EMPLOYER'S LIABILITY FOR OCCUPATIONAL DISEASE-AN OVERVIEW

A Final Draft submitted in partial fulfilment of the course Labour Law- II, 5th SEMESTER
during the Academic Year 2018-2019

SUBMITTED BY:

ANUPAMA SOUMYA

Roll No. - 1613

B.B.A LL.B

SUBMITTED TO:

MS.PALLAVI SHANKAR

FACULTY OF LABOUR LAW II

SEPTEMBER, 2018

CHANAKYA NATIONAL LAW UNIVERSITY, NAYAYA NAGAR, MEETHAPUR, PATNA-

800001

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 DECLARATION BY THE CANDIDATE

I hereby declare that the work reported in the BB.A. LL.B (Hons.) Project Report entitled “Employer's
Liability For Occupational Disease-An Overview” submitted at Chanakya National Law
University, Patna is an authentic record of my work carried out under the supervision of Ms.Pallavi
Shankar.

I have not submitted this work elsewhere for any other degree or diploma. I am fully responsible for
the contents of my Project Report.

(Signature of the Candidate)

ANUPAMA SOUMYA

Chanakya National Law University, Patna

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 ACKNOWLEDGEMENT

A project is a joint endeavor which is to be accomplished with utmost compassion, diligence and with
support of all. I am overwhelmed in all humbleness and gratefulness to acknowledge from the bottom of
my heart to all those who have helped me to put these ideas, well above the level of simplicity and into
something concrete effectively and moreover on time.
This project would not have been completed without combined effort of my teacher Ms.Pallavi Shankar
whose support and guidance was the driving force to successfully complete this project. I express my
heartfelt gratitude to him.

I owe the present accomplishment of my project to my friends, who helped me immensely with sources
of research materials throughout the project and without whom I couldn’t have completed it in the
present way.

I would also like to extend my gratitude to my parents and all those unseen hands who helped me out at
every stage of my project.

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AIMS AND OBJECTIVES

The Aims and Objectives of this project are:

1. To know about occupational diseases.

2. To study the liabilty of employer unde EC act and ESI act.
3. To study the barriers in getting compensation.

HYPOTHESES

The researcher considers the following hypothesis:

Under the law of workers' compensation in many jurisdictions, there is a presumption that specific
disease are caused by the worker being in the work environment and the burden is on the employer or
insurer to show that the disease came about from another cause.

The liability of employer is very confined and not all occupational diseases are covered under scope of
compensation.

RESEARCH METHODOLOGY

For this study, doctrinal research method was utilised. Various articles, e-articles, reports and books
from library were used extensively in framing all the data and figures in appropriate form, essential for
this study.

The method used in writing this research is primarily analytical.

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 TABLE OF CONTENTS

Declaration

Acknowledgement

Research Methodology

Chapter1:INTRODUCTION
Chapter 2: BACKGROUND(EMPLOYEES COMPENATION ACT)

Chapter 3: CLAIM OF COMPENSATION UNDER EC ACT

-Scope of section 3
-Employer’s Liability To Pay Compensation

Chapter 4: INSURANCE AND COMPENSATION LAWS(ESI ACT)

-Benefits covered under this act

Chapter 5: BARRIERS IN GETTING COMPENSATION

CONCLUSION & SUGGESTIONS

BIBLIOGRAHY

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 CHAPTER 1: INTRODUCTION

Legal framework of Occupational Safety and Health At present, safety and health statutes regulating the
occupational safety and health (OSH) of persons at work exist only in four sectors, namely mining,
factories, ports, and construction. A number of OSH laws and regulations are applicable in a
fragmented manner and the regulations have very specific objectives, covering the problems of safety
and health to a limited extent.

The Indian Factories Act of 1948 provides for the health, safety and welfare of the workers in the
manufacturing sector. The Shops and Commercial Establishment Act regulates the conditions of work
and terms of employment of workers engaged in shops, commercial establishments, theatres,
restaurants, etc.

The Employee’s Compensation Act, 1923 (previously Workmen’s Compensation Act), provides for
compensation to injured workmen of certain categories and in the case of fatal accidents to their
dependants if the accidents arose out of and in the course of their employment. It also provides for
payment of compensation in the case of certain occupational diseases.

