WORKMEN’S

COMPENSATION ACT, 1923 EMPLOYEE’S COMPENSATION

(Amendment) ACT, 2009

FEATURES OF THE ACT

Provides for cheaper and quicker mode of disposal of

disputes relating to compensation through special

proceedings

Provides compensation to employees for injury caused

by accident and occupational disease arising out of and

in the course of employment

Applicable to apprentice also

Employee’s compensation is not payable:

To persons insured under ESI, 1948

If employee is under influence of drink or drugs

If employee wilfully disobeys instructions or safety rules

DEFINITIONS

COMPENSATION- means as provided for by

this Act

• DEPENDANT- (i) widow, minor legitimate or adopted son, unmarried legitimate or adopted daughter and widowed mother (ii) if wholly dependant on the earnings of the workman at the time of death, son or daughter who has attained the age of 18 years and who is infirm (iii) if wholly or in part dependant on the earnings of the workman at the time of death, (a) widower (b) parent other than widowed mother et al (c) Minor brother/ unmarried sister/ minor son/ minor daughter

PARTIAL DISABLEMENT- means

where the disablement is of temporary nature, such disablement as reduces the earning capacity of a workman in the employment he was engaged at the time of accident resulting in the disablement, and

where the disablement is of permanent nature, such disablement as reduces the earning capacity in every employment which he was capable of undertaking at that time provided that every injury specified in Part II of Schedule I is deemed to result in permanent partial disablement

TOTAL DISABLEMENT- means

such disablement, whether of a temporary or permanent nature, as

incapacitates a workman for all work which he was capable of

performing at the time of accident resulting in such disablement

provided that permanent total disablement is to be deemed to result from

every injury in Part I of Schedule I or combination of injuries specified in

Part II where the aggregate percentage of loss of earning capacity

amounts to one hundred percent

M, a mechanist in an engineering shop, got his fingers cut

off by accident. This injury has reduced his capacity to work

in any such employment.

A is a helper with public health engineering department.

While cleaning overhead tank, he slipped and fell, fracturing

his both hands. He could not work for one more month.

B lost both his eyes and his leg when the bus he was

driving met with an accident. He can no longer work as a

driver or any other work of similar nature.

An accident left a worker- a porter- with a sprain in his leg,

making him incapable of performing his work as a porter.

However, he could do some other work.

Section 3(1)- Employers liability for

compensation

In case of personal

injury

In case of occupational

disease

If personal injury is caused to a workman by

accident arising out of and in the course of

employment

The cause

contemplated is the

proximate cause and

not any remote cause

Period of employment

and place of work

If a workman employed in any employment specified in Part

A of Schedule III contracts any disease specified therein as

occupational disease peculiar to that employment specified

in Part A, B or C of Schedule III, the contracting of the

disease shall be deemed to be injury by accident

DOCTRINE OF NOTIONAL

EXTENSION

Employee is doing

master’s job

Nexus between the time

and place of accident and

the employment

Covers when:

-Employee is resting

-having meals/ tea

-proceeding from

place of employment

to his residence

NEXUS BETWEEN THE

TIME AND PLACE OF

ACCIDENT AND THE

EMPLOYMENT

DOCTRINE OF ADDED PERIL

SELF-INFLICTED INJURY

CONTRIBUTORY NEGLIGENCE

Facts of the case:

An electrician who had to go frequently to a heating plant from

cooling plant, contracted pneumonia which resulted in his death.

Decision of the case:

It was held that injury caused by an accident is not confined only to

physical injury and in this case it was due to his working conditions

and going from a heating room to a cooling plant as it was his

indispensable duty.

The dependants of the deceased workman were entitled

compensation

Personal injury also include nervous shock

or breakdown or mental strain

Indian News Chronicle v Mrs. Lazarus

1961

Facts of the case:

Daughter of appellant claimant, an ayah in the respondent hospital,

fell down from the staircase of the hospital resulting in her death. As

dependant of the deceased, the mother claimed compensation.

The claim was rejected by commissioner due to the fact that the

deceased was not in employment since August, 1988 and did not die

due to injuries but because of TB she was suffering from. An appeal

was filed.

