This article has been written by Aditi Sahu pursuing the Diploma in Business Laws for In-House Counsels from LawSikho. This article has been edited by Aatima Bhatia (Associate, Lawsikho) and Smriti Katiyar (Associate, Lawsikho). 


ABVKY (Atal Beemit Vyakti Kalyan Yojana) scheme is a welfare measure for employees, it was introduced on July 1, 2018. Unemployment benefits are paid to employees insured by the Employees’ State Insurance (ESI) scheme under it. This welfare measure for employees is covered by Section 2(9) of the ESI Act, 1948, in the form of a once-in-a-lifetime relief payment of up to 90 days and can be claimed after three months (90 days) of unemployment in one or more periods.

The Scheme was implemented on a trial basis beginning on July 1, 2018, for two years. From July 1, 2020, until June 30, 2021, the program has been extended for another year. It has also been decided to increase the rate of unemployment relief under the scheme from 25% to 50% of wages, as well as relax eligibility requirements, provided that the Insured Person has been in insurable employment for at least two years immediately preceding her/his unemployment and has contributed for at least 78 days in the contrived period.

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What is ESI Act,1948?

Under the Employees’ State Insurance Act, 1948 those workers and employees include those who work in factories, business facilities, and organizations like hotels, road transportation, theatres, newspapers, educational or medical institutions, and stores, where 10 or more people are engaged and working.  

In the event of an unpleasant event at work, the ESI system provides benefits to both workers and their dependents. Employees or workers in the above-mentioned groups who earn up to Rs. 21,000 per month and a person who is capped with a disability earning not more than Rs. 25,000 are eligible for this social security scheme under the ESI Act. During times of crisis, the ESI Act aims to defend people’s dignity by shielding them from destitution and deprivation.

There are two contribution periods of six months each in a fiscal year. Also, the ESI Act contribution rate was reduced from 6.5 percent to 4 percent in July 2019 (employer contribution from 4.75 percent to 3.25 percent and employee contribution from 1.75 percent to 0.75 percent). 

The employee who exempt under ESI Act, 1948:

  • The ESIC system does not cover workers or employees earning more than Rs.21,000 per month, and the maximum monthly income for people with disabilities is Rs.25,000. 
  • In Maharashtra and Chandigarh, the current coverage criterion is still 20 employees, rather than 10 in other states or UTs.
  • Employees with a daily average wage of up to Rs.137 are exempt from contributing.

Eligibility for ESIC Atal Bimit Vyakti Kalyan Yojana 

To get eligible under ESIC Atal Bimit Vyakti Kalyan Yojana, 

  1. The employees must be covered under Section 2(9) of the ESI Act of 1948;
  2. During the period of the claim for relief, the Insured Person (IP) must be unemployed;
  3. The insured person must have worked in insurable employment for at least two years.
  4. The Insured Person’s contribution should not be less than 78 days during each of the four contribution periods.
  5. Unemployment should not be caused by punishment for misconduct, superannuation, or voluntary retirement.
  6. The Insured Person’s Aadhar and Bank Account must be linked.

Disentitlement for relief under ESIC Atal Bimit Vyakti Kalyan Yojana 

ABVKY relief is not admissible in the following circumstances:

  1. During the lockout.
  2. Employees went on strike, which was declared illegal by the appropriate authorities.
  3. Voluntary job termination/voluntary retirement/premature retirement
  4. Contributory service of fewer than two years.
  5. When you reach the age of superannuation.
  6. Convicted (punished for making a false statement) under Section 84 of the ESI Act and Rule 62 of the ESI (Central) Rule
  7. If he or she is re-employed elsewhere during the period in which he or she is receiving ABVKY relief.
  8. Dismissal/termination as a result of disciplinary action.
  9. On the death of IP (insured person).

Benefits under the Scheme of ABVKY

  • The scheme provides relief to the extent of 50% of the average daily earnings during the previous four contribution periods (total earnings during the four contribution periods/730) to be paid up to a maximum of 90 days of unemployment once in the Insured Person’s lifetime.
  • After a minimum of two years of Insurable Employment and subject to the contributory conditions, an IP (insured person) will be eligible to draw the Relief under the Atal Beemit Vyakti Kalyan Yojana (ABVKY) for a maximum of 90 days once in a lifetime. After three months of clear unemployment, the claim for relief under the Atal Beemit Kalyaan Yojana will be payable. The compensation will be paid for each month of unemployment. There will be no allowance for prospective claims.
  • If the beneficiary finds gainful employment between the three months of unemployment for which he was eligible for ABVKY relief, the relief will be paid for the clear month of unemployment between the date of unemployment and the date of re-employment. In this case, the beneficiary may claim the remaining 90 days of relief in the same manner as described above, based on the initial contributory conditions, if he becomes unemployed from Insurable employment again within one year of his initial unemployment.

