The amnesty scheme applies to cases filed up to March 31, 2025
According to Ministry sources, ESIC has so far filed applications in 258 cases across various courts seeking permission to withdraw proceedings against employers and companies
Nearly 20,000 litigations involving about ₹1,700 crore are pending under the Employees’ State Insurance Corporation (ESIC), with the Labour and Employment Ministry seeking to resolve them through an amnesty scheme effective from October 1, 2025, to September 30, 2026.
Labour and Employment Secretary Vandana Gurnani reviewed the progress of the ESIC amnesty scheme at a meeting on December 17. The meeting was attended by senior officials of the Ministry and the Corporation, including the Director General. The objective is to boost compliance with social security norms and significantly reduce the large number of cases pending outside courts.
According to Ministry sources, ESIC has so far filed applications in 258 cases across various courts seeking permission to withdraw proceedings against employers and companies. Simultaneously, employers in 1,552 cases have submitted requests for withdrawal under the amnesty scheme.
The unrecoverable amount arises from cases falling into different categories, including disputes pending for over five years, where employers no longer have the required records. In such cases, settlement can be reached by paying a specified percentage of the assessed contribution. In other instances, the owners of factories that have shut down are untraceable, which has added to the complexities, the sources said.
The amnesty scheme applies to cases filed up to March 31, 2025. It covers all cases initiated by the Corporation for non-compliance with the provisions of the ESIC Act, as well as cases filed by employers challenging assessments made by the Corporation.
Violations of the ESI Act primarily include non-payment or delayed payment of contributions, deduction of contributions from wages without remittance to ESIC, failure to produce records, and submission of false statements. Such violations attract stringent penalties, including fines, interest, damages of up to 25 per cent, and imprisonment of up to two years or more in cases of willful default, as these are treated as breaches of trust.
Cases in which employers have disputed the coverage of their factories or establishments under the Act are also covered by the scheme.
The total liability imposed by the Corporation on non-compliant employers is generally more than twice the amount of the actual contribution due.
In disputes relating to assessment, employers may pay the actual contribution along with applicable interest based on their records, which must be presented to the concerned ESIC field office. Upon acceptance, the Corporation will withdraw the court case and no penalty will be levied, Ministry sources explained.
ESIC field offices have been empowered to withdraw cases under the amnesty scheme.
Published on December 20, 2025
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