The Employees’ State Insurance Act, 1948, provides for sickness benefit, maternity benefit,
disablement benefit and medical benefit.

Role of government agencies

Several governmental agencies and committees have been formed over the years to ensure research on
occupational health and to improve upon the existing legal framework so as to include modern day
realities.

NIOH - NIOH started as “Occupational Health Research Institute” (OHRI) in the year 1966 and was
re-christened as “National Institute of Occupational Health” (NIOH) in 1970 and is currently located in
Ahmedabad.

The major objectives of the Institute and its centers are to identify and mitigate the occupational and
environmental health problems in the country. NIOH has carried out research work on many
occupational diseases and has also developed preventive intervention and control measures, which are

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economical and locally available. Some of the examples are the control of silicosis in unorganized
sectors such as agate polishing, quartz crushing, stone quarrying among other, and green tobacco
sickness in tobacco harvesters.

Labour Commission - The first National Labour Commission in 1929, had promised much in the
direction of social security, social welfare, wages, social insurance, industrial relations, industrial
adjudication and collective bargaining. Several recommendations made in the report of the first national
commission on labour were made part of labour legislations. After a gap of almost 72 years, the Second
National Labour Commission was constituted which submitted its report in the year 2002 to the federal
Government of India.

The commission was required to -

1. To suggest rationalisation of existing laws relating to labour in the organised sector; and

2. To suggest umbrella legislation to ensure a minimum level of protection for workers in the
unorganised sector.

The commission made the following important recommendations.

1. The system of legal aid to workers and trade unions from Public Fund worked out to ensure
that workers and their organisations are not unduly handicapped as a result of their inability to
hire legal counsel.

2. There should be reduced working hours for adolescents, prohibition of underground work in
mines for women workers, prohibition of work by women workers between certain hours and so
on. 3. No exemptions for areas such as export processing zones (EPZ) or special economic
zones (SEZ) from the labour laws.

4. The Workmen’s Compensation Act should be converted from an employers’ liability scheme
to a social insurance scheme, its coverage should be progressively extended to more types of
employment and classes of employees, and the restrictive clauses in Schedule II of the act
should be removed.

5. The commission would recommend that no worker should be kept continuously as a casual
or temporary worker against a permanent job for more than two years.

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No matter which act governs the health, safety and welfare features for workers employed in different
occupations, there are two (2) laws under which compensation can be claimed, namely the Employees
Compensation (EC) Act, 1923 (earlier Workmen’s Compensation Act) and Employee State Insurance
(ESI) Act, 1948.

Any worker who is governed by the ESI Act can claim compensation under the ESI Act. All other
workers need to claim compensation under the EC Act. Under Building and Other construction workers
Act, a worker can claim compensation according to Employee compensation Act as per Section 45 (2).

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 Chapter 2: BACKGROUND (EMPLOYEES COMPENATION ACT)

The Workmen’s Compensation Act is the first piece of legislation towards social security. It deals with
compensation for employees who are injured in the course of duty. The scheme of the Workmen’s
Compensation Act is not to compensate the employee in lieu of wages. The general principle is that a
employee who suffers an injury in the course of his employment, which results in a disablement, should
be entitled to compensation and in the case of a fatal injury his dependants should be compensated.
Under the Workmen’s Compensation Act it is the employer who is responsible to pay compensation (as
opposed to the employees State insurance. Establishments to which the Employees’ State Insurance Act
applies to the liability to pay compensation are on the ESI Corporation).

The Workmen’s Compensation Act, 1923 provides for payment of compensation to employee and their
dependants in case of injury and accident (including certain occupational disease) arising out of and in
the course of employment and resulting in disablement or death. The amount of compensation to be
paid depends on the nature of the injury and the average monthly wages and age of employee. The
minimum and maximum rates of compensation payable for death (in such cases it is paid to the
dependents of employee) and for disability have been fixed and is subject to revision from time to time.

The meaning of compensation in this Act is limited to compensation granted under the Act for
employment injuries sustained during the course of work. It is also limited to specifically monetary
compensation other than a salary, travel allowance, and any other form of remuneration that could be
paid under normal circumstances of employment.

