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Employee'S Compensation Act 1923: Disablement and Amount of Compensation Payable

The Employees Compensation Act of 1923 extends to all of India and imposes liability on employers to provide compensation to employees who are disabled or contract diseases during the course of their employment in hazardous working conditions. The Act aims to provide quick resolution of compensation disputes outside of civil court proceedings. It applies to industries like mines, factories, transport, construction, etc. The Act defines partial and total temporary or permanent disablement and provides a framework for calculating compensation amounts based on percentages of monthly wages for death, permanent or temporary disablement, or injuries listed in schedules to the Act. Case laws have interpreted aspects of calculating compensation under the Act.

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301 views

Employee'S Compensation Act 1923: Disablement and Amount of Compensation Payable

The Employees Compensation Act of 1923 extends to all of India and imposes liability on employers to provide compensation to employees who are disabled or contract diseases during the course of their employment in hazardous working conditions. The Act aims to provide quick resolution of compensation disputes outside of civil court proceedings. It applies to industries like mines, factories, transport, construction, etc. The Act defines partial and total temporary or permanent disablement and provides a framework for calculating compensation amounts based on percentages of monthly wages for death, permanent or temporary disablement, or injuries listed in schedules to the Act. Case laws have interpreted aspects of calculating compensation under the Act.

Uploaded by

Vineet Malpani
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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EMPLOYEE’S COMPENSATION ACT

1923

DISABLEMENT AND AMOUNT OF COMPENSATION PAYABLE

BY
VINEET MALPANI
LLB Sem VI
OBJECT AND SCOPE
 The Employees Compensation Act, 1923 extends to the whole of
India.
 It came into force on the first day of July, 1924. It is social security
legislation.
 The Employees Compensation Act, 1923 imposes statutory liability
upon an employer to discharge his moral obligation towards
employees when they suffer from any physical disabilities or
diseases, during the course of employment in hazardous working
conditions.
 The aim of the Act is to provide quick and cheaper disposal of
disputes relating to the compensation which is not possible in
comparison in case of proceedings of civil law. The Act also helps the
dependants to get relieved from the hardship, rising from accident.
APPLICABILITY OF THE ACT
 Applicable to: -
 Mines
 Factories
 Plantations
 Transport Establishments
 Construction Works
 Railways
 Ships & Circuses
 Not applicable to: -
 Members of armed forces of union
 Employees covered by ESI Act, 1948. (Dependent‟s benefits available)
 Casual Workers & workers employed otherwise than for employer‟s
trade or business.
DISABLEMENT
 The Act does not define the word disablement.
 But it defines the partial and total disablement.
 (i) “Partial disablement” means,
A. where the disablement is of a temporary in nature, such disablement as reduces the
earning capacity of a workman in any employment in which he was engaged at the
time of the accident resulting in the disablement, and
B. where the disablement is of a permanent nature, such disablement as reduces his
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 shall be deemed to
result in permanent partial disablement.
 In case of temporary partial disablement, the disablement results in reduction of
earning capacity in respect of only that employment in which he was engaged at the
time of accident. This means the workman‟s earning capacity in relation to other
employment is not affected. But in case of permanent partial disablement, the
disablement results in reduction in his earning capacity is not only the employment in
which he was engaged at the time of accident but in all other employment.
DISABLEMENT (CONT.)
“Total disablement” means such disablement, whether of a temporary
(ii)
or permanent nature, as incapacitates a workman for all work which he was
capable of performing at the time of the accident resulting in such
disablement. Provided that permanent total disablement shall be deemed to
result from every injury specified in Part I of Schedule I or from any
combination of injuries specified in Part II thereof where the aggregate
percentage of the loss of earning capacity, as specified in the said Part II
against those injuries, amounts to one hundred per cent or more.
COMPENSATION PAYABLE
 Sec-4 Provides for Compensation for:
 Death

 Permanent Total Disablement


 Permanent Partial Disablement

 Temporary Partial Disablement


 Temporary Total Disablement
AMOUNT OF COMPENSATION
 Section 4
 Where death of a workman results from the injury:

An amount equal to 50% of the monthly wages of the


deceased workman multiplied by the relevant factor or an
amount of, Rs. 1,20,000 whichever is more.
 Where permanent total disablement results from the
injury:
An amount equal to 60% of the monthly wages of the
injured workman multiplied by the relevant factor or an
amount of Rs. 1,40,000, whichever is more.
AMOUNT OF COMPENSATION
 Where permanent partial disablement results from the
injury (injury listed in part II of schedule I):
% of loss of earning capacity that such % of compensation
payable.
 Where temporary total/ partial disablement of a workman
results from the injury:
An amount equal to 25% of the monthly wages payable
every half-month
CASE LAWS
 Calcutta Electric Supply Corp. v. HC Das 1968 2 LLJ 169
No compensation is granted for any physical incapacity unless there was loss of
earning capacity. It is solely within the case of scheduled injury that such loss is
presumed. Wherever the injury is not scheduled injury, the loss of earning capacity
must be proved.
 Amar Nath Singh v. Continental Constructions Ltd 2002 SSC (L&S) 1040
Here the appellant lost his left eye and created claim as having lost his complete
vision in that eye but medically it was assessed that loss of vision was only 80%.
The Commissioner assessed the compensation collectable to him as 100 percent
beneath Schedule I, Part I Item 4. The tribunal reduced it to 30% relying upon the
provisions under Item twenty six of Part II Schedule I.
THANK YOU

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