EMPLOYER’S LIABILITY FOR

COMPENSATION ACT, 1923

Group 3: Rishabh Malhotra, Keshav Kumar, Karan Gupta,
Shivam Goel, Shivam Singh
Objectives of Employees Compensation Act
 Employee’s Compensation Act, 1923 was earlier known as Workmen’s Compensation Act, 1923.

 Aims to provide an employee or to their dependants some relief in case of accidents arising out of and in
course of employment and causing either death or disablement of employees.

 Act contains IV chapters which includes 36 Sections and IV Schedules.

Employees Entitled

 Every employee including those who are employed through a contractor and casual employees.
 Who suffers injury in any accident arising out of and in the course of employment.
Employer’s Liability for Compensation
 Section 3 of the Act provides for employers liability for compensation in case of occupational disease or
personal injuries and prescribes the manner in which his liability can be ascertained.

 Section 3 (1) of the Act provides the situation when employer are liable for compensation to his employee
for personal injury caused to him by an accident arising out of and in the course of his employment.

 Proviso of sub-section 1 gives the conditions when employer is not liable to pay compensation to
employees:
 When the injury does not result in disablement for a period exceeding 3 days.

 When the injury not resulting in death or permanent total disability is due to any of the following
reasons:
a) Employee at the time of accident, under the influence of drink or drugs, or
b) Employee willfully disobeyed an order expressly given for the purpose of securing safety of
workers, or
c) Employee willfully disregards or removes any safety guards or safety devices which he knew
to have been provided for the safety of the employee.
1. Occupational Disease (Section 3(2))

Employees employed in certain occupations are exposed to certain diseases which are inherent in those
occupations. Contracting of occupational disease is deemed to be an injury by accident and is deemed to be
arisen out of employment and in the course of employment.

Schedule III to the Act gives the list of occupational diseases. This schedule is divided in three parts: Part
A, Part B & Part C.

 Part A gives the list of occupational disease and contracting of such diseases is deemed to be an inquiry
by accident and is deemed to be arisen out of employment and in the course of employment.

 Part B gives the list of occupational diseases and contracting of such diseases is deemed to be an injury
by accident and is deemed to be arisen out of employment and in the course of employment if an
employee was employed for a continuous period of 6 months or more.

 Part C gives the list of occupational disease and contracting of such diseases is deemed to be a injury by
accident by accident and is deemed to be arisen out of employment and in the course of employment if
an employee while in service of one or more employers contracts any disease.
Case Study -1

Q: An employee who was employed as an electrician had to go frequently to a heating room from a cooling
plant to perform his duties. He was attacked by pneumonia and died after short illness. If the claim of
worker would succeed?

Sol: Section 3 provides for employers liability for compensation in case of occupational disease or personal
injuries. In Indian News Chronicle v. Mrs. Lazarus, an electrician who had to go frequently to a heating
room from a cooling plant, contracted pneumonia which is resulted in his death, it was held that the injury
caused by an accident is not confined to physical injury and the injury in the instant case was due to his
working and going from a heating room to a cooling plant as it was his indispensable duty. In view of above
decision, the heir of the employees will succeed in claiming compensation.
Suit for Damages in a Court Barred(Section 3(5))

Nothing herein contained shall be deemed to confer any right to compensation on a

workman 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 a workman 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 workman and his employer
providing for the payment of compensation in respect of the injury in accordance with
the provisions of this Act.
Case Study

 Union Of India vs Gopaldar Varandmal And Anr. on 13 August, 1965

 This is an appeal from an order of remand of a case passed by the
learned Assistant Judge, Mehsana of 1961, on 7 August 1963, on his
reversing the decision of the trial court disposing of the suit upon a
preliminary issue.
 The issue was as regards the maintainability of a civil suit for damages by
a workman in a civil court in respect of an injury to his eye resulting from
the alleged negligence of his employer and the persons appointed by the
employer to provide timely and efficient medical aid for treatment of the
injury received by the workman in the course of his employment.
 The workman had allegedly instituted a claim to compensation in respect
of the injury under the Workmen's Compensation Act.
 The learned Judge has found that the suit as framed was maintainable and his
finding is based mainly on the ground that the suit was one for damages suffered by
the workman as a result of the negligence or want of care on the part of the
employer and the doctors appointed by the employer and resulting in an injury to
the workman's right eye and apprehensions of loss of vision to his left eye.
 The learned Judge has accordingly reversed the finding of the trial Court which had
found that the suit was barred by Sub-section (5) of S. 3 of the Workmen's
Compensation Act. 1923 (8 of 1923).