To get an overall understanding of the Act it is useful to look at the “Statement of Objects and Reasons’
published with the Act when it was first passed in 1923. To quote: “ …the growing complexity of
industry in this country with the increasing use of the machinery and consequent danger to employee,
along with the comparative poverty to employee themselves renders it advisable that they should be
protected, as far as possible from hardship arising out of accidents.

An additional advantage of a legislation of this type is that by increasing the importance for employers
of adequate safety devises, it reduces the number of accidents to employees in a manner that cannot be
achieved by official inspection. Further, the encouragement given to employers to provide adequate
medical treatment for their employees should mitigate the effects of such accidents as does occur. The
benefits so conferred added to the increased sense of security, which he will enjoy, should render
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industrial life more attractive and thus increase the available supply of labour. At the same time a
corresponding increase in the efficiency of the average employees may be expected.”

While these were the official objects and reason, Indian reality today, is that the protection offered by
the Act does not act as an incentive for employees, most of whom are unaware of it and who simply
join work to earn a livelihood.

At the time the framing of the bill two criteria were followed in determining whom the Act would apply
to:

1. Those industries which were more or less organized

2. Employee whose occupations were hazardous.

Nowadays the government (State of Central) may extend the application of this Act to other
establishments of an industry that may not be organised.

It is obligatory for the employers to pay compensation to their employees for injury caused to a
employee by accident, arising out of and in the course of employment, resulting in death or in
total/partial disablement under the Workmen’s Compensation Act. Compensation is also payable for
some occupational diseases contracted by employees during the course of their employment.

In the year 2010 the Act had been amended to make it gender neutral and will now be called “the
Employees’ Compensation Act, 1923”.

OBJECT

 Provide employees and/or their dependents some relief or to consider compensation payable by
an employer to his employee in case of accidents arising out of and in the course of employment
and causing either death or disablement of employee as a measure of relief and social security.

 Provide for payment by certain classes of employers to their employees compensation for injury
by accident.

 To enable an employee to get compensation irrespective of his negligence.

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  It lays down the various amounts payable in case of an accident, depending upon the type and
extent of injury. The employer now knows the amount of compensation he has to pay and is
saved of many uncertainties to which he was subject before the Act came into force.

FEATURES

 Act provides for cheaper and quicker mode of disposal of disputes through special proceedings
than possible under Civil Laws.

 Act provides compensation to employees for injury caused by accident and occupational disease
arising out of and in the course of employment.

 The Act is applicable to apprentices also.

 Procedure for settlement of claim is through Commissioners.

APPLICABILITY

The Act extends to the whole of India and applies to certain categories of railway servants and
employees employed in any capacity specified in Schedule II of the Act which includes Factories,
Mines, and Plantations, Mechanically Propelled Vehicle, Construction Work and certain other
hazardous occupations.

Every employee including those employed through a contractor who is engaged for the purposes of
employer’s business and who suffers an injury in any accident rising out of and in the course of his
employment, shall be entitled for compensation under this Act.

The Act does not, however, apply to –

(i) Persons whose employment is of a casual nature and who are employed for purposes other than the
employers’ trade or business;
(ii) Persons serving in Armed Forces and
(iii) Employees covered by the Employees’ State Insurance Act.
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Under Section 3(3) of the Act, the State Governments are empowered to extend the scope of the Act to
any class of persons whose occupations are considered hazardous after giving three months notice in the
Official Gazette.

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 Chapter 3: CLAIM OF COMPENSATION UNDER EC ACT

This is an act to provide for the compensation payment by certain classes of employers to their
employees in the event of an injury from a work-related accident.

Section 3:- this section deals with the compensation to be provided in case of injury or accident to a
workman during the course of employment. This section enables workers suffering from occupational
diseases to receive compensation. Schedule II of the act details the eligible persons which includes
persons employed in factories, construction works and other hazardous occupations. According to the
Act, the occupational disease should be contracted while in the service of the employer in the specified
employment. Schedule III of the Act divides occupational diseases into three categories, Part A, Part B,
and Part C.1

For diseases specified in Part A there is no qualifying period of employment. For diseases specified in
Part B a person should have been employed in the specified employment for a continuous period of six
months before the disease is contracted. For the diseases specified in part C, the qualifying period is
specified by the Federal Government.