Online procedure for applying under the Scheme of ESIC Atal Bimit Vyakti Kalyan Yojana

The following steps should be followed to claim the ABVKY scheme. These steps are:

  1. Step 1: Visit the ESIC Official Website.
  2. Step 2:  It directs the applicant to the website’s Home Page.
  3. Step 3: Click on the Atal Bimit Vyakthi Kalyan Yojana ( ABVKY) link i.e. [email protected] on the home page.
  4. Step 4: When you click on the link, the Application Form in PDF format opens.
  5. Step 5: The form can be downloaded into the system, and applicants can begin filling it out.
  6. Step 6: Begin by filling out the ESIC ABVKY Form with your basic information such as name, insurance number, Aadhar number, and bank information such as bank name, account number, branch IFSC code.
  7. Step 7: Enter the insured person (I.P.) Insurance Number, Name of the Insured Person, Father’s/Name, Husband’s and the Applicants’ Complete Permanent Address in the Registration Form.
  8. Step 8: Enter the employer’s name, code number, and address.
  9. Step 9: Date of Appointment and Date of Unemployment should be entered.
  10. Step 10: Enter the Contribution Period, Number of Days, Wage Amounts, RC/CCP/ESIC 71 Register SI Number, and Employer Code Number.
  11. Step 11: To answer the question, select Yes or No. Is there a copy of the Employer’s forwarding?
  12. Step 12: To answer the question, select Yes or No. Is the I.P. receiving any other type of equivalent benefit?
  13. Step 13: Select Yes or No for the question “Are you eligible for ABVKY?”
  14. Step 14: In Rupees, enter the Relief amount under ABVKY.
  15. Step 15: Applicants must submit the completed form, along with the appropriate documentation, to the selected branch office.
  16. Step 16: The Bank’s staff will examine the forms that have been submitted.
  17. Step 17: After that, the system will calculate the claimant’s amount and determine the amount to be paid to the Insured Person.
  18. Finally, the sum is credited to the insured person’s bank account ( I.P).

Role of Atal Bimit Vyakti Kalyan Yojana in in granting unemployment allowance to workers amid pandemic

Many people got retrenched from their jobs as a result of the Covid pandemic. Thus, to evacuate the workers from this situation, the government’s Atal Bimit Vyakti Kalyan Yojana was made available for those who work in the organized sector and their employer deducts PF / ESI from their salary every month. Then, 

  • The central government will provide the funds for the next 24 months under the scheme of ABVKY.
  • The government has also decided to increase the rate of unemployment relief under the scheme to 50% of wages from 25% previously, as well as relax eligibility criteria until December 31, 2020. The “Atal Beemit Vyakti Kalyan Yojana” has been extended by ESI Corporation (ESIC) for another year, until June 30, 2021, after December 31, 2020.
  • Those who lost their jobs due to a pandemic can receive unemployment benefits of up to 50% of their wages for up to three months, even if they have resumed work, under the Atal Bimit Vyakti Kalyan Yojana. 
  • Previously, financial assistance was provided within 90 days of job loss, but that time frame has now been reduced to 30 days due to a covid outbreak.
  • Instead of having the claim forwarded by the last employer, the Insured Person can submit, duly completed online or directly the claim to the ESIC Branch Office, and payment will be made directly into the IP’s bank account. 
  • ESIC has ordered where an employer has indicated “Zero” contribution with respect to an employee for some time before withdrawing him from the system, the relief under ABVKY for that period of “Zero” contribution will be allowed. Only those beneficiaries who have been removed from the employer’s payroll will be eligible for payment of relief under ABVKY if they meet all other eligibility requirements.


The Employees’ State Insurance Corporation (ESIC) launched the Atal Beemit Vyakti Kalyan Yojana on a pilot basis for two years, beginning on July 1, 2018, to provide help to unemployed insured persons (IPs). Since its commencement, a total of 43299 people have benefited from the scheme, with a total of Rs.57.18 crore disbursed.

The immense contribution made by the Government of India during the Covid 19 outbreak was to give attention to the difficulties that beneficiaries have faced. To resolve this issue the Government of India has been decided that claimants who have submitted their claims under the Atal Beemit Vyakti Kalyan Yojana online and uploaded scanned copies of the required documents, such as copies of Aadhar and bank details, do not need to submit a physical claim. If the documents are not uploaded when the claim is filed online, the claimant will submit a printout of the claim, duly signed, along with the required documents. The requirement to submit the claim in Affidavit Form has been waived.


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