The Employees Compensation Act, 1923

(1) This Act may be called the 1[Employee's]Compensation Act, 1923. 2[(2) It extends to the whole of India 3***.] (3) It shall come into force on the first day of July, 1924.

(1) In this Act, unless there is anything repugnant in the subject or context,-- 1* * * * * (b) "Commissioner" means a Commissioner for Workmen’s Compensation appointed undersection 20; (c) "compensation" means compensation as provided for by this Act; 2[(d) "dependant" means any of the following relatives of a deceased 3[employee], namely:-- (i) a widow, a minor 4[legitimate or adopted] son, and unmarried 4[legitimate or adopted]daughter, or a widowed mother; and (ii) if wholly dependent on the earnings of the 3[employee] at the time of his death, a son or adaughter who has attained the age of 18 years and who is infirm; (iii) if wholly or in part dependent on the earnings of the 3[employee] at the time of his death, (a) a widower, (b) a parent other than a widowed mother, (c) a minor illegitimate son, an unmarried illegitimate daughter or a daughter 5[legitimateor illegitimate or adopted] if married and a minor or if widowed and a minor, (d) a minor brother or a unmarried sister or a widowed sister if a minor, (e) a widowed daughter-in-law, (f) a minor child of a pre-deceased son, (g) a minor child of a pre-deceased daughter where no parent of the child is alive, or (h) a paternal grandparent if no parent of the 6[employee] is alive.] 7[Explanation.--For the purpose of sub-clause (ii) and items (f) and (g) ofsub-clause (iii), references to a son, daughter or child include an adopted son, daughter orchild respectively; 8[(dd) "employee" means a person, who is-- (i) a railway servant as defined in clause (34) of section 2 of the Railways Act, 1989(24 of 1989), not permanently employed in any administrative district or sub-divisional office ofa railway and not employed in any such capacity as is specified in Schedule II; or (ii) (a) a master, seaman or other member of the crew of a ship, (b) a captain or other member of the crew of an aircraft, (c) a person recruited as driver, helper, mechanic, cleaner or in any other capacity inconnection with a motor vehicle, (d) a person recruited for work abroad by a company, and who is employed outside India in any such capacity as is specified in Schedule II and theship, aircraft or motor vehicle, or company, as the case may be, is registered in India; or (iii) employed in any such capacity as is specified in Schedule II, whether the contract ofemployment was made before or after the passing of this Act and whether such contract isexpressed or implied, oral or in writing; but does not include any person working in the capacityof a member of the Armed Forces of the Union; and any reference to any employee who has beeninjured shall, where the employee is dead, include a reference to his dependants or any of them;] (e) "employer" includes anybody of persons whether incorporated or not and any managing agentof an employer and the legal representative of a deceased employer, and, when the services of a6[employee] are temporarily lent or let on hire to another person by the person with whom the6[employee] has entered into a contract of service or apprenticeship, means-such other person whilethe 6[employee] is working for him; (f) "managing agent" means any person appointed or acting as the representative of anotherperson for the purpose of carrying on such other person's trade or business, but does not include anindividual manager subordinate to an employer; 9[(ff) "minor" means a person who has not attained the age of 18 years;] (g) "partial disablement" means, where the disablement is of a temporary nature, suchdisablement as reduces the earning capacity of a 10[employee] in any employment in which he wasengaged at the time of the accident resulting in the disablement, and, where the disablement is of apermanent nature, such disablement as reduces his earning capacity in every employment which hewas capable of undertaking at that time: provided that every injury specified 11[in Part II of Schedule I] shall be deemed to result inpermanent partial disablement; (h) "prescribed" means prescribed by rules made under this Act; (i) "qualified medical practitioner" means any person registered 12* * * under any 13[Central Act,Provincial Act or an Act of the Legislature of a 14[State]] providing for the maintenance of a register ofmedical practitioners, or, in any area where no such last-mentioned Act is in force, any persondeclared by the State Government, by notification in the Official Gazette, to be a qualified medicalpractitioner for the purposes of this Act; 15* * * * * (k) "seaman" means any person forming part of the crew of any 16* * * ship, but does not includethe master of 17[the] ship; (l) "total disablement" means such disablement, whether of a temporary or permanent nature, asincapacitates a 10[employee] for all work which he was capable of performing at the time of