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E1-E2: ELECTRICAL

CHAPTER-10
SALIENT FEATURES OF:
(a) WORKMEN'S COMPENSATION ACT 1923
(b) MINIMUM WAGES ACT 1948
(c) EPF & MISC PROVISION ACT 1952

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Salient Features Of:(A) Workmen's Compensation Act 1923

(B) Minimum Wages Act 1948 (C) Epf & Misc Provision Act
1952
Workmen's Compensation Act, 1923: Provisions And Applicability
The Workmen's Compensation Act, 1923 is one of the important social security
legislations. It aims at providing financial protection to workmen and their dependants 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.

Applicability of the Act

The Act extends to the whole of India except the States/Union Territories of Arunachal
Pradesh, Mizoram, Nagaland, Sikkim and Daman & Diu and Lakshadweep. 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.

Compensation
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

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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. The Indian Workmen's Compensation Act
1923 provides for the payment of compensation by the employer to his employees
(for their dependents in the event of fatal accidents) if personal injury is caused to
them by accidents arising out of and in the course of their employment. The maximum
compensation payable is upon the following scale (as per W.C.
Amendment Act 2000).

 Fatal Injury - Rs.4,57,080

 Permanent Total Disablement - Rs.5,48,496
 Permanent Partial Disablement - According to incapacity caused
 Temporary Disablement - Rs. 2000 per month upto a period of 5 years

Minimum Wages Act 1948

The issue of fixation of minimum wages is of primary importance in a country like India
where 300 million people are employed in the informal sector with no collective
bargaining power. This is 93 percent of the workers. The enactment of the
Minimum Wages Act in 1948 is a landmark in the labour history of India. The
Act provides for fixation of minimum wages for notified scheduled employment.

Objectives:
The Minimum Wages Act was formulated to provide for fixing minimum rates of wages
in certain employments. The Act also governs certain service conditions such as working
hours, weekly rest days and payment of overtime for employees covered under
the act.

Applicability:
The Minimum Wages Act extends to whole of India and applies to all
establishments employing one or more persons and engaged in any of scheduled
employments. It covers every employee who is engaged in any scheduled employment,
including an out worker to whom materials are given out for manufacturing or
processing at his own premises. There are 45 scheduled employments in the Central
sphere and 1232 in the state sphere for which minimum wages have been fixed. To
protect the wages against inflation they were linked to rise in the Consumer Price Index.
The variable dearness allowance came into being in 1991 and the allowance is
revised twice a year . At present 22 states /Union Territories have these provisions.

Enforcement:
There is a Labour Commission with subsidiaries till the regional level and which appoints

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inspectors for enforcement of the provision of the minimum wages. They are the Labour
Enforcement Officers who conduct crash inspection programmes. They inspect the wage
records and see that holidays, overtime and bonuses as prescribed in the minimum Wages
Act are followed. If the regulations are not followed then the employers can be
prosecuted. The nature of violation decides whether the Labour Commission offices
arbitrate or the state courts. The scheduled list of employment is not exhaustive, there are
many trades which are out of it. Most of the times minimum wages are paid not on hourly
or daily basis but on piece rates which are very low.

Main provisions under the Act

(1) Fixing of minimum rates of wages
(a) The appropriate Government may fix the minimum rates of wages payable
to employees employed in an employment specified in Part - I or Part - II of the Schedule
and in an employment added to the Schedule. The Government may review the
minimum rates of wages and revise the minimum rates at intervals not exceeding
five years.
(b) The appropriate Government may fix a minimum rate of wages for time
and for piece rate. However different wage rates may be fixed for different
scheduled employments, different classes of work in the same scheduled
employment, for adults, adolescents, children and apprentices and for different localities
and for any one or more of the wage periods, viz., by the hour or by the day or by
the month or by such larger period.

(2) Minimum rate of wages

Any minimum rate of wages fixed or revised may consist of
(i) a basic rate of wages and a special allowance.
(ii) a basic wage rate with or without cost of living allowances and the cash value of
concessions in respect of supplies of essential commodities at concessional rates.
(iii) an all inclusive rate allowing for the basic rate, the cost of living allowance and
the cash value of concessions.

