ESIC rolls out one-time amnesty scheme to cut court backlog

The Employees’ State Insurance Corporation (ESIC) has unveiled detailed guidelines for its one-time amnesty scheme 2025, a dispute resolution mechanism aimed at clearing long-pending litigation, easing compliance under the ESI Act and boosting ease of doing business.

The scheme, approved at ESIC’s 196th meeting in Shimla under the chairmanship of Union Labour Minister Mansukh Mandaviya, will run from October 1, 2025, to September 30, 2026. It offers employers and insured persons an opportunity to settle cases outside court in a structured, transparent manner.

The move is expected to ease pressure on overburdened courts while allowing businesses to resolve contribution, damages and prosecution disputes without facing punitive penalties. Notably, no damages will be imposed if dues and interest are cleared, and even entities that availed past amnesty schemes will be eligible this time.

For contribution disputes, employers can rely on records from EPFO or Income Tax authorities where internal documents are unavailable. In such cases, at least 30 per cent of assessed dues must be paid along with interest. Damages disputes can be closed by paying 10 per cent of determined penalties, while old prosecution cases involving dues up to Rs 25,000 may be withdrawn.

Criminal cases against insured persons under Section 84 will also be withdrawn if excess benefits are refunded and compliance assured, except those involving forgery or conspiracy. Similarly, legacy cases of non-filing of returns and late declaration forms may be scrapped, reflecting the shift to digital filing.

Regional and sub-regional ESIC offices have been empowered to fast-track settlements, with field committees comprising legal and finance officers tasked with ensuring that cases are closed within six months of the application.

By removing procedural hurdles and offering relief in long-drawn disputes, ESIC hopes to strengthen trust among employers while reducing the legal load on the judiciary. Officials said the amnesty is designed not merely as a relief measure, but as a step towards building a “progressive and responsive” social security framework.