Amount of Compensation (Section 4)

1. Where death results from the injury – An amount equal to fifty per cent of the monthly wages
of the deceased multiplied by the relevant factor or an amount of Rs. 120,000 whichever is more
.

2. Where permanent total disablement results from the injury – an amount equal to sixty per cent
of the monthly wages of the injured employee multiplied by the relevant factor or an amount of
Rs. 140,000 whichever is more The relevant factor in relation to an employee means the factor
specified in the second column of Schedule IV against the entry in the first column of the
schedule specifying the number of years which are the same as the completed years of the age of
the employee on his last birthday immediately preceding the date on which the compensation
fell due.

3. Where permanent partial disablement result from the injury

1
http://www.oehni.in/esiocc
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 a. In the case of an injury specified in Part II of schedule I2, such percentage of the
compensation which would have been payable in the case of permanent total disablement as is
specified therein as being the percentage of the loss of earning capacity caused by the injury.

b. In the case of an injury not specified in the schedule I, such percentage of the compensation
payable in the case of permanent total disablement as is proportionate to the loss of earning
capacity (as assessed by the qualified medical practitioner) permanently caused by the injury.

4. Where temporary disablement, whether total or partial, results from the injury – a half
monthly payment of the sum equivalent to twenty five percent of monthly wages of the
employee to be paid in accordance with the provisions of the sub section (2).

Other Important Provisions of the Act

The Act mandates that the notice of an accident is required to be given by an employee to the
Commissioner, within a period of two years from the date of such accident. In cases where such
accident is the of a disease, the accident shall be deemed to have occurred on the first of the
days during which the employee was continuously absent from work due to disablement caused
by the disease16. The Act further provides for a medical examination of an employee free of
charge by a medicinal practitioner where a notice of the accident has been received by an
employer. The Commissioner has to dispose of the compensation cases within a period of three
months. 3

Steps in Claiming Compensation under the WC Act 1923

1. You can claim compensation under WC Act 1923 if a. You are not covered under ESI Act b.
If you have not filed a claim for compensation in a civil court

2. Keep record of accident along with a. Report to the employer b. Papers of treatment c. Report
to the police if any

3. Get your disablement assessed by a qualified medical practitioner. All MBBS (Bachelor of
Medicine and Bachelor of Surgery) doctors with legitimate registration numbers are qualified
medical practitioners under this Act
2
Schedule I lists of Injuries deemed to result in Permanent total and Partial disablement [Section 2 and Section 4 of
Employees Compensation Act]
3
Diseases due to Work and Compensation – PRIA
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 4. In case of diseases due to work specified under schedule III of the Act, you should get it
diagnosed and assessed by any qualified medical practitioner

5. Give notice of accident and permanent disablement within two years after the accident – (See
sample notice form/format in Annexure)

6. If the employer asks you to be checked by a qualified medical practitioner then he has to (a)
pay all the charges and (b) get the medical check-up done within 72 hours of receiving the
notice

7. In case of death, the above procedure has to be carried out by the dependents .

8. In the court, you have to file your claim in the specified format

9. The court will issue an order obligating the employer to pay compensation or otherwise after
discussions, arguments and cross questioning.

10. You need to serve copy of the order of the court to the employer to get compensation.

EMPLOYER’S LIABILITY TO PAY COMPENSATION

In case a personal injury is caused to a employee by accident arising out of and in the course of his
employment, his employer is liable to pay compensation in accordance with the provision of the Act
within 30 days from the date when it fell due otherwise he would also be liable to pay interest and
penalty.
As per Section 3 (1) of the Act, the employer is liable to pay compensation if the employee is injured
by accident -
 that arises out of (i.e. while engaged in work), and;
 in the course of his employment (i.e. during work hours),and;
 Such an injury results in temporary or permanent disablement of the employee.