(3) Procedure for fixing and revising minimum wages

The appropriate Government may appoint an advisory Board for advising it, generally in
the matter of fixing and revising minimum rates of wages. The Central Government
may appoint a Central Advisory Board for the purpose of advising the Central and
State Governments in the matters of the fixation and revision of minimum rates of wages.
The Central Advisory Board may consist of persons to be nominated by the
Central Government representing employers and employees in the scheduled
employments, in equal number and independent persons not exceeding one third of

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its total nmber of members. One of such independent persons would be appointed
chairman of the Board by the Central Government.

(4) Wages in kind

Minimum wages payable under this Act are to be paid in cash. The payment of minimum
wages can be made wholly or partly in kind by notification in the official Gazette if it is
customary to pay wages wholly or partly in kind.

(5) Payment of minimum rate of wages

The employer is required to pay to every employee engaged in a scheduled employment
under him wages at a rate not less than the minimum rate of wages fixed by the
competent authority. (6) Fixing hours for normal working day
In regard to any scheduled employment minimum rates of wages in respect of which have
been fixed under this Act, the appropriate Government may
(a) fix the number of hours of work which shall constitute a normal working
day inclusive of one or more specified intervals.
(b) provide for a day of rest in every period of seven days which shall be allowed to
all employees or to any specified class of employees and for the payment of
remuneration in respect of such days of rest. (c) provide for payment for work on a day
of rest at a rate not less than the overtime rate.

(7) Overtime
If any employee whose minimum rate of wages is fixed under the Act works on any day
in excess of the number of hours constituting normal working day, the employer
is required to pay him at the overtime rate fixed under this Act or under any law
of the appropriate Government for the time being in force whichever is higher.

(8) Wages for two or more classes of work

If an employee does two or more classes of work to each of which a different
rate of wages is applicable, the employer is required to pay to such employee in respect
of the time respectively occupied in each such class of work, wages at not less
than the minimum time rate in respect of each class.

(9) Maintenance of registers and records

Every employer is required to maintain such registers and records giving
particulars of employees, the work performed by them, the wages paid to them, the
receipts given by them and any other required particulars.

(10) Inspections

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The appropriate Government may, by notification in the official Gazette, appoint

inspectors for the purpose of this Act and define the local limits of their functions.

(11) Claims
The appropriate Government may appoint Labour commissioner or any other officer with
experience as a judge of a civil court or as a stipendiary Magistrate to hear and decide for
any specified areas, all claims arising out of the payment of less than the minimum rates
of wages as well as payment for days of rest or for work done.

(12) Penalties for Offences

Any employer who contravenes any provision of this Act shall be punishable with
imprisonment for a term, which may extend to six months or with fine, which may extend
to five hundred rupees or with both.

Summary:
 The Minimum Wages Act aims to extend the concept of social justice to
the employees employed in certain scheduled employments including agriculture.
 The Act provides for statutory fixation and revision of minimum rates of wages
by the Central or State Governments within a specified period.
 The appropriate Govt. is empowered to extend the application to any other
employment in respect of which it is of the opinion that the minimum
rates of wages are to be fixed under the Act.
 The minimum rates of wages vary from state to state, area to area and
from employment to employment.

Different Sections Of Minimum Wages Act, 1948:

1. Short title and extent:
2. Interpretation
3. Fixing of minimum rates of wages
4. Minimum rate of wages
5. Procedure for fixing and revising minimum wages
6. Advisory committees and sub-committees
7. Advisory Board
8. Central Advisory Board
9. Composition of committees, etc.
10. Correction of errors
11. Wages in kind
12. Payment of minimum rates of wages
13. Fixing hours for a normal working day, etc.

