TIRUNELVELI: The sub-regional office of Employees’ State Insurance Corporation (ESIC) on Wednesday froze the bank account of Raam & Co, which supplies manpower to Tirunelveli corporation, and confiscated Rs 72 lakh towards penalty after the agency was allegedly found to have swindled the ESI contribution of 887 sanitation workers.
The ESIC action comes after Raam & Co failed to respond to its show-cause notice and pay Rs 72 lakh penalty.
“Till the process to unfreeze the bank account is completed, Raam & Co cannot use it for any transaction,” said sources.
B Radha Sankar, an activist, and a few sanitation workers submitted several petitions stating Raam & Co deducted ESI contribution from workers for nearly 20 months but did not remit it to ESIC.
When contacted, Tirunelveli Corporation Commissioner Monika Rana said, “We received a notice from the ESIC and instructed Raam & Co to fulfil the requirements. We also served a separate notice to the agency.”
K Senthil, an administrator of Raam & Co, said they were taking steps to enrol sanitation workers with the ESIC.
“We have practical difficulties in registering workers who are aged above 50. We faced data mismatch errors while submitting their documents. We have already paid ESI contributions for a portion of the workers,” he added.
Sanitation workers refuted his claim and said staff in the Tirunelveli ESI Hospital always told them to go to Tirunelveli Medical College Hospital because our names were not registered.
I Vivek deputy director (Recovery), Sub-Regional Office, ESIC, said the bank account of Tirunelveli corporation was also frozen until the Rs 72 lakh fine amount was recovered.
On September 2, 2023, the Tamil Nadu government extended the provisions of Employees’ State Insurance Act, 1948, to contractual employees of all local bodies.
Raam & Co allegedly violated this and did not remit to ESI contribution collected from sanitation workers.
Sources said manpower agencies in several corporations across Tamil Nadu allegedly do not enrol workers in ESIC and swindle their contributions.