Employees compensation act 1923

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Employees compensation act 1923

  1. 1. Employees Compensation Act, 1923 (E.C.Act, 1923) Dr.K.PADMANABHAN Assistant Professor of Corporate Secretaryship Bharathidasan Govt. College for Women (Autonomous) Puducherry-605 003.
  2. 2. Note This PPT is prepared for the U.G. Students with a view to simplify the lengthy paragraphs. Your feed back & suggestions are invited for improvement of this PPT & to take efforts to prepare PPTs on other areas of Labour Laws & other areas of subject relating to Corporate Secretaryship. [drkpnabhan@rediffmail.com; 919842793943] 2 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  3. 3. Objective of the Act Objective of The E.C. Act, 1923 To provide Relief to Workmen and/or their Dependants if workmen Dead Disabled due to accidents arising out of and in the course of employment 3 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  4. 4. Defences Available to Employers Before Passing E.C.Act, 1923 Doctrine Risk of Assumed ‘volenti non fit injuria’-Where there is consent there is not injury. Employer not liable to pay compensation to employee for injury Doctrine of Employment Common Worker injured by some Worker working with act or omission of some several persons for of the persons of his common purpose. group. Employee not entitled to compensation for injury Doctrine of caused by his own negligence. (Employer not Contributory Negligence responsible for negligence on the part of employees). End of Personal Action Personal Action (of employee) came to an end with Death due to death of employee. 4 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  5. 5. Ways Open to Employees for Claiming Compensation Injured employee may File a Civil suit or Employee choice Claim compensation between these under E.C.Act,1923 two reliefs. Employee cannot file a suit for damages in any Court of Law if He filed E.C.Act,1923 claim Existence of agreement between under employee & employer for payment of compensation as per E.C.Act,1923. Comparison Civil Suit E.C.Act, 1923 Risky & costly 5 Employer can put forward all Safe & less costly. defences available to him under law of torts. Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  6. 6. Scope & Coverage of the Act Extends to whole of India Applies to employees employed in Not apply to Factories members of Armed Forces of Union Mines Employees covered by ESI Act, 1948. (Dependants’ Benefit available) Plantations Transport Establishments Construction works Railways Casual workers & workers employed otherwise than for employer’s trade or business. Ships Circuses 6 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  7. 7. Definitions Explanation Commissioner for Sec.2(1)(b) Commissioner Employees Compensation appointed u/s.20. Compensation as Sec.2(1)(c) Compensation provided for by this Act. Person who depends upon Sec.2(1)(d) Dependant another for his livlihood. (General Meaning). Section 7 Term Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  8. 8. Dependant Dependants-whether actually so or not. Wholly Dependant on the Dependants-Wholly or in Part earnings of the Employee at Dependant on the earnings of the Employee at the time of death. the time of death. Widow Widower Minor legitimate or adopted son. Parent other than a Widowed Mother. Unmarried legitimate or adopted daughter or Minor illegitimate son Widowed Mother Unmarried illegitimated daughter or daughter legitimate or illegitimate or adopted or adopted if married & a minor or Son or Daughter attained 18 if widowed & a minor. years of age and infirm. Minor brother or unmarried sister or a widowed sister if minor. Minor child of pre-deceased son. Minor child of pre-deceased daughter where no parent of child alive or. 8 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry. Paternal grandparent if no parent of the employee is alive.