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14. Overtime
15. Wages of worker who works for less than normal working day
16. Wages for two or more classes of work
17. Minimum time rate Wages for piece work
18. Maintenance of registers and records
19. Inspectors
20. Claim
21. Single application in respect of a number of employees
22. Penalties for certain offences
22A.General provision for punishment of other offences
22B. Cognizance of offences
22C. Offences by companies
22D. Payment of undisbursed amounts due to employees
22E. Protection against attachment of assets of employer with government
22F. Application of Payment of Wages Act, 1936 to scheduled employments
23. Exemption of employer from liability in certain cases
24. Bar of suits
25. Contracting out
26. Exemptions and exceptions
27. Power of State Government to add to Schedule
28. Power of Central Government to give directions
29. Power of Central Government to make rules
30. Power of appropriate government to make rules
30A. Rules made by Central Government to be laid before Parliament
31. Validation of fixation of certain minimum rates of wages

Employees' Provident Funds & Miscellaneous Provisions Act

Objective
The Employees Provident fund and Miscellaneous Provisions Act,1952 is a social
security measure aimed at
promoting and securing the well being of the employees by way of provident
fund, family pension and insurance to them. inculcating a habit of saving amongst
workers. providing a steady workforce to the employers and assisting the government
by providing funds of considerable magnitude for utilization on various projects
meant for promoting economic and social development of the country and the well
being of its people.

Applicability
The Employees' Provident Fund and Miscellaneous Provisions Act 1952 applies to

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the whole India except Jammu & Kashmir. Employees' Provident Fund and
Miscellaneous Provisions Act 1952 is applicable to:
 Every establishment which is engaged in any one or more of the industries
specified in Schedule I of the Act or any activity notified by Central Government
in the Official Gazette.
 Employing 20 or more persons .
 Cinema Theatres employing 5 or more persons.
The establishment to which this Act applies shall continue to be governed by this Act ,
even if the number of employees falls below 20 at a later date.

Contributions
Employees Provident fund scheme takes care of the members at the time of
retirement, medical care, housing, family obligations, education of children, finance
of insurance policies. etc. In terms of section 6 of the Act, the employee may contribute
12 or 10 %, as the case may be, of the basic wages, dearness allowance including the cash
value of any food concession and retaining allowance. An allowance paid to an
employee for retaining his services when the establishment is not working is
retaining allowance. The rate of contribution shall be 10% in the case of certain
establishments
any covered establishment with less than 20 employees;
any sick industrial company with in the meaning of SICA
any establishment which has at the end of the financial year accumulated losses
equal to or exceeding its entire net worth;
any establishment in the business of jute, beedi, brick, coir.

If the employee so desires, he may opt to contribute a higher rate also. However,
employer does not have to match the voluntary contribution over and above the statutory
rate. The employer‟s contribution of 12% or 10% shall be up to 8.33% of the
basic wages, dearness allowance and retaining allowance towards Employees‟
Pension Scheme and the balance 1.67%/ 3.67% towards the provident fund. The
employer‟s contribution to the Employees deposit linked insurance scheme shall be
0.5 % of the basic wages, dearness allowance, retaining allowance. In addition, the
employer has to pay @ 1.10% of „pay‟ Contribution and .01% towards administrative
charges of fund and insurance scheme respectively. The employee does not have to make
any contribution to the pension fund account. These amounts must be paid within 15 days
from close of every month with the PF commissioner into the respective accounts
maintained with the State bank of India. If the amount is not paid, employer is
liable to pay “damages”. In addition, criminal prosecution can also be launched.

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Filing of returns
The employer shall within 15 days of the applicability of the Act send the
particulars of all branches, departments, owners, occupiers, director, partners or
any other person in charge of and responsible for the conduct of business, in form
5 A (Return of ownership), in duplicate, to the commissioner. In the event of any change,
the same too should be intimated within 15 days to the regional commissioner.
The commissioner shall on receipt of the return of ownership verify the particulars
submitted therein and after having been satisfied allot an establishment code No. This
code shall be mentioned on all forms, challans, statements, returns and all future
correspondence. A return in the prescribed form 5 in respect of employees
qualifying to be members of the fund for the first month during the preceding month
shall be filed within 15 days of the close of every month be sent to the CPFC. A
monthly return of contributions in the prescribed form 6 has to be filed with the
commissioner within 25 days of the close of the month. Annual return of contributions
in form 6 A reflecting the employer and employees contribution in respect of each
employee is to be submitted within one month of the close of the period of currency to
the commissioner.

