The Employee’s

Compensation Act, 1923

 Introduction
● Among the welfare legislation’s protecting the interests of the employees employed in industrial
establishments, the Employees Compensation Act, 1923 is of great importance. It is an important social
Security legislation designed to effectuate the principle of social justice.
● The universal declaration of Human Rights also proclaims the importance of social Security and
assistance.
● The Workmen's Compensation Act was passed during British period in pursuance of the recommendations
of the Royal Commission on Labour. It came into force from July 1, 1924. It has been amended several
times so as to meet the needs in consonance with the changing conditions. The Act was amended firstly in
1933 by the Workmen's Compensation (Amendment) Act, 1933, Secondly in 1938 by the Workmen's
Compensation Act, 1938; thirdly in 1938 by the Workmen's Compensation (Amendment) Act, 1938;
fourthly in 1946 by the Workmen's Compensation (Amendment) Act, 1946; fifthly in 1959 by Workmen's
Compensation Act, 1959 and in 1962 by the Workmen's Compensation (Amendment) Act, 1962 and again
in 1984 by the Workmen's Compensation (Amendment) Act, 1984.
Extent and applicability: The Act is now, extends to the whole of India including the State of Jammu and
Kashmir.

Object: The Act was framed with a view to provide for compensation to a employee incapacitated by an
injury from accident. But compensation is not the only benefit flowing from the Act; it has important effect
in furthering work on prevention of accidents, in giving employees greater freedom from anxiety and in
rendering industry more attractive. The growing complexity of industry with the increasing use of machinery
and consequent danger to the employees along with comparative poverty of the employees themselves
renders it advisable that they should be protected, as far as possible, from hardship arising from accidents.
Further, the main object of the Act is to impose legal obligation on the employers to pay compensation to
employees involved in accidents while working in the premises.
 Scheme of the Act

At the Time of passing of the Act At the Present

● Contains 36 sections divided into 4 chapters ● 43 sections divided into into 4 chapters and
and 4 schedules 4 schedules
 Conditions for payment of Compensation under the Act
In order to claim compensation under the Employee's compensation Act, the following conditions are to be satisfied,-

● (a) personal injury must have been caused to the employee;

● (b) the injury must have resulted in the employee's death or permanent or temporary, total or partial disablement;
● (c) the injury must have been caused by accident;
● (d) the accident must have arisen out of the employee's employment;
● (e) the accident must have occurred in the course of the employee's employment;
● (f) the formalities prescribed by the Act must have been observed for the claim of compensation;
● (g) the case must not fall under any of the exceptions to the proviso to Section 3(1);
● (h) there must be some claimant who is entitled to compensation under this Act;
● (i) the accident must have happened in India except in the case of Mastership and Seamen;
● (j) the person from whom the compensation is claimed must be one of the persons liable to pay compensation under the Act;
● (k) the compensation must be calculated in accordance with the provision of the Act; and
● (l) The Employee must not have filed a suit for damages against any person in civil court in respect of the same injury
Definitions - Section 2
(i) Commissioner: 2(1) (b) The term Commissioner means a Commissioner of Employee's
Compensation appointed under Section 20 of the Act. A Civil Court has no jurisdiction to decide or deal
with any question which because of the provisions of the Act, is required to be decided or dealt with by
the Commissioner or to enforce any liability under the Act.

(ii) Dependent: Section 2 (1) (d) of the Act defines dependant. Under this sub-Section relations of an
employee are divided into three classes. However, there is no preferential right amongst dependants to
maintain claim application. The dependants are not classified in different categories in the sense that
those specified in Category I will exclude others. Dependants belonging to any category by claim
simultaneously.

(A) The first category includes a widow, a minor legitimate or adopted son, an unmarried legitimate or
adopted daughter and a widowed mother. They are deemed in law as dependants of a employee whether
they are in fact dependant on the earnings of the employee or not.
B) In the Second category of dependants are included a soil and a daughter, they have to fulfil the following conditions, namely:

● (a) They must be wholly dependant on the earnings of the Employee at the time of his death;
● b) They must be infirm; and
● (c) They must have attained the age of 18 years.

(C) The following are included in the third category of dependants provided they are wholly or in part dependant on the earnings of the workman at the time
of his death;

● (a) a widower,
● (b) a parent other than a widowed mother,
● (c) (i) a minor illegitimate son,
● (ii) an unmarried illegitimate daughter,
● (iii) a daughter whether legitimate or illegitimate or adopted if married and minor, or if widowed and a minor,
● (d) a minor brother or an unmarried sister or a widowed sister if a minor,
● (e) a widowed daughter-in-law,
● (f) a minor child of a predeceased son,
● (g) a minor child of a predeceased daughter where no parent of the child is alive, or
● (h) a paternal grandparent if no parent of workman is alive.
iii) Employer: sec 2 (1)(e) The term 'Employer includes the following persons : ' as defined in the Act

(a) any body of persons whether incorporated or not;

(b) any managing agent of the employer ;

(c) legal representatives of the deceased employer ; and

(d) when the services of the employee are temporarily lent or let on hire to another person by the person with whom the Employee has entered into
contract of service of apprenticeship, means such other person while the employee is working for him.

(iv) Employee - find the definition Sec 2(1)(n)

(V) Widow: A widow who is entitled to claim compensation the time of death of her husband is not disentitled by her subsequent marriage. The Act
takes into consideration only those situations and facts that are in existence at the time of death of an employee. subsequent events do not affect the
right of a dependant under the Act. Section 8 (5) of the Act also supports the above view. The question of chastity or unchastity is not allowed to be
raised to defeat any claim of the widow to compensation under the Act.
vii) Unmarried Legitimate Daughter: The expression unmarried daughter' includes a
widowed daughter, who is being maintained by her father during his life time. A daughter
undoubtedly acquires a new relationship on marriage but she does not lose the ald
relationship; she remains a daughter. Once a daughter always daughter qua relationship she
is daughter before, during and after marriage

Wages: The term "wages" as defined in Section 2 (1)m) includes any privilege or benefit
which is capable of being estimated in money. The definition is not exhaustive. The
following are not wages:

Travelling allowance or the value of any traveling concession,

● (a) Any pension

● (b) Any Provident fund
 Employer's liability to pay compensation (Sec 3)

As per Section 3(1) of the act, the following conditions must necessarily be
satisfied in order to qualify for compensation:
1. He must be a workmen within the meaning of this act.
2. Personal injury must have been caused by accident.
3. The injury must have been caused by accident.
4. The accident must have arisen out of and in the course of employment.
5. The injury caused by the accident must have resulted in the workman's death or
permanent total disablement or temporary