It may also include an occupational disease. But consumption of alcohol in heavy quantity by the
workman, while taking rest or sleeping during night time, can in no way be termed as an injury because
of an accident arising out of employment.4

4
ShriSankarKal, Vs.Sri Sunil Kumar Saha (2012)IV LLJ629

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In India News Chronicle Ltd v Luis Lazarus5 where a workman was under duty to go to heating room
and from there to a cooling room frequently where the temperature was kept low. While on duty the
workman went to the cooling room and thereafter fell ill and subsequently died of pneumonia. The
Court held that the ‘injury’ in Section 3 of the Workmen’s Compensation Act does not mean mere
physical but may include a strain which causes a chill. The death of the workman was due to personal
injury.

5
AIR 1951 Punj. 102
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The language in Section 3 shows that injury is caused by accident and not ‘by an accident’.
So the injury should be caused by accident by some mishap, unexpected or unforeseen.

Personal Injury:

 Not defined but not confined to physical injury but it may include a mental strain or
mental imbalance. Includes sun stroke, nervous collapse ,traumatic neuorisis,
hysterical paralysis and neurasthenia.

 In Indian News Chronicle Ltd vs Luis Lazarus an electrician had to frequently go to a

heating room and thereafter a cooling room fell ill and contracted pneumonia and
died. Injury may include a strain.

 There must be a causal link between the employment and the injury.

Accident:

 Means some unexpected event happening without design i.e. an unlooked or mishap
or untoward event.

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  It includes not only such occurrences such as collision, tripping, falls of roofs but also
less obvious ones causing injury e.g. strain which causes rupture , exposure to a
draught causing chill, shock causing neurasthenia.

Out of and In The Course of Employment:

 Out of employment i.e.…..due to
 In the course i.e.….. during
 To and fro to employment considered as “notional extension of employment” and so
far mostly compensation has been given by courts because it is perceived as socially
beneficial.

According to Section 3 (2) the employer’s liability for occupational disease arises under three
circumstances:
 If an employee, employed in any employment specified in Part A of Schedule III
contracts any occupational disease peculiar to that employment, or
 If an employee, who has been employed for a continuous period of not less than six
months in any employment specified in Part B of Schedule III contracts any
occupational disease peculiar to that employment, or
 If an employee, whilst in the service of one or more employers, in respect of any
employment specified in Part C of Schedule III contracts any occupational disease
peculiar to that employment
-the contracting of the disease shall be deemed to be an injury by accident within the meaning
of this section and, the contrary is proved, the accident shall be deemed to have arisen out of,
and in the course of, the employment.

WHEN EMPLOYER’S LIABILITY DOES NOT ARISE

In case the disablement of employee is three or less days; except in case of death when the
injury is caused due to influence of drink or drug taken by the employee or upon his wilful
disobedience to obey safety rules or removal of safety guards by him.

As per Section 3 (1) (a) any injury which does not result in the total or partial disablement of
the employee for a period exceeding 3 days subsequent to the accident.

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Section 3 (1) (b) any injury not resulting in death or permanent total disablement caused by
an accident which is directly attributable to -
 the employee having been at the time thereof under the influence of drinks or drugs,
or
 Wilful disobedience of the employee to an order expressly given, or to a rule
expressly framed, for the purpose of securing the safety of the employees, or
 Wilful removal or disregard by the employee of any safety guard or other device
which he knew to have been provided for the purpose of securing the safety of the
employees.

Section 3 (4) states that save as provide by Section 3 sub-sections (2), (2A) and (3), no
compensation shall be payable to an employee in respect of any disease unless the disease is
directly attributable to a specific injury by accident arising out of and in the course of his
employment.

Section 3 (5) nothing herein contained shall be deemed to confer any right to compensation
on an employee in respect of any injury if he has instituted in a Civil Court a suit for damages
in respect of the injury against the employer or any other person; and no suit for damages
shall be maintainable by an employee in any Court of law in respect of any injury –
a) If he has instituted a claim to compensation in respect of the injury before a
Commissioner; or
b) If an agreement has been come to between the employee and his employer providing
for the payment of compensation in respect of the injury in accordance with the
provisions of this Act.

Case laws:
Divisional Personal Officer, Southern Railway v Kartiyani6

There was a polluted water body at the place of employment as a result of which the
employees drinking the same died. Kerala High Court held it to be a personal injury
and made the employer liable on the ground that it was a part of duty of employer to

6
(1994) 3 LLJ Supp 65

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 provide safe drinking water to the employees.

