Section 80: Fraudulent Claims by Employees or Beneficiaries

Overview

Section 80 of the Code on Social Security, 2020 addresses fraudulent claims made under any benefit provided by this Code. This encompasses a wide range of social security schemes, including provisions relating to Provident Fund (PF), Employees’ State Insurance (ESI), gratuity, maternity benefits, and other schemes established under the Code. The core purpose is to deter and penalize dishonest attempts to obtain benefits to which an individual is not rightfully entitled, thereby safeguarding the financial integrity of these schemes.

Who is Covered?

• This section applies to all employees covered under the Code, regardless of the specific scheme. This includes workers in both the organized and unorganized sectors, as defined by the Code.
• It also extends to dependants (like family members) who may be claiming benefits due to the employee’s circumstances (e.g., survivor benefits).
• Furthermore, any beneficiary receiving benefits under the Code is covered, meaning anyone who receives payments or advantages from a social security scheme.
• Eligibility for the underlying social security schemes themselves varies. For example, PF eligibility often depends on working in a covered establishment and meeting a minimum wage threshold, while ESI coverage is linked to specific wage ceilings and employment in covered factories or establishments.

Benefits and Contributions

• The specific benefit received depends on the scheme. This could include pension payments, medical benefits, disability benefits, maternity benefits, gratuity payments, or other forms of financial assistance.
• Contribution responsibilities vary by scheme. Generally, contributions are made by the employer, the employee (a percentage of their wages), and sometimes the government. The Code aims to streamline these contributions across different schemes.

Procedure and Compliance

While Section 80 doesn’t detail the claim process itself, it impacts how claims are handled if fraud is suspected. If a claim is found to be fraudulent, the following generally occurs:

1. Investigation: Authorities will investigate the claim to determine if it was knowingly false.
2. Recovery: Any amounts wrongly paid to the employee, dependant, or beneficiary will be recovered.
3. Penalties: Penalties, as prescribed under the Code, will be imposed on the individual who made the fraudulent claim. The specific penalty amount will depend on the nature and severity of the fraud.

Employees should always submit accurate information and genuine documentation when making claims. Employers have a responsibility to ensure the accuracy of information provided on behalf of their employees.

Practical Examples

• Example 1: An employee submits a forged medical certificate claiming a disability benefit to which they are not entitled. Upon investigation, the fraud is discovered. The employee will be required to repay the benefits received and will be subject to a penalty.
• Example 2: An employer falsely declares a higher number of employees to claim greater ESI benefits. This is discovered during an audit. The employer will be required to repay the excess benefits received and will be subject to a penalty.

Disclaimer

This article is for basic understanding of social security law and should not be treated as legal advice. For specific legal guidance, please consult with a qualified legal professional.