  9. 9. Definitions Employer-Sec.2(1)(e):”Employer” includes • Any body of persons whether incorporated or not; • Any managing agent of an employer; and • The legal representative of a deceased employer. Disablement: Loss of capacity to work or to move. Disablement of an employee may result in loss or reduction of his earning capacity. (Not able to earn as much as worker used to earn before his disablement). [Eg.Before Disablement-Rs.200; After DisablementRs.100] 9 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  10. 10. Definitions Employer-Sec.2(1)(e): Employer includes Body of persons Legal Representative Managing Agent whether incorporated of a deceased of an employer. or not. employer. Disablement Loss of capacity to work or to move. Result loss reduction (Not able to earn as much as worker used to earn before his disablement) of earning capacity of employee. 10 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  11. 11. Disablement Disablement of an employee may result in loss or reduction of his earning capacity Partial Disablement Total Disablement [Temporary/Permanent] Reduces earning capacity Temporary Partial Disablement Reduces earning capacity of an employee in ANY EMPLOYMENT he was engaged at the time of accident. 11 Permanent Partial Disablement Reduces earning capacity of an employee in EVERY EMPLOYMENT he was capable of undertaking at the time of injury. Incapacitates an employee for ALL WORK he was capable of performing at the time of accident. Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  12. 12. Definition 12 Employees-Sec.2(1)(n) Master, Seaman /other member of crew of ship Captain/other member crew of aircraft Not permanently employed in any administrative, district or sub-divisional office of railway & not employed in capacity as specified in Schedule-II of Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry. Railway Servant Driver, helper mechanic, cleaner or in any capacity in Employed in connection with motor any capacity as vehicle. specified in Person recruited for work Schedule-II. abroad by companyemployed outside India in any capacity specified in Schedule-II. (Ship, aircraft/ motor vehicle/company – registered in India. Not include – employment of casual nature.[Casual Nature-Not regular/continuous]
  13. 13. Rules Regarding Employees' Compensation Employer’s Liability for Compensation: Employer is liable to pay compensation to an employee [Accident & Occupational Diseases] For personal injury caused to For any occupational disease employee by accident. contacted by employee. Accident Occupational Disease Arising out of (due to- Exposed to certain diseases reason) & in the course of inherent in those occupations. (during-time) employment. 13 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  14. 14. Employer’s Liability & Non-Liability to Pay Compensation 14 Employer Not Liable to Pay Compensation Liable to Pay Compensation For Injury caused to an employee by accident arising out of & in the course of employment – if not result in Occupational Disease Accident Total [a]Injury Partial Disablement Exceeding 3 days. arising out of and in exposed to [b]Workman the course of influence of employment, resulting certain diseases inherent in those drug into Disablement occupations Under [b] & [c] not liable to pay compensation not apply in case of workmen dead. (i.e.Employer Liable to pay compensation) [c]Workman willfully Death under At the time of drink/ disobeyed accident . Safety Rules Safety guard / removed / disregarded other device Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  15. 15. Sec 3(1) Linkages • personal injury by • accident event 15 context • arising out of and in the course • employment • employer liable to pay employee • compensation Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry. result
  16. 16. Personal Injury by Accident Eg. 1 2 16 Fact of the Case Decision Employee in course of his duties, frequently to go into a heating room Accident [Death & from there to a cooling room. One was due to personal night he went into the cooling room, Injury] he got phenumonia of which he dies. Death is result of an Person becomes insane as a result of accident. an accident & then commits suicide. [compensation to be awarded]. Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  17. 17. Arising out of & in the course of employment 17 "Arising Out Of and In The Course Of Employment” Arise Out of Employment In the Course of Employment Nexus [connectivity] must be Employee is helping the employer's business established between the accident and goals in doing the activity where the injury the employment occurred. Conditions Injury resulted from risk incidental to the duties of service. [Injury- during the course of employment]. Time during which employment continues. At the time of injury-worker engaged in business of employer. [Not involved for his personal advantage or benefit]. [emphasizes that there must be a [emphasizes the time when accidental injury casual connection between the was caused] employment and the accidental injury] arising out of - suggests the cause of in the course of - refers to the time, place, the accident and circumstances of the accident Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry. These words refer to the link between the cause of the accident and the employment.