If the workman dies a natural result of the disease which he was suffering or while suffering
from a particular disease he dies of that disease as a result of wear and tear, of the
employment no liability would be fixed upon the employer. But if the employment is a
contributory cause or has accelerated the death, or if the death was due not only to the
disease but also the disease coupled with the employment, then it can be said that the death
arose out of the employment and the employer would be liable.7

In a recent decision of Shakuntala Chandrakant Shresthi v Prabhakar Maruti

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Garvali1 the factors required to be established to be proved as an accident has taken
place and has culled out , are as follows:
i. Stress and strain arising during the course of employment
ii. Nature of employment
iii. Injury aggravated due to stress and strain

Agra Road Service Centre v Commissioner9

In this case, the deceased was a driver of employer’s vehicle. His duty was to fill petrol in the
petrol tank of the vehicles coming for the purpose, it is alleged that some dacoits came there
and stabbed Nand Ram and Nanda succumbed to fatal blows. Finally, the person died and the
Court ordered the employer to pay compensation under Sec 4A of the Workmen’s
Compensation Act,1923.

I. Death due to nervous shock or drowning

United India Insurance Co. Ltd., Divisional BranchVs. Padmini 10

The death of one Mr. Prahaladan, a Night Watchman in Devarshola Estate, Thasishola
Plantation Pvt. Ltd., Devarshola, Nilgiris District. On 12.3.2007, when he was engaged

7
JyothiAdemma v. Plant Engineer, Nellore ( 2006) 5 SCC 513

8
AIR 2007 SC 248

9
S. B. Civil Misc. Appeal No. 1257 of 2003, S. B. Civil Misc. Stay Application No. 1762 of 2003 with S. B. Civil
Cross Objection No. 39 of 2007
10
(2013)IIILLJ176Mad

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in his duty, he fell down from a vulnerable post. He sustained injuries. Besides, there
was shock. Though, he was provided with first aid and treated in Estate Garden
hospital and thereafter, rushed to Sultan Battery MES Hospital, about 25 kms away
from the Estate, he died. The certificate issued by the hospital indicated death was due
to stroke as a result of Cerebral Hemorrhage, and also hypertension. According to the
Insurance company, admittedly the deceased was suffering from hypertension and
other diseases, which ultimately led to cerebral hemorrhage and stroke and hence the
death was only due to the disease and not due to any employment injury, alleged to
have occurred on 12.3.2007. But the Court, held this as a personal injury resulting
from an accident.

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 Chapter 4: INSURANCE AND COMPENSATION LAWS(ESI ACT)

The Employee State Insurance Act, 1948, is a piece of social welfare legislation enacted
primarily with the object of providing certain benefits to employees in case of sickness,
maternity and employment injury and also to make provision for certain others matters
incidental thereto. The Act in fact tries to attain the goal of socio-economic justice enshrined
in the Directive principles of state policy under part 4 of our constitution, in particular articles
41, 42 and 43which enjoin the state to make effective provision for securing, the right to
work, to education and public assistance in cases of unemployment, old age, sickness and
disablement. APPLICABILITY Under sec 1(4) of the act, the Act applies to non-seasonal,
power using factories or manufacturing units employing twenty or more persons on wages.
Now, the provision of the act has also been extended the under sec 1(5) of act to cover: Like
shops, hotels, restaurants, cinemas, employing 20 or more persons

Act does not apply to:

 Mines
 Railway running sheds
 Govt. factories or establishments and Indian naval, military, or air force
 Other Govt. notified exempted establishments
 Seasonal factories engaged exclusively in any of the activities like: cotton ginning,
cotton or jute pressing, decoration of ground nuts, manufacturing
coffee, rubber, sugar, or tea or any manufacturing process incidental to or connected
with any of the afore said activities, and including factories engaged for a period not
exceeding seven months in a year in blending, packing or repackaging tea or coffee,
or in such other processes as may be specified by the central govt.

BENEFITS UNDER THE ACT

Six kinds of benefits are provided under the Act:
Sickness benefit
Maternity benefit
Disablement benefit
Dependents benefit
Medical benefit and

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 Funeral expenses.