theaccident resulting in such disablement: 18[Provided that permanent total disablement shall be deemed to result from every injury specifiedin Part I of Schedule I or from any combination of injuries specified in Part II thereof where theaggregate percentage of the loss of earning capacity, as specified in the said Part H against thoseinjuries, amounts to one hundred per cent.' or more;] (m) "wages" includes any privilege or benefit which is capable of being estimated in money,other than a travelling allowance or the value of any travelling concession or a contribution paid bythe employer of a 10[employee] towards any pension or provident fund or a sum paid to a 10[employee]to cover any special expenses entailed on him by the nature of his employment; 19 * * * * (2) The exercise and performance of the powers and duties of a local authority or of any department20acting on behalf of the Government] shall, for the purposes of this Act, unless a contrary intentionappears, be deemed to be the Trade or business of such authority or department. 21[(3) The Central Government or the State Government, by notification in the Official Gazette, aftergiving not less than three months’ notice of its intention so to do, may, by a like notification, add toSchedule H any class of persons employed in any occupation which it is satisfied is a hazardousoccupation, and the provisions of this Act shall thereupon apply, in case of a notification by the CentralGovernment, within the territories to which the Act extends, or, in the case of a notification by the StateGovernment, within the State, to such classes of person: Provided that in making addition, the Central Government or the State Government, as the case maybe, may direct that the provisions of this Act shall apply to such classes of persons in respect of specifiedinjuries only.]

1[3. Employer's liability for compensation.--(1) If personal injury is caused to a 2[employee] byaccident arising out of and in the course of his employment, his employer shall be liable to paycompensation in accordance with the provisions of this Chapter: Provided that the employer shall not be so liable-- (a) in respect of any injury which does not result in the total or partial disablement of the2[employee] for a period exceeding 3[three] days; (b) in respect of any 4[injury, not resulting in death 5[or permanent total disablement], caused by]an accident which is directly attributable to-- (i) the 2[employee] having been at the time thereof under the influence of drink or drugs, or (ii) the wilful disobedience of the 2[employee] to an order expressly given, or to a ruleexpressly framed, for the purpose of securing the safety of employee’s, or (iii) the wilful removal or disregard by the 2[employee] of any safety guard or other devicewhich he knew to have been provided for the purpose of securing the safety of 6[employees] 7*** 8* * * * * 9[(2) If a 2[employee] employed in any employment specified in Pat A of Schedule III contracts anydisease specified therein as an occupational disease peculiar to that employment, or if a 2[employee],whilst in the service of an employer in whose service he has been employed for a continuous period of notless than six months (which period shall not include a period of service under any other employer in thesame kind of employment) in any employment specified in Part B of Schedule III, contracts any diseasespecified therein as an occupational disease peculiar to that employment, or if a 2[employee] whilst in theservice of one or more employers in any employment specified in Part C of Schedule III for suchcontinuous period as the Central Government may specify in respect of each such employment, contractsany disease specified therein as an occupational disease peculiar to that employment, the contracting ofthe disease shall be deemed to be an injury by accident within the meaning of this section and, unless the contrary is proved, the accident shall be deemed to have arisen out of, and in the course of, theemployment: 10[Provided that if it is proved,-- (a) that a 11[employee] whilst in the service of one or more employers in any employmentspecified in Part C of Schedule III has contracted a disease specified therein as an occupationaldisease peculiar to that employment during a continuous period which is less than the period specifiedunder this sub-section for that employment, and (b) that the disease has arisen out of and in the course of the employment; the contracting of such disease shall be deemed to be an injury by accident within the meaning of thissection: Provided further that if it is proved that a 11[employee] who having served under any employer in anyemployment specified in Part B of Schedule III or who having served under one or more employers in anyemployment specified in Part C of that Schedule, for a continuous period specified under this sub-sectionfor that employment and he has after the cessation of such service contracted any disease specified in thesaid Part B or the said Part C, as the case may be, as an occupational disease peculiar to the employmentand that such disease arose out of the employment, the contracting of the disease shall be deemed to be aninjury by accident within the meaning of this section.] 