Decision of the case:

It was held that the death would not be treated as an accident for

claiming compensation since the deceased has died of TB and

she was not an employee of the hospital

Thangammal v Management, OBLI

Hospital, Salem 2010

Thangammal v Management, OBLI Hospital, Salem

2010

Facts of the case:

Driver of vehicle met with an accident and died after one month of receiving injuries on duty. The

commissioner awarded compensation to legal heirs. The order was challenged by insurer of vehicle on the

ground that there was no intervening cause for death between time of accident and death.

Decision of the case:

Held, death occurred only due to head injury sustained by

deceased in the accident and will be treated as employment

injury, hence, dependents will be entitled to be compensation.

United India Insurance Company Ltd., Chennai

vs. Sivagami and Others. 2010 LLR 135

Divisional Forest Office v Fagua Sai, 2008

Decision of the case:

It was held that the accident had casual connection with the

employment and arose out of it. High court upheld the award

and ask to release the amount of compensation.

Divisional Forest Office v Fagua Sai, 2008

Facts of the case:

The applicant Fagua Sai being the father of deceased

Dhaneshwar Sai filed an application before the lower court for

compensation It is an admitted fact that Dhaneshwar Sai was

working in the course of his employment when lightening struck

at 4 pm. Since he was working in open field while it was raining

the nature of employment exposed him to such hazards.

Divisional Forest Office v Fagua Sai,

2008

Facts of the case:

Bipul Gogoi was appointed as a Driver of a vehicle bearing

Registration No.AS-09/2289 by the third respondent. He

reported to his duty at about 9.30 am on 9.10.1996. He was

since then not heard by the members of his family or by his

employer. The vehicle was not traced. No dead body was found.

Whether the said Bipul Gogoi had died or still alive is not

certain.

Decision of the case:

The legal heirs will not be entitled to compensation in the

absence of proof of death that there has been an accident

arising out of and in course of employment. Further, no

presumption can be drawn upto a period of 7 years if a person is

not heard.

Oriental Insurance Company Ltd vs Sorumai

Gogoi & Ors on 14 February, 2008

Facts of the case:

The claimants- respondents had filed a petition seeking compensation in

respect of death of a driver, who had committed suicide. It was contended

that after finishing his duty the deceased had returned home and it is claimed

that he was under extreme pressure because of harassment at work by his

superiors. Therefore it was urged that the accident of the workman had a

casual connection with the employment and arose out of it. The labour

commissioner having awarded compensation in the face of the contest, the

present appeal is filed.

Decision of the case:

Schedule III of the ECA, 1923 which lists out “occupational

diseases” does not include suicide. Therefore the amount in

deposit is to be refunded to the appellant

Maharashtra State Road Transport Corporation v

Meenaxi Dhareppa Koli, 2006

Dockendate shipping Bombay & Anr v

Jevanbhai Ramji Tandel, 2006

Facts of the case:

The workman had been in service from 18.5.1990. On 25.12.1990 he

suffered a cerebral stroke while at sea. He was therefore taken ashore and

was treated in a hospital. Thereafter, in Jan 1991 he was repatriated to India

and was admitted to hospital for further treatment. On 11.02.1991, his son

had discharged him from the hospital against the medical advise and

returned to their native place. The respondent workman claims an amount of

Rs. 15 Lakhs as compensation contending that he was suffered from an

accident arising out of and in the course of employment.

Decision of the case:

Held, the workman is not entitled to compensation as the

respondent has been unable to show nexus between

employment injury and the nature of work that he performed.

Facts of the case:

Deceased working as driver after loading his truck fell ill on his

way and asked cleaner to drive his truck. On 20.05.94 at 4.00

am, some army personnel stopped vehicle and asked persons

sitting inside the truck to come down. Due to illness, deceased

driver took some time to come down which infuriated army

personnel who fired at him resulting in his death.

Decision of the case:

Held, the accident has occurred arising out of and in course of

his employment and compensation is payable.

United Insurance Co Ltd v Nirmal kaur &

Ors. 2006

New India assurance Co Ltd Bangalore v

KS Puttappa & Ors. 2008

Facts of the case:

A person appointed as a cleaner drives the vehicle and accident

occurred. The grievance of the insurance company is that the

deceased was not found to have been on duty as a “driver” at

the time of accident and therefore, the question of liability will

not arise.

Decision of the case:

Held, the commissioner was at error in treating accident as

arising out of and in course of employment and compensation

shall be refunded.