Sickness & Extended Sickness benefit:

Sickness benefit is payable to an insured person in cash, in the event of sickness resulting in
absence from work and duly certified by an authorized insurable medical officer/ practitioner.
The benefit becomes admissible only after an insured has paid contribution for at least 78
days in a contribution period of 6 months.
Sickness benefit is payable for a maximum of 91 days in two consecutive contribution
period.
An insured person suffering from any special long-term diseases (liketuberculosis, mental
diseases) is eligible for extended sickness benefit at a rate which is 40% higher than the
standard benefit rate, round to the next higher multiple of 5 paisa, for a period of 124\309
days.
ESI is payable for a maximum period of 2 years on the basis of proper medical certification
and authentication by the designated authority

Enhanced sickness benefit

This cash benefit is payable to insured persons in the productive age group for undergoing
sterilisation operation, viz., vasectomy/ tubectomy.
The contribution is the same as for the normal sickness benefit.
Enhanced sickness benefit is payable to the Insured Persons for 14 days for tubectomy and
for seven days in case of vasectomy.

Maternity benefit
Confinement, miscarriage or medical termination of pregnancy.
Sickness arising out of pregnancy, confinement, premature birth of child or miscarriage or
medical termination of pregnancy.
Minimum 80 days in the immediately preceding two consecutive contribution periods is
must.
Maximum period for benefit is 91 days in one year.

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Disablement benefit:
Disablement benefit is payable to insured employees suffering from physical disablement
due to employment injury or occupation disease.
Temporary disablement benefit at 70% of the wages is payable till temporary disablement
lasts and is duly certified by authorised insurance medical officer.
In case of permanent disablement, the cash benefit is payable is payable for life. Amount
payable is worked out on the basis of earning capacity determined by a medical board.

Dependants benefit:
Dependants benefit [family pension] is payable to dependents of a deceased insured person
where death occurs due to employment or occupational disease.
A widow can receive this benefit on a monthly basis for life or till remarriage. A son or
daughter can receive this benefit till 18 years of age. Other dependents like parents including
a widowed mother can also receive the benefit under certain condition.
The rate of payment is about 70% of the wages shareable among dependents in a fixed
ratio.
The first installment is payable within a maximum of 3 months following the death of an
insured person and thereafter, on a regular monthly basis Medical benefit:
An insured person or a member of his family whose condition requires medical treatment
and attendance entitled to receive medical benefit.
Rs.250 on account of confinement expenses shall be paid to an insured person or his wife if
confinement occurs at a place where necessary medical facilities under these schemes are not
available.
Employer not to dismiss or punish employee during period of sickness-section73.
Funeral Expenses came in 1968:
If an insured employee dies, the eldest serving member of his family is entitled to
reimbursement of such expenditure subject to maximum of Rs.2500 (W.E. December, 2000)
The claim for the funeral expenses should be submitted with prescribed document and form
within three months of the death of the insured employee. Benefits cannot be combined:

An employee is not entitled to receive two benefits at the same time. That means he cannot
receive for the same period.

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 (a) Both sickness benefit and maternity benefit; or
(b) Both sickness benefit and disablement benefit for temporary disablement; or
(c) Both maternity benefit and disablement benefit for temporary disablement.
Offences and penalties:
Punishment for false statement :- In this case any false statement or false representation,
shall be punishable with imprisonment up to Rs.2000 or with both
Punishment for failure to pay contributions:- if any person fails to pay any contribution
which under to this act he is liable to pay, he shall be punishable with imprisonment up to
three years.
Punishment for other contravention :- in contraventions like dismisses, discharges, reduces
or otherwise punishes an employee, shall be punishable with imprisonment up to one year or
with fine up to Rs.4000 or with both.
Revision:
Employees State Insurance (ESI) Corporation, a statutory body headed by the Union Labor
minister, has revised its benefit rates of those insured and employers coming under the sub-
regional office, ESI Corporation Pune. The rates are revised as follows we’ve. December 1,
2007:
1.The daily rates of sickness benefit as given under rules 55 has been increased by 20 per
cent.
2.Daily rates of disability benefits have been increased to 50 per cent form 40per cent.
3.Daily rates of dependents benefit have been increased to 50 per cent from40 per cent.
4.Funeral expenses given under rule 59 has been increased to Rs. 3,000/-from Rs. 2,500/

