Workmen’s Compensation Act, 1923 Introduction, Definitions, Employer’s Liability for Compensation, Rules as to Compensation, Commission and Procedure before them

Workmen’s Compensation Act, 1923 is a pivotal piece of legislation in India designed to provide financial protection and assistance to employees and their families in the event of injury, disability, or death arising out of and in the course of employment. This Act applies to a broad category of workers and industries, ensuring that employees who suffer from work-related injuries or diseases that result in partial or total disablement or death are compensated accordingly. The Act also extends to certain diseases that are deemed to be industrial diseases, specific to particular occupations.

Key definitions under the Act:

• Workman:

This term encompasses a wide range of employment categories, broadly covering any person (excluding those employed in managerial or administrative capacities) who is employed in any kind of trade, business, or manufacture wherein an employer-employee relationship exists. The definition is inclusive but carries certain exclusions as per the Act.

• Dependent:

Refers to any individual who is a member of the injured workman’s family and who relied upon the workman for financial support.

• Disablement:

Classified as either ‘temporary’ or ‘permanent,’ disablement can be partial or total, affecting an employee’s earning capacity. The Act provides specific criteria for assessing the degree of disablement and the corresponding compensation.

• Employer:

Includes any person or entity that employs one or more employees in a capacity that falls under the Act’s purview, and can also extend to contractors who employ workers.

Employer’s Liability for Compensation:

Under the Workmen’s Compensation Act, 1923 (now known as the Employees’ Compensation Act), an employer’s liability for compensation is established in cases where a workman (employee) sustains an injury by accident arising out of and in the course of employment, resulting in disability or death. This act ensures that employees or their dependents are compensated for injuries or death that occur in the workplace or as a result of employment activities. The act applies to a specified category of workers engaged in certain types of employment, as listed in the Act.

Key Aspects of Employer’s Liability:

• Accident Arising out of and in the Course of Employment:

The injury must occur as a result of the employment and take place during the employment period. This includes injuries sustained while performing duties related to the job or even in some cases, injuries occurring during the commute if the mode of transportation is provided by the employer.

• Scheduled Diseases:

The Act also covers occupational diseases listed in a schedule, which are deemed to arise out of employment, making the employer liable for compensation if a worker contracts any such disease.

• Exemptions:

There are certain conditions under which the employer’s liability is negated. This includes injury or death resulting from the employee’s willful disobedience or misconduct, or intoxication at the time of the accident.

• Amount of Compensation:

The Act specifies the formula for calculating the amount of compensation based on the severity of the injury (temporary or permanent disability) or in the case of death. The compensation amount depends on factors like the employee’s age, wages, and the nature of the disability.

• Dependents’ Compensation:

In the event of a worker’s death, the Act provides for compensation to be distributed among the worker’s dependents as defined under the Act.

• Notice and Claim:

The Act requires that the employer be notified of the accident within a specified period, and it outlines the process for claiming compensation.

Rules as to Compensation:

Workmen’s Compensation Act, 1923, outlines specific rules regarding the compensation payable to employees (referred to as “workmen” in the Act) in cases of injury by accident arising out of and in the course of employment, or to their dependents in the case of the employee’s death. These rules are crucial for ensuring fair compensation for workplace injuries or fatalities, reinforcing the legal responsibility of employers towards their employees’ safety and well-being. Here is a summary of the key rules as to compensation under the Act:

1. Nature of Compensation:

Compensation is payable for personal injury caused by accidents arising out of and in the course of employment, leading to death, permanent total disablement, permanent partial disablement, or temporary disablement, whether total or partial.

2. Quantum of Compensation:

The amount of compensation varies depending on the nature and severity of the injury. It is calculated based on the employee’s wages, the nature of disablement, and, in the case of death, the statutory limits provided in the Act.

3. No Compensation in Certain Cases:

The Act specifies situations where the employer is not liable to pay compensation. This includes:

• Injury that does not result in the total or partial disablement of the employee for a period exceeding three days.
• Injury caused by an accident directly attributable to the employee being under the influence of alcohol or drugs at the time of the accident.
• Injury caused by the willful disobedience of the employee to an order expressly given, or to a rule expressly framed, for the purpose of securing the safety of employees.
• Injury caused by the willful removal or disregard by the employee of any safety guard or other device that he knew to have been provided for the purpose of securing the safety of employees.

4. Notice of Accident and Claim for Compensation:

The employer must be notified of the accident in a prescribed manner and within a specified period. Likewise, a claim for compensation must be made within the time limits set by the Act.

5. Distribution of Compensation:

In case of the death of an employee, the compensation is payable to the dependents as defined in the Act, which could include a spouse, children, dependent parents, and siblings.

6. Method of Calculating Wages:

The Act provides a method for calculating wages for the purpose of determining compensation, which includes taking into account the average monthly wages of the employee over a specified period prior to the accident.

7. Provision for Half-monthly Payments:

In cases of temporary disablement, the compensation may be paid in half-monthly installments, subject to the conditions and limitations prescribed.

8. Medical Examination:

The employer has the right to require the employee to undergo a medical examination to ascertain the nature and extent of the disablement caused by the injury.

Commission and Procedure before them:

Workmen’s Compensation Act, 1923, provides a mechanism for the settlement of compensation claims through Commissioners. These Commissioners are empowered to adjudicate matters related to the compensation of workers who suffer from injuries arising out of and in the course of their employment, or in cases of occupational diseases linked to the type of employment. The Commission and procedure before them are defined under the Act to ensure a fair, just, and expedient resolution of compensation claims.

Commission:

• Appointment and Qualifications:

Commissioners are appointed by the Government and are usually required to have qualifications or experience in law. Their primary role is to adjudicate compensation claims under the Act.

• Jurisdiction:

Commissioner has jurisdiction over matters within the geographical area for which they are appointed. They have the authority to hear and decide on cases of injuries or diseases that fall under the purview of the Act.

Procedure before the Commission:

1. Application for Compensation:

An injured workman or, in the case of death, the dependents of the workman can file an application seeking compensation. The application must be made in a prescribed manner and within the stipulated time frame.

2. Notice and Hearing:

Upon receiving an application, the Commissioner issues notices to all parties involved and sets a date for hearing. The procedure followed is generally summary in nature, focusing on the facts and evidence relevant to the compensation claim.

3. Evidence and Examination:

The Commissioner may require the submission of evidence, documents, and may also order medical examinations to ascertain the extent of injuries or the nature of the occupational disease.

4. Award of Compensation:

After considering the evidence and applying the relevant provisions of the Act, the Commissioner makes an award determining the amount of compensation due. The decision is based on the degree of disability, the earning capacity of the workman, and other relevant factors.

5. Disbursement of Compensation:

The compensation awarded is directed to be paid by the employer to the injured workman or, in the case of death, to his dependents.

6. Appeals:

Decisions made by the Commissioner can be appealed in the courts, subject to the conditions and limitations specified in the Act.