The Employees Compensation Act, 1923 – Brief Notes

The Employees Compensation Act, 1923 provides social security to the employees who have had an accident during the course of employment which either leads to their Partial or Total Disablement in hazardous working conditions. In the case of the accident resulting in the death of the employee, the compensation is payable to the dependants of the employee. There are two types of Disablement-

a) Partial Disablement

Which can be further classified as

  • ‘Temporary Partial Disablement’-: Where the disablement reduces the earning capacity of the employee in the employment he was engaged in during the time of the accident
  • ‘Total Partial Disablement’-: Where the disablement reduces for all time the earning capacity of the employee in every employment which he was capable of undertaking at the time

[Suggested Read: Objectives of Legal Aid in India]

b) Total Disablement: Where the Disablement incapacitates the employee of all work that he capable of performing at the time of the accident.

  • This Act provides compensation by an employer for all physical injury arising during employment which causes disablement and for an occupational disease that is bound to be acquired due to the nature of work.
  • The employer is not liable to pay any compensation if disablement due to injury doesn't last more than three days or injury is caused directly due to the worker being drunk or on drugs at the time, worker disobeyed a safety rule or order, and removed or disregarded any safety guard.
  • The compensation is calculated by considering factors like the nature of injury or disability, the average salary and age of the injured employee.
  • The claim for compensation must be made within an appropriate period by giving notice of the accident to the employer, the agreement over compensation must be reached without fraud or undue influence, and compensation is to be paid immediately.
  • After the employee and employer have reached an agreement over the amount of settlement to be paid, the agreement needs to be registered with the commissioner and is to be verified and recorded.