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 Chapter 5: BARRIERS IN GETTING COMPENSATION

Barriers and problems in getting compensation:

The most commonly encountered problem and issues for the sufferer of an occupational
illness or injury are:
1. The compensation process is very time consuming
2. It is difficult to understand various provisions of the Acts
3. Necessity to establish the Employer-Employee relationship
4. Lack of medical diagnosis. Medical certificate not available
5. No standards for diagnosis. Different doctors give different disability percentages

Case Studies:
In the case of Bharat Gold Mines Ltd appeals were filed in Karnataka High Court against the
awards made by the Commissioner for Workmen’s Compensation, Kolar District (hereafter
‘the Commissioner’), awarding compensation to the workmen of the employer due to the
premature termination of their services by reason of occupational disease, namely silicosis,
contracted by them in the course of their employment in Bharat Gold Mines11. In the final
judgement, it was held that compensation in the case of contracting of occupational disease is
to be calculated on the basis of wages drawn at the time of termination of employment and
not on the date of contracting the occupational disease.

Hindustan Composites Limited- In 2004 about 34 compensation cases were filed in Bandra
Labour Court by workers of Hindustan Composites Limited located at Ghatkopar, Mumbai.
By 2010, only 32 claimants had been examined due to the lengthy procedure required under
the Workman Compensation Act. At the time of writing, a final decision by the Court had not
yet been made.

11
Karnataka High Court (1992) 1 LLN 1023

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 CONCLUSION AND SUGGESTIONS

Improvements sought under the Employee’s Compensation Act, 1923:

• The payment for medical expenses should be made by the employer directly.

• As per Section 2(n) certain categories of employees are not covered. All categories of
employees need to be covered under this law.

• Mechanism for ensuring enforcement of the compensation order should be set-up.

• Compensation should be delivered within a period of 1 month from the date of order.

Amendments required to improve ESI Act 1948:

• All compensation claims filed under the Acts to be processed and disposed of within 3
months from the date of filing of claims.

• In ESI Act, compensation is due from the date of confirmation and assessment by the
Special Medical Board. The Act is silent on the time period within which the claimant should
be examined by the board. In such circumstances, claimants have to wait for as long as two to
three years for the board to examine their claims. No compensation for the waiting period is
paid. This should be immediately changed by amending the law to the effect that the
compensation is due from the date of injury or diagnosis or first signs of physical debilitation.

• In order to ensure effective implementation of these Acts:

1. The worker should be immediately given the employment card, within a maximum of 7
days.

2. Where the ESI Act is applicable, the ESI inspectors should ensure that all workers are
registered under the ESI Act.

3. Where the ESI Act does not apply, in addition to Employee’s Compensation Act, an
insurance scheme for medical benefits and compensation for the dependents should be taken
by the employer.

Implementation Mechanism :

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There should be an implementation mechanism which will ensure that all compensation
claims which have been decided are implemented immediately, so that the worker does not
have to suffer any further. Penalties should be levied on any employer who defaults or delay
payments. This implementation mechanism should be independent of the Labour or ESI
courts and should include representatives from Employees (Unions), Employers, members of
civil society, and government representatives.

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 BIBLIOGRAPHY

Statutes
1. Employees Compensation Act, 1923
2. Insurance Act, 1938

Books
1. Kara Siddarth (Bonded Labor – Tackling the System of Slavery in South Asia), 2014,
Columbia University Press
2. Reddy, Hargal YR (Bonded Labour System in India : Causes, Practice, the Law) 1996,
South Asia Books
3. Tiwari Gaueav (Labour Law), 2012, Oxford University Press
4. Padhi PK (Labour and Industrial Laws) 2017, PHI Learning; 3rd Revised edition
edition
5. Misra SN (Labour and Industrial Laws) 2013, CENTRAL LAW PUBLICATION;
Twenty Seventh Edition (Rep.) edition (2013)
6. Singh Avatar (Introduction to Labour and Industrial Laws), 2016, Lexis Nexis; 2017
Fourth edition (23 December 2016)

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