  18. 18. Theory of Notional Extension Concept: Employer is liable for injury to his employee even when the employee is away from the premises at the time of accident. General Rule Employment of an employee does Not commence until he reached Not continue When he left the place place of employment. of employment. The journey to & from the place of work excluded. But Theory of Notional Extension Included the journey to & from the place of work. [Going to work place from residence or while returning from work place to residence]. If the employee dies due to accident while going to work place from residence or while returning from work place to residence, as an accident arising out of and during the course of employment and as such entitled for compensation.[Theory of Notional Extension] 18 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  19. 19. Cases of Accidents Arising Out of & In the Course of Employment Case A railway employee was ordered to travel to a certain station to repair a water main. When he had finished the work & was crossing the platform to catch the train, he slipped & died as a result. Accident Arose out of & in the course of employment  A watchman in the course of his duty lifted G.I.Pipe in order to keep it in a safe place. While doing so, he received injury.  An employee suffered from heart disease & died on account of strain of work by keeping continuously standing or walking.  An employee suffering from heart disease after having worked for 8 hours on a hot day in a mill collapsed. There was evidence to the effect that collapse was likely to have been caused by strain of work on a diseased heart. Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.  19
  20. 20. Occupational Diseases Workers employed in certain occupations are exposed to certain diseases which are inherent [its character] in those occupations. Eg.  Infections due to contamination.  Infra-red radiations.  Skin diseases [Chemical, Leather Processing Units].  Hearing impairment caused by noise.  Lung Cancer caused by asbestos dust.  Diseases due to effect of heat/cold in extreme hot/cold climate, etc. 20 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  21. 21. Compensation for What? Sec-4 Provides for Compensation for Death Permanent Total Temporary Partial Total Partial [or] Disablement Total Partial Permanent Temporary Permanent Temporary 21 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  22. 22. Compensation Compensation Factors considered for calculation / Depends on Death Disablement Permanent a)Nature of Injury Total Temporary Partial Total Partial [or] Total Partial Permanent Temporary Permanent Temporary b)Monthly Wages of Employee c)Relevant Factor No Distinction between Adult & Minor 22 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  23. 23. Amount of Compensation Compensation for Death Compensation for Disablement Permanent Disablement Total Partial [Injury listed in Part-II of Schedule-I] Temporary Total/Partial % of loss of 50% of M.W. X 60% of M.W. X R.F. earning capacity – R.F. [or] 1,20,000 [or] 1,40,000 whichever that [such] % of 25% of M.W. – compensation Payable every whichever is more. is more. payable in case of Half-Month. Permanent Total Disablement. Injury not listed in Schedule-I As in case of PTD-proportionate to loss of earning capacity [loss of earning capacity-assessed by qualified medical practitionerconsidering list of injuries listed in Schedule-I] 23 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  24. 24. Amount of Compensation Calculation of Compensation for Death 50 X (M.W) X (R.F.) 100 Formula or 1,20,000 whichever is more Employee Eg. M.W. (Rs.) Date of Death (By Accident) Date of Birth Rs.3,000 12/03/2000 14/07/1965 Completed Years of age on 14/07/1999 Relevant Factor for Age 34 Calculation ∴ the Compensation is 24 34 199.40 Amount of 50% of Rs.3,000 X 199.40 or 1,20,000 Compensation whichever is more 50 X 3000 X 199.40 Rs.2,99,100 100 Rs.2,99,100 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  25. 25. Amount of Compensation Calculation of Compensation for PTD 60 X (M.W) X (R.F.) 100 Formula or 1,40,000 whichever is more Employee Eg. M.W. (Rs.) Date of PTD (By Accident) Date of Birth Rs.3,000 12/03/2000 14/07/1965 Completed Years of age on 14/07/1999 Relevant Factor for Age 34 Calculation ∴ the Compensation is 25 34 199.40 Amount of 60% of Rs.3,000 X 199.40 or 1,40,000 Compensation whichever is more 60 X 3000 X 199.40 Rs.3,58,920 100 Rs.3,58,920 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  26. 26. Amount of Compensation Calculation of Compensation for PPD 60 X (M.W) X (R.F.) 100 Formula or 1,40,000 whichever is more Employee Eg. M.W. (Rs.) Date of PTD (By Accident) Date of Birth Rs.2,000 14/09/1999 01/08/1969 Completed Years of age on 01/08/1999 Relevant Factor for Age 30 Calculation ∴ the Compensation is 26 30 207.98 Amount of 60% of Rs.2,000 X 207.98 or 1,40,000 Compensation whichever is more 60% of 60 X 2000 X 207.98 Rs.1,49,746 100 Rs.1,49,746 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  27. 27. Compensation to be paid When due? If employer not accept the compensation to the extent claimed - Result Time Limit for Payment Should make provisional Within 1 month from payment to the extent he the due date. accepts. As soon as it falls due-i.e., Liability Payment should be deposited for payment of with Commissioner for compensation is Employees’ Compensation. fixed on employer. If not, Commissioner direct the employer to pay the arrears with simple interest rate of 12% or as prevailing in bank. Further delay-50% of Employee having right to make amount due will be any further claim. recovered as penalty. 27 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  28. 28. Review of Half-monthly Payment Half-monthly Payment may be Reviewed By On Application by Employer Commissioner or Employee Application must be accompanied by Certificate of Qualified Medical Practitioner that There has been change in condition of employee On review, the half-monthly payment may be Continued Increased Decreased Ended 28 Converted into a lump-sum Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  29. 29. Rules Regarding Distribution of Compensation 29 Rules with of Lump-sum Deposit Compensation due to an Commissioner Not valid employee/person under legal disability 1 Payment 2 Deceased Employee (Death of Employee) Employer may make advances Amount equal to 3 months payment directly wages of employee to dependant Pay compensation not less than ` 10 to employee [or] Adult Male Worker [Totally/Partially Disabled] Employer may either 4 Compensation amount deposited with Commissioner Employer - discharged from liability 5 Commissioner cause notice to Dependants to appear before him for be published/served on determining the distribution of compensation. 6 If Commissioner satisfied Repay the balance to employer. that no dependant exists 3 Deposit with commissioner Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry. If employer makes direct payment to dependants Compensation for Death &
