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RECENT AMENDMENTS to "RAJIV GANDHI SHRAMIK KALYAN YOJANA" (Unemployment Allowance) (Instruction No. 9/2/2007 dated 3.12.2007)

Rajiv gandhi Shramik Kalyan Yojana has been reviewed and following amendments/changes have been made :
  1. Application for Unemployment Allowance submitted upto 12 months shall be considered by Regional Directors/Director and Joint Director (I/c), Sub-Regional Offices for payment of Unemployment Allowance in eligible cases.
  2. The cases in respect of insured Persons where the trade Union has gone to Court and Insured Person himself is not a party, may also be considered after taking an undertaking from the Insured Person that in case he/she will refund the unemployment allowance received by him/her, to ESI Corporation.
  3. The certificate of closure in form UA-2 may also be accepted from employer if he submits the return of contributions under Regulation 26(b) on permanent closure of the factory/establishment

The ESI Scheme has introduced a scheme of unemployment allowance to the IPs who have been rendered unemployed involuntarily due to closure of the factory / establishment , retirement or permanent invalidity arising out of non-employment injury w.e.f. .
Affected IPs and their families will also be entitled to medical care from ESI Dispensaries / hospitals during periods of unemployment allowance.

Conditions For Qualify


  1. On the date of declaration as “unemployed” the affected persons should be come within the meanings as “Insured Persons”.
  2. The insured persons should have contributed for 3 years w.e.f. 11/09/2009(10 contribution periods) prior to their unemployment.
  3. The insured persons who have become unemployed on or after 1-4-2005 alone will be eligible for claiming this benefit.
  4. Unemployment Allowance is not eligible, if similar benefit is made available to the affected insured persons under the provisions of any other Acts / Law / Scheme, in force.

The period of service of an I.P need not be continuous with one employer. The I.P. shall be entitled to this allowance irrespective of the fact whether part of his/her service as employee was rendered in the insurable employment with any other employer in the same or in any other region.


  1. The daily rate of unemployment allowance is computed to Standard Benefit Rate with reference to the Average Daily Wages arrived on the basis of last four contribution periods prior to the date of unemployment of the affected insured persons.
  2. The entitled insured persons under this Scheme can opt for cash payment either on monthly basis or on one-lumpsum basis at a maximum of 12 months or till re-employed whichever is earlier.
  3. This cash payment will not be combined with any other cash payment on Sickness Benefit or Temporary Disablement Benefit or Maternity Benefit, if entitled to the affected insured persons, under this Scheme. However, the insured persons can opt for any one of the aforesaid benefits including unemployment allowance according to their choice.
  4. The affected insured persons and their family members are entitled to medical care / treatment in ESI Hospital / ESI Dispensaries, if eligible for unemployment allowance under this Scheme.
  5. The cash payment under this Scheme can be claimed / paid to the affected insured persons at the Branch Office of the ESI Corporation where they have been attached prior to the date of unemployment. The prescribed form for the claim of unemployment allowance can be had from the Branch Offices and the claim made with necessary documents for the proof of unemployment.

DisAdmissible Circumstances

  • During lockout
  • Layoff / temporary closure of factory/establishment
  • Strike resorted to by the employers
  • Voluntary abandonment of employment/voluntary retirement/premature retirement
  • Less than five years contributory service
  • On attaining age of superannuation or 60 (sixty) years whichever is earlier
  • Convicted (i.e punished for false statement) under provisions of section 84 of ESI Act.
  • On being re-employed elsewhere during the period he/she is in receipt of unemployment allowance
  • Dismissal/termination under disciplinary action
  • On death of I.P

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