Modes of recovery
The recovery officer shall proceed to recover the amounts in any one or more of the
modes given below.
a. attachment and sale of moveable or immoveable property of the establishment or
employer
b. arrest of the employer and his detention in prison or
c. appointing a receiver for the management of the moveable or immoveable
Properties of the establishment or employer (Section 8 B)

Offences by Companies
In case of an offence by a company, every person who at the time of the offence was
committed was - in charge of the company and - was responsible for the conduct of
business of the company as well as the company itself shall be deemed to be guilty of
the offence and shall be liable to be proceeded against and punished accordingly.
Unless a person fulfills both the requirements i.e. being in charge as well as
responsible to the company for the conduct of its business, no prosecution shall lie
against him. The words „deemed‟ is significant as the company is an artificial person
and the person in charge of the company and responsible for the conduct of
business bears a vicarious liability for being prosecuted in respect of the offence
committed by the company.

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However, the person prosecuted can take the defense that the offence was committed
without his knowledge or that he had exercised all due diligence to prevent the
commission of the offence. if, however, it is proved that the offence was committed with
the consent or connivance or is attributable to any neglect on the part of any
director, manager, secretary or any other officer of the company then such
director, manager, secretary or any other officer shall be deemed to be guilty of that
offence and shall be liable to be punished.

Act not to apply to certain [establishments].

(1) This Act shall not apply -
(a) to any establishment registered under the Co-operative Societies Act, 1912
(2 of 1912), or under any other law for the time being in force in any State
relating to co-operative societies, employing less than fifty persons and working
without the aid of power; or
(b) to any other establishment belonging to or under the control of the Central
Government or a State Government and whose employees are entitled to the benefit of
contributory provident fund or old age pension in accordance with any scheme or
rule framed by the Central Government or the State Government governing such benefits;
or
(c) to any other establishment set up under any Central, Provincial or State
Act and whose employees are entitled to the benefits of contributory provident
fund or old age pension in accordance with any scheme or rule framed under that
Act governing such benefits;
(2) If the Central Government is of opinion that having regard to the financial position of
any class of [establishments] or other circumstances of the case, it is necessary or
expedient so to do, it may, by notification in the Official Gazette, and subject to
such conditions as may be specified in the notification, exempt [, whether
prospectively or retrospectively;] that class of [establishments] from the operation
of this Act for such period as may be specified in the notification.

Transfer of accounts.
(1) Where an employee employed in an establishment to which this Act applies leaves his
employment and obtains re-employment in another establishment to which this Act
does not apply, the amount of accumulations to the credit of such employee in the Fund
or, as the case may be, in the provident fund of the establishment left by him
shall be transferred, within such time as may be specified by the Central
Government in this behalf, to the credit of his account in the provident fund of the
establishment in which he is re-employed, if the employee so desires and the rules in
relation to that provident fund permit such transfer. (2) Where an employee employed in

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an establishment to which this Act does not apply leaves his employment and obtains
re-employment in another establishment to which this Act applies, the amount of
accumulations to the credit of such employee in the provident fund of the
establishment left by him may, if the employee so desires and the rules in relation to such
provident fund permit, be transferred to the credit of his account in the Fund or, as the
case may be, in the provident fund of the establishment in which he is re-employed.

Liability In case of transfer of establishment.

Where an employer, in relation to an establishment, transfers that establishment in
whole or in part, by sale, gift, lease or licence or in any other manner
whatsoever, the employer and the person to whom the establishment is so
transferred shall jointly and severally be liable to pay the cntribution and other sums
due from the employer under any provision of this Act or the Scheme [the Pension
Scheme or the Insurance Scheme] as the case may be, in respect of the period up to the
date of such transfer : Provided that the liability of the transferee shall be limited
to the value of the assets obtained by him by such transfer.

