ESIC Launches One-Time Amnesty Scheme 2025 to Resolve 27,000 Court Cases

The Employees’ State Insurance Corporation (ESIC) has approved the Amnesty Scheme 2025, a landmark one-time initiative aimed at dispute resolution, litigation reduction, and improved compliance under the Employees’ State Insurance Act, 1948. The decision was taken during the 196th ESI Corporation Meeting, chaired by Dr. Mansukh Mandaviya, Union Minister for Labour & Employment and Youth Affairs & Sports, in Shimla, Himachal Pradesh.

The scheme will be implemented from 1 October 2025 to 30 September 2026, offering employers a structured opportunity to settle long-pending disputes with ESIC outside courts, thereby easing compliance burdens and strengthening social security mechanisms.

The Litigation Backlog

As of 31 March 2025, nearly 27,000 cases were pending in various courts across the country related to ESIC dues, compliance lapses, and procedural disputes. Many of these cases have been delayed due to limited appeal provisions, absence of withdrawal powers, and prolonged litigation despite employers having complied at a later stage.

The Amnesty Scheme seeks to address these systemic gaps by offering a practical, time-bound, and employer-friendly resolution mechanism.

Key Features of the Scheme

1. Settlement of Ad-Hoc Assessments: Employers can resolve ad-hoc assessments by paying actual contributions and interest. Importantly, no damages will be levied under this category.

2. Withdrawal of Cases Where Dues Are Paid: In cases where employers have already cleared their dues, disputes can be closed by paying only 10% of the disputed damages.

3. Cases of Non-Submission or Delay: Court cases filed by ESIC for non-submission of records or delayed payments, which were subsequently complied with, will also be withdrawn—subject to court permission.

4. Eligibility:

   • Cases filed up to 31 March 2025 will qualify under this scheme.

   • Regional Directors and Sub-Regional Officers have been empowered to process withdrawals, ensuring decentralization and speedy action.

Empowering Regional Offices

Unlike earlier frameworks where withdrawal powers were limited, Amnesty 2025 empowers regional and sub-regional authorities to process dispute withdrawals directly. This decentralization will help reduce delays, cut down unnecessary litigation, and provide employers with a clear pathway to compliance.

Ease of Doing Business and Social Security

By simplifying compliance and providing a dispute resolution mechanism, the Amnesty Scheme is expected to:

• Substantially reduce the legal burden on employers and courts.

• Encourage voluntary compliance with ESI norms.

• Enhance the ease of doing business, particularly for MSMEs and enterprises struggling with procedural disputes.

• Reinforce ESIC’s role as a progressive, responsive, and business-friendly institution.

Dr. Mansukh Mandaviya, in his remarks, emphasized that the scheme reflects the government’s commitment to social security reform and to creating an environment of trust and collaboration between employers and the state.

Broader Implications

The Amnesty Scheme 2025 is not just a litigation settlement plan but also a strategic move towards inclusive growth. By clearing long-pending disputes, ESIC aims to:

• Free up resources for productive use by businesses.

• Ensure that contributions collected are channelled effectively into the social security net for workers.

• Provide a win–win framework where both employers and employees benefit from improved compliance and reduced litigation.

The ESIC Amnesty Scheme 2025 marks a turning point in India’s labour and social security governance, offering businesses a practical route to resolve disputes while reinforcing ESIC’s mission of protecting workers. By reducing litigation, promoting compliance, and fostering trust, the initiative strengthens the broader national agenda of ease of doing business and inclusive social security.