  30. 30. Rules Regarding Distribution of Compensation Commissioner shall disbursement statement. furnish compensation 8 Apportionment of Compensation (by Commissioner) apportioned among dependants or any one of them in such proportion as he thinks fit. Commissioner may at his discretion allot compensation to any one dependant. 9 To Whom Compensation payable Person entitled 10 Lump-sum deposited with May be invested, applied or otherwise dealt with for Commissioner payable to woman benefit of woman or person under legal disability as or person under legal disability commissioner directed. 11 Commissioner may pay to dependant or any other Half-monthly payment payable person whom the commissioner thinks best fitted to to person under legal disability provide for the welfare of the employee. 12 Neglect of Children by parent/variation of circumstances Commissioner may vary earlier orders regarding of any dependant/other sufficient distribution/investment of compensation cause 13 If Commissioner vary orders as payment of compensation obtained by fraud or in point 12 by reason of the fact impersonation or other improper – it may be that recovered as arrear of land revenue. Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry. If applied by employer 7 30
  31. 31. Notice & Claim Notice Commissioner By Employee Manner Claim In Writing Time As soon as after happening of the accident Preferred before Within 2 years of Commissioner Occurrence of accident death Name &address (of person injured) Content cause of injury Date of accident Serving of Notice Employer/Any one of several employers /Any person responsible to employer for management of any branch of trade or business Mode of Serving Notice By delivery/regd.post The Commissioner may entertain & decide any claim (no notice or prefer claim) if he satisfied that even if there is failure to give notice or prefer claim Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry. To Whom 31
  32. 32. Fatal Accidents Sec-10-A [Power to require from employers statements regarding Fatal Accidents] 32 Sec-10-B [Report of Fatal Accidents & Serious Bodily Injuries] To By Regd. Post Require employer To Submit statement stating Time circumstance leading to death of Limit employee Format Prescribed Form Time Limit Within 30 days of service of notice liable or Not liable Commissioner 7 days accident Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry. Employer required to give Commissioner receives from any source regarding notice about accident in his resulting in fatal accident of an employee, send notice to premises death/serious bodily injury employer send report of This section – not apply to Further indication To deposit compensation on factories to which ESI Act, to be made by account of death 1948 applies. employer in the Statement whether Deposit within Indicate for in his opinion, he is 30 days of ground notice disclaimer
  33. 33. Medical Examination & Its Rules 33 In certain cases of accidents, an employees has to be medically examined to entitle to claim compensation Employee To Whom Employer Time limit – employer arrange for Before expiry of 3 days from the date of service Medical Examination of notice Cost of Medical Examination Free of Charge Medical Examination by Qualified Medical Practitioner If employee refuse/obstruct for Medical Right to compensation Examination refusal/obstruction –suspended till Right to compensation – suspended till he & offers himself for Medical Examination Employee voluntarily leaves without returns examined Employee refused Medical Examination Commissioner may, if thinks fit, direct the & subsequently dies payment of compensation If right to compensation is suspended No compensation for suspended period. If injury of an employee aggravated due Entitled to compensation only for the normal to his refusal for Medical injury & not for aggravated injury. Examination/follow instructions Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry. Notice of accident by
  34. 34. Compensation – First Charge on Assets Claim for compensation – Preferential Debt. Employer may attempt to transfer his immovable assets before discharging his liability to pay compensation which accrued before the date of transfer Compensation to be first charge on Sec.14-A creates first charge on assets transferred by employer immovable assets transferred by the employer in respect of compensation payable by him under the E.C. Act provided the liability for the compensation accrued before the date of transfer. 34 Date of Transfer of Assets 01-02-2013 Eg. Date of Liability accrued 10-02-2013 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  35. 35. References  Elements of Industrial Law – N.D.Kapoor  PPTs of Hari Parmeshwar Ranjeet Kumar Yadav AFTERSCHO☻OL 35 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.
  36. 36. THANK YOU 36 Dr.K.Padmanabhan, Assistant Professor, BGCW, Puducherry.

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