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Monday, 3 January 2011

Workmen’s Compensation Act, 1923 (India)

The Workmen's Compensation Act, 1923 is one of the important social security legislations. It aims at providing financial protection to workmen and their dependents in case of accidental injury by means of payment of compensation by the employers.
This Act makes it obligatory for the employers brought within the ambit of the Act to furnish to the State Governments / Union Territory Administrations annual returns containing statistics relating to the average number of workers covered under the Act, number of compensated accidents and the amount of compensation paid.
The important terms in the Workmen Compensation Act 1923 are as below:
a)    Dependents Dependent means

·      a widow, a minor son, unmarried daughter or a widowed mother, and
·      if wholly or in part dependent on the earnings of the worker at the time of his or her death’ 
i)       a widower, a minor brother and unmarried sister
ii)      a widowed daughter–in– law and
iii)     a minor child of predeceased daughter, etc.
b)  Minor:  A person below 18 years of age.
c)  Partial Disablement:  means disablement of temporary nature and which reduces the earning capacity of a workman.
d) Total Disablement:  implies such disablement which (temporarily or permanently) incapacitates a workman for all work and he cannot earn at all (for a period or for ever).
e) Workman:  means a person (other than one whose employment is of casual nature and who is employed otherwise than for the purpose of the employer’s trade or business)
Applicability of the Act
The Act extends to the whole of India except the States/Union Territories.
The Act applies to workers employed in any capacity specified in Schedule II of the Act which includes Factories, Mines, Plantations, Mechanically Propelled Vehicles, Construction Work and certain other Hazardous Occupations and specified categories of Railway Servants.
Main Provisions and Scope of the Act
Under the Act, the State Governments are empowered to appoint Commissioners for Workmen's Compensation for:
i)     Settlement of disputed claims,
ii)    Disposal of cases of injuries involving death, and
iii)   Revision of periodical payments. Sub-section (3) of Section 2 of the Act, empowers the State Governments to extend the scope of the Act to any class of persons whose occupations are considered hazardous after giving three months notice to be published in the Official Gazette. Similarly, under Section 3(3) of the Act, the State Governments are also empowered to add any other disease to the list mentioned in Parts A and B of Schedule – II and the Central Government in case of employment specified in Part C of Schedule III of the Act.
In case of death the minimum amount of compensation fixed is Rs. 80,000 and Rs. 90,000 in case of permanent total disablement. The existing wage ceiling for computation of maximum amount of compensation is Rs. 4000. The maximum amount of compensation payable is Rs. 4.56 lakh in the case of death and Rs. 5.48 lakh in the case of permanent total disablement.