Divisional Controller, NW Karnataka Road

Transport Corporation v Drakshyani & Ors. 2006

Facts of the case:

The deceased driver was entrusted the duty of driving the bus

on a particular route. The deceased was free to go home after

duty hours, yet he stayed back for rest on the terrace of the bus

stand. In the morning while getting down from the terrace, the

deceased tumble down resulting in his death.

Decision of the case:

Held, the cause of accident is totally unconnected with the nature

of employment. The fact that accident occurred at work place is

not significant criteria for fastening liability on the employer. The

manner of accident and cause of death cannot be deemed to be

arising out of and in course of employment. The employer is not

liable to pay compensation.

Management of HAL, Helicopter Division

Bangalore v L. Fathima Mary and Ors. 2010

Facts of the case:

A skilled employee working in night shifts died due to heart

attack.

Decision of the case:

Held, that development of chest pain, while discharging night

duties is only on account of stress and strain during course of

employment. It will be considered as an accident arising out of

and in course of employment.

Ushaben J Rana v Project manager ONGC,

2006

Facts of the case:

The deceased Jashubhai Rana expired in the accident while

performing his duty in course of employment. Employer ONGC

has given a job to wife of the deceased. The question arose was

that the fact that wife was given a job by ONGC can be

considered for deducting compensation or not.

Decision of the case:

In the opinion of court, while the deceased was serving he

was getting salary for the work done by him, after his death his

wife is getting salary for the work done by her. It is neither

gratuitous payment nor ex-gratia payment. The policy of

compassionate appointment cannot be used as a sword to

slash the compensation amount. So no deductions can be

made from the compensation.

AMOUNT OF COMPENSATION Nature of Injury Amount of compensation

Death 50% of monthly wages multiplied by

relevant factor

OR

Rs. 1,20,000

Whichever is higher

Permanent total

disablement

60% of monthly wages multiplied by

relevant factor

OR

Rs. 1,40,000

Whichever is higher

Permanent Partial

disablement

Part II of Schedule I specified injury-

such percentage as payable in case of

Permanent total disablement

Part II of Schedule I unspecified injury-

proportionate to loss

Temporary Disablement

(Total/ Partial)

25% of monthly wages

NUMERICAL

A workman is employed in a factory on a

monthly wage of Rs 3000. While working he

met with an accident and dies on oct 2000.

His date of birth is July 18 , 1970. The

amount of compensation payable to his

dependent would be: Schedule IV:..\IDA 1947\The Workmen’s Compensation Act, 1923_

SCHEDULE IV.html

NUMERICAL

A workman is employed in a factory on a

monthly wage of Rs 3000. While working he

met with an accident and lost his eyes on oct

2000. His date of birth is July 18 , 1970. The

amount of compensation payable to his

dependent would be

Schedule

II

Schedule III

Schedule IV

Contains list of persons engaged in different employment/

operations who are covered by definition of workman

Contains list of occupational diseases if contracted while

in employment entitles a workman to compensation

Lays down the relevant factor related to the age of workman at

time of death, injury or accident by which wages are multiplied to

arrive at compensation

TIME LIMIT FOR PAYMENT OF

COMPENSATION(SEC 4A)

Simple interest @ 12%

pa

Further sum not exceeding

50% of such amount by

way of penalty

If employer fails

to pay within 1

month from

due date:

AS SOON AS IT IS

DUE

Comparison between ESI 1948

and ECA 1923 Basis ECA 1923 ESI 1948

Preamble It is restricted to providing

compensation to the employees for

injury caused to employees arising

out of and in course of employment

It provides benefits to workmen

in case of sickness, maternity

and employment injury

Coverage Employment injury or deaths arising

from accidents or occupational

disease

Employment injury or deaths

arising from accidents or

occupational disease, sickness

and maternity

Schemes It offers non contributory set up

wherein employer has to pay entire

compensation

It offers contributory scheme

Payment

responsibility

Employer ESIC

Supremacy Not much attractive as it provides

lesser compensation

Judicial pronouncement have

upheld the supremacy of this act

Recent Amendments

Informing employees of their rights to

compensation

Imposition of fine (maximum fine from 5000

to 50000)

Commissioner not to withhold payment

during the pendency of an appeal by

employer