Summary:
 The objective of the Employees‟ Provident Funds and Miscellaneous Provisions
Act is to make some provisions for the future of the industrial worker
after his retirement or for the dependants in case of his early death and to
inculcate the habit of saving among the workers.
 All categories of employees drawing pay not exceeding Rs.6500 /- per month are
eligible for membership of the fund irrespective of their length of service.
 All the three schemes, namely, the Employees‟ Provident Funds scheme, 1952;
the Employees‟ Pension scheme; and the Employees‟ Deposit-Linked Insurance
scheme, 1976 are administered by the Central Board of Trustees which is
a tripartite body.
 The Central Provident Fund Commissioner is the Chief Executive Officer
of the Organisation and ex-officio member secretary to the board.
DIFFERENT SECTIONS OF EMPLOYEES' PROVIDENT FUNDS &
MISCELLANEOUS PROVISIONS ACT, 1952:
Section 1: Short title, extent and application
Section 2: Definitions
Section 2A: Establishment to include all departments and branches.
Section 3: Power to apply Act to an establishment, which has a common provident fund
with another establishment.
Section 4: Power to add to Schedule I.
Section 5: Employees' Provident Fund Schemes.

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Section 5A: Central Board.

Section 5AA: Executive Committee.
Section 5B: State Board.
Section 5C: Board of Trustees to be body corporate.
Section 5D: Appointment of officers.
Section 5DD: Acts and proceedings of the Central Board or Its Executive
Committee or the State Board not to be invalidated on certain grounds.
Section 5E: Delegation.
Section 6: Contributions and matters, which may be provided for in Schemes.
Section 6A: Employees' Pension Scheme
Section 6B: Employees' Deposit-linked Insurance Scheme.
Section 6C: Laying of schemes before Parliament.
Section 7: Modification of Scheme.
Section 7A: Determination of moneys due from employers.
Section 7B: Review of orders passed under section 7A.
Section 7C: Determination of escaped amount.
Section 7D: Employees' Provident Funds Appellate Tribunal.
Section 7E: Term of office.
Section 7F: Resignation.
Section 7G: Salary and allowances and other terms and conditions of service of
Presiding Officer.
Section 7H: Staff of Tribunal.
Section 7-I: Appeals to Tribunal.
Section 7J: Procedure of Tribunals.
Section 7K: Right of appellant to take assistance of legal practitioner and of Government,
etc., to appoint presenting officers.
Section 7L: Orders of Tribunal.
Section 7M: Filling up of vacancies.
Section 7N: Finality of orders constituting a Tribunal.
Section 7-O: Deposit of amount due, on filing appeal.
Section 7P: Transfer of certain applications to Tribunals.
Section 7Q: Interest payable by the employer.
Section 8: Mode of recovery of moneys due from employers.
Section 8A: Recovery of monies by employers and contractors.
Section 8B: Issue of certificate to the Recovery Officer.
Section 8C: Recovery Officer to whom certificate Is to be forwarded.
Section 8D: Validity of certificate and amendment thereof.
Section 8E: Stay of proceedings under certificate and amendment or withdrawal thereof.
Section 8F: Other modes of recovery.

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Section 8G: Application of certain provisions of Income-tax Act.

Section 9: Fund to be recognised under Act XI of 1922.
Section 10: Protection against attachment.
Section 11: Priority of payment of contributions over other debts.
Section 12: Employer not to reduce wages, etc.
Section 13: Inspectors.
Section 14: Penalties.
Section 14A: Offences by companies.
Section 14AA: Enhanced punishment in certain cases after previous conviction.
Section 14AB: Certain offences to be cognizable.
Section 14AC: Cognizance and trial of offences.
Section 14B: Power to recover damages.
Section 14C: Power of court to make orders.
Section 15: Special provisions relating to existing provident funds.
Section 16: Act not to apply to certain [establishments].
Section 16A: Authorising certain employers to maintain provident fund accounts.
Section 17: Power to exempt.
Section 17A: Transfer of accounts.
Section 17AA: Act to have effect notwithstanding anything-contained in Act 31 of 1956.
Section 17B: Liability In case of transfer of establishment.
Section 18: Protection of action taken in good faith.
Section 18A: Presiding Officer and other Officers to be public servants.
Section 19: Delegation of powers.
Section 20: Power of Central Government to give directions.
Section 21: Power to make rules.
Section 22: Power to remove difficulties.

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