EMPLOYEE’S COMPENSATION ACT, 1923

“If you take care of your workers, they’ll take care of your business”

Workmen’s Compensation Act, 1923 Act was later renamed as Employee’s Compensation Act, 1923. It came into effective from 1st July 1924. This act provides social security to employees. It aims to provide workmen or dependents that dies or suffers disablement (partial/total) due to accidents arising out of and in the course of employment is entitled to get compensation from his employer

SCOPE & COVERAGE

  • The Act extends to the Whole of India.
  • It applies to workmen employed in factories, mines, plantation,  transport establishment, construction work ,railways, ships, circuses & other hazardous occupations & employments specified in Schedule II to the Act.
  • The Act is not applicable to the members of Armed Forces of the Union & those workers who are insured under the Employees State Insurance Act 1948.

STRUCTURE OF THE ACT

This Act contains- 36 sections into 4 parts that is 4 schedule

SCHEDULE 1: List of injuries

  • Total disablement
  • Partial disablement

SCHEDULE 2: List of persons who are included in the definition of employees.

SCHEDULE 3: List of occupational diseases.

SCHEDULE 4: Factors for working out lump sum equivalent of compensation amount in case of permanent disablement and death.

DISABLEMENT

  • Loss of capacity to work or to move 
  • It may result in loss or reduction of his earning capacity 
  •  the employee is not able to work as much as he used to earn before his disablement 

According to section 2(1)(g) of Employees Compensation Act, 1923 it can be classified into categories i.e.:

  1. Temporary partial disablement:

It is a situation in which earning capacity of an employee decreases due to temporary disablement to perform his duty in the course of employment.
 

  1. Permanent partial disablement:

In such a situation the earning capacity of employee deemed to be reduce permanently in every course of employment that he was capable of taking at that point of time.

According to section (2)(l) of Employees Compensation Act, 1923 it can be classified into two categories i.e.:

  1. Temporary total disablement-In this case the injury is such that it causes disablement of a nature, which leads to incapacity of performing any duty as he could at the time of accident.
  1. Permanent total disablement- it includes any such injury as specified in part I of Schedule I. Further total disablement includes those injuries as specified in part II.

DOCTRINE OF NOTIONAL EXTENSION

It means when the employer provides the employee with a particular conveyance to and from the place of employment, the employee is regarded as in the course employment even though he has not reached or has left his employer’s premises.

EMPLOYER’S LIABIILITY TO PAY COMPENSATION

  • He must be working during the act.
  • Personal injury caused by accident.
  • Accident should happen during the course of employment.
  • Employer is liable to pay compensation in case of personal injury/occupational disease.
  • Personal injury includes physical/mental injury & strain & shock caused by excitement.    
  • Must result in death/permanent or temporary disability.

AMOUNT OF COMPENSATION

The amount of compensation payable to a workman depends on the nature of injury caused by accident , the monthly wages of the workman concerned.

  • IN THE CASE OF DEATH:

Amount of compensation= 50% of monthly wages x relevant factor/ Rs.1,20,0000 which ever is more.

  • TEMPORARY DISABLEMENT :

Amount of compensation= 25% of monthly wages.

  • PERMANENT TOTAL DISABLEMENT:

Amount of compensation= 60% of monthly wages x relevant factor/ Rs.1,20,0000 which ever is more.

  • PERMANENT PARTIAL DISABLEMENT:

Amount of compensation= 60% of monthly wages x relevant factor.

EMPLOYER IS NOT LIABLE

  • If the injury does not result in disablement in 3 days.
  • Injury/death results in permanent disability because
  1. Worker was under the influence of drugs/drinks.
  2. If the worker did not follow the safety precautions as instructed.
  3. If he wilfully removed the safety devices to cause harm.

PROCEDURE IN THE PROCEEDINGS BEFORE COMMISSIONER:

Section – 20 of the Act talks about this. A commissioner shall be appointed by the state of central government. A specific may regulate the business in case state government appoints more than one commissioner for a particular area. A commissioner can choose any person to assist him in inquiry provided he possess a special knowledge.

APPEALS:
Section-30 of the Act talks about appeals. An appeal can be made in front of High court by orders of commissioner.

  1. A lumpsum amount is awarded as compensation by way of an order, redemption of half of the monthly payment is away.
  2. Gain of a half monthly compensation shall be reduced by an order.
  3. Compensation shall be distributed to the family of deceased by an order, similarly a claim can be disallowed by an order.

CASE LAWS

NEW INDIA ASSURANCE CO. LTD .V. MOHAN KUMAR SAHU, 2004

Person engaged for one day to drive vehicle of the owner is also the employee in this act. The owner have definite control over the person. His engagement for one day only will not throw him out of the definition of employees of the act.

DEVIDAYAL RALAYARAM .V. SECRETARY OF STATE OF AIR ,1937

According to the Doctrine of Added Peril if a workman while performing his duty does something which is not required to do and which involves extra danger, the employer would not be liable to pay compensation if any injury caused to him.

Aishwarya Says:

I have always been against Glorifying Over Work and therefore, in the year 2021, I have decided to launch this campaign “Balancing Life”and talk about this wrong practice, that we have been following since last few years. I will be talking to and interviewing around 1 lakh people in the coming 2021 and publish their interview regarding their opinion on glamourising Over Work.

If you are interested in participating in the same, do let me know.

Do follow me on FacebookTwitter  Youtube and Instagram.

The copyright of this Article belongs exclusively to Ms. Aishwarya Sandeep. Reproduction of the same, without permission will amount to Copyright Infringement. Appropriate Legal Action under the Indian Laws will be taken.

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We also have a Facebook Group Restarter Moms for Mothers or Women who would like to rejoin their careers post a career break or women who are enterpreneurs.

We are also running a series Inspirational Women from January 2021 to March 31,2021, featuring around 1000 stories about Indian Women, who changed the world. #choosetochallenge

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