligibility – An employee working in a factory covered under the ESI Act becomes eligible for medical benefits after completing a qualifying period of service. The ESI Corporation, empowered by Section 7, ensures the factory is registered and contributing correctly to enable the employee to access these benefits.
• Example 2: Employer Non-Compliance – A company fails to deposit the Provident Fund contributions deducted from its employees’ salaries. The Provident Fund Organisation, under the authority granted by Section 7, conducts an inspection, issues a notice, and initiates prosecution proceedings against the company to recover the outstanding contributions and penalize the employer.

Disclaimer

This article is for basic understanding of social security law and should not be treated as legal advice. For specific legal guidance, please consult with a qualified legal professional.