Workman Compensation Act

Objectives :
The Workmen's Compensation Act, 1923, aims to provide workmen and/or their dependents
some relief in case of accidents arising out of and in the course of employment and causing
either death or disablement of workmen.
Scope and Coverage

The Act extends to the whole of India .

The Workmen's Compensation (Amendment) Act, 2000 has brought all the workers
within its sphere irrespective of their nature of employment i.e. whether employed on
casual basis or otherwise than for the purposes of the employer's trade or business.

For the first time, casual laborers will be provided compensation for death or disability.

Establishments which are covered by the Employees State Insurance Act, are outside the
preview of this Act. The coverage of this act is also to cooks employed in hotels and
restaurants.

Employees Entitled

Every employee including those employed through a contractor and also casual
employees, who suffers an injury in any accident arising out of and in the course of his
employment, shall be entitled for compensation under the Act.

A person employed in a factory which is yet to commence production would not be

deprived of the benefit of the provisions of the Act.

The workman employed in a premises where manufacturing process is intended to be

carried on is not necessarily required to be actually connected with manufacturing
process.

Any person engaged in such premises who is contributing for the intended
manufacturing process would be deemed to be workman for the purpose of the Act.

Definition:

DEPENDANT:-Dependant means any of the following relatives of a dead workman,

namely: a widow, a minor legitimate or adopted son and unmarried legitimate or
adopted daughter, or a widowed mother, and if wholly dependant on the earnings of
the workman at the time of his death, a son or a daughter who has attained the age of 18

years and who is infirm, And any of the following wholly or partly dependent on the
workman at the time of his death a widower, a parent other than a widowed mother, a
minor illegitimate son, a unmarried illegitimate daughter, a widowed daughter in law, a
minor child of the dead son & daughter & a paternal grandparent if not the parent of the
workman is alive.
Disablement

Injury caused to a workman by an accident usually results in the loss of the earning
capacity of the workman concerned and this loss of earning capacity is technically
"disablement".

Disablements can be classified as (a) Total, and {b) Partial. It can further be classified
into (i) Permanent, and {ii) Temporary

Accident Compensation-when payable :

The employer of any establishment covered under this Act, is required to compensate an
employee: who has suffered an accident arising out of and in the course of his
employment, resulting into (i) death, (ii) permanent total disablement, (iii) permanent
partial disablement, or (iv) temporary disablement who has contracted an
occupational disease accident arising out of and in the course of implies a casual
connection between the injury and the accident and the work done in the course of
employment.

Accident Compensation-when payable :

The employer of any establishment covered under this Act, is required to compensate an
employee: who has suffered an accident arising out of and in the course of his
employment, resulting into (i) death, (ii) permanent total disablement, (iii) permanent
partial disablement, or (iv) temporary disablement who has contracted an
occupational disease accident arising out of and in the course of implies a casual
connection between the injury and the accident and the work done in the course of
employment.

What are the condition for receiving compensation for Personal Injury caused by the
accident

At the time of injury workman must have been engaged in the business of the employer
and must not be doing something for his personal benefit;

That accident occurred at the place where he was performing his duties; and Injury must
have resulted from some risk incidental to the duties of the service, or inherent in the
nature or condition of employment.

When is an Employer not liable to pay compensation ?

if the injury did not result in total or partial disablement of a workman for a period
exceeding three days,

if the workman was at the time of the accident under the influence of drink of drug, or

if the workman willfully disobeyed an order expressly given or a rule expressly framed
for the purpose of securing safety of workman, or

If the workman willfully removed or disregarded any safety guard or other device which
to his knowledge was provided for the purpose of securing his safety

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, and the relevant
factor for working out lump sum equivalent of compensation amount.

There is no distinction between an adult and a minor worker with respect to the amount
of compensation.

COMPENSATION FOR DEATH

In case of death resulting from injury, the amount of compensation shall be equal 50% of
the monthly wages of the deceased workman multiplied by the relevant factor. Or an
amount of Rs 80,000/- whichever is more.

COMPENSATION FOR PERMANENT TOTAL DISABLEMENT In case of

permanent total disablement resulting from the injury, the amount of compensation shall
be 60% of the monthly wages of the injured workman multiplied by the relevant factor or
Rs 90,000/- thousand whichever is more.

COMPENSATION FOR PERMANENT PARTIAL DISABLEMENT

in case of an injury specified in part II of the schedule I, the amount of compensation

shall be such percentage of the compensation which would have been payable is the
percentage of loss of earning capacity caused by that injury. in case of an injury not
specified in schedule I, such percentage of the compensation is payable which is
proportionate to the loss of earning capacity (as assessed by a qualified medical
practitioner) permanently caused by the injury.

COMPENSATION FOR TEMPORARY DISABLEMENT (TOTAL OR PARTIAL) :

If the temporary disablement, whether total or partial results from the injury, the amount
of compensation shall be a half monthly payment of the sum equivalent to 25% of the
monthly wages of the workman to be paid in accordance with the provisions. The half
monthly payment shall be payable on the sixteenth day from the date of disablement In
cases where such disablement lasts for a period of 28 days or more compensation is
payable from the date of disablement In other cases After the expiry of a waiting period
of three days from the date of disablement.

COMPENSATION TO BE PAID WHEN DUE AND PENALTY FOR DEFAULT (section

4A) :

As per this section, compensation has to paid as soon as it is due In case the employer
does not accept the liability of paying the compensation, he is bound to make provisional
payment to the extent of the liability he accepts. Such amount has to be deposited with
the commissioner or paid to the workman. If he defaults, the commissioner may order:
the payment of the amount with interest at12 % per year if the default to be unjustifiable
then the commissioner may order payment of a further sum not exceeding 50% of the
amount due, by way of penalty.

Accident Report :

Accident Report Where the accident results in death or serious physical injury, the
employer should send a report to the Commissioner, within 7 days of the accident, in the
prescribed from giving the circumstances attending the death or serious bodily injury