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Vyakti Kalyan Yojana - Shanmugam IAS academy in coimbatore
Vyakti Kalyan Yojana


What’s in news?

The Union government is planning to give unemployment benefits to a section of organised workers who may lose their jobs due to the coronavirus pandemic.

Key data’s:

  • This will be along the lines of measures taken by some countries such as the United States to combat the impact of the pandemic, also known as COVID-19, on the working population.
  • The government’s ‘Atal Beema Vyakti Kalyan Yojana’, which provides unemployment insurance to workers who have subscribed to the Employees’ State Insurance (ESI) scheme, will cover such workers during the pandemic.
  • The ESI is a self-financing health insurance scheme for formal sector workers in India managed by the Employees State Insurance Corporation (ESIC).
  • Under the scheme, which has been operational since July 2018, workers who become unemployed get compensation in the form of cash up to three months of unemployment. But this can be availed only once in a lifetime.
  • The labour and employment ministry is looking to extend the scheme and allow workers to avail of unemployment insurance if they are impacted by coronavirus.
  • Workers get cash to the tune of 25 per cent of the average salary that they were getting in the last two years of their job under this scheme.
  • However, an important condition for workers to get the unemployment benefit is that they should have been a subscriber of the ESIC for at least two years.
  • When the scheme was made effective in July 2018, around 1 million workers were eligible.
  • The coverage of the ESI scheme itself is limited. The scheme applies to all factories and establishments employing at least 10 workers. In India, around 98 per cent of establishments employed less than 10 workers, according to the Sixth Economic Census 2013-14.

International Labour Organization:

  • The International Labour Organization (ILO) has estimated that up to 25 million people might become unemployed worldwide due to the impact of COVID-19.
  • It projected a range with 5.3 million job losses on a ‘low scenario’ and 24.7 million on a ‘high scenario’. During the global financial crisis of 2008-09, an estimated 22 million people had lost their jobs, according to the ILO.
  • India’s import-dependent sectors such as automobiles and pharmaceuticals will also take a hit due to disruptions in global trade.

Other countries:

  • Paid reductions in working time/partial unemployment benefits, which compensate workers for hours not worked, are being expanded or simplified in France, Germany, Italy and the Netherlands
  • The Chinese government has directed employers to not terminate contract of migrant workers in case of illness or containment measures
  • Unemployment insurance benefits have been expanded in several countries, including the United States. In the Philippines, the Social Security Scheme is prepared to give unemployment benefits for up to 60,000 job losses
  • Countries like Italy and Japan are giving financial support and simpler procedures for allowing teleworking
  • Provisions for paid sick leave for self-employed in Ireland, Singapore and South Korea.

Links to note:

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