12[(2A) If a 11[employee] employed in any employment specified in Part C of Schedule III contracts anyoccupational disease peculiar to that employment, the contracting whereof is deemed to be an injury byaccident within the meaning of this section, and such employment was under more than one employer, allsuch employers shall be liable for the payment of the compensation in such proportion as theCommissioner may, in the circumstances, deem just.] (3) 13[The Central Government or the State Government] after giving, by notification in the OfficialGazette, not less than three months’ notice of its intention so to do, may, by a like notification, add anydescription of employment to the employments specified in Schedule III, and shall specify in the case ofemployments so added the diseases which shall be deemed for the purposes of this section to beoccupational diseases peculiar to those employments respectively, and thereupon the provisions of subsection (2) shall apply 14[in the case of a notification by the Central Government, within the territories towhich this Act extends or, in case of a notification by the State Government, within the State] 15*** as ifsuch diseases had been declared by this Act to be occupational diseases peculiar to those employments.] (4) Save as provided by 16[sub-sections (2), (2A)] and (3) no compensation shall be payable to a11[employee] in respect of any disease unless the disease is 17*** directly attributable to a specific injury byaccident arising out of and in the course of his employment. (5) Nothing herein contained shall be deemed to confer any right to compensation on a 11[employee] inrespect of any injury if he has instituted in a Civil Court a suit for damages in respect of the injury againstthe employer or any other person; and no suit for damages shall be maintainable by a 11[employee] in anyCourt 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 18[employee] and his employer providing for thepayment of compensation in respect of the injury in accordance with the provisions of this Act.

2[4. Amount of compensation.--(1) Subject to the provisions of this Act, the amount ofcompensation shall be as follows, namely:-- (a) where death results from the injury an amount equal to 3[fifty per cent.] of themonthly wages of the deceased 1[employee]multiplied by the relevant factor;oran amount of 4[one lakh and twenty thousandrupees], whichever is more; (b) where permanent total disablementresults from the injuryan amount equal to 5[sixty per cent.] of themonthly wages of the injured 1[employee]multiplied by the relevant factor;oran amount of 6[one lakh and forty thousandrupees],whichever is more: 7[Provided that the Central Government may, by notification in the Official Gazette, from time totime, enhance the amount of compensation mentioned in clauses (a) and (b);] Explanation I.--For the purposes of clause (a) and clause (b), "relevant factor", in relation to a1[employee] means the factor specified in the second column of Schedule IV against the entry in thefirst column of that Schedule specifying the number of years which are the same as the completedyears of the age of the 1[employee] on his last birthday immediately preceding the date on which thecompensation fell due. 8* * * * * (c) where permanent partial disablementresults from the injury.(i) in the case of an injury specified in Part II ofSchedule I, such percentage of the compensationwhich would have been payable in the case ofpermanent total disablement as is specifiedtherein as being the percentage of the loss ofearning capacity caused by that injury, and(ii) in the case of an injury not specified inSchedule I, such percentage of the compensationpayable in the case of permanent totaldisablement as is proportionate to the loss ofearning capacity (as assessed by the qualifiedmedical practitioner) permanently caused by theinjury. Explanation I.--Where more injuries than one are caused by the same accident, the amount ofcompensation payable under this head shall be aggregated but not so in any case as to exceed theamount which would have been payable if permanent total disablement had resulted from the injuries. Explanation II.--In assessing the loss of earning capacity for the purposes of sub-clause (ii), thequalified medical practitioner shall have due regard to the percentages of loss of earning capacity inrelation to different injuries specified in Schedule I; (d) where temporary disablement, whether totalor partial results from the injurya half-monthly payment of the sum equivalentto twenty-five per cent. of monthly wages ofthe 9[employee], to be paid in accordance withthe provisions of sub-section (2). 10[(1A) Notwithstanding anything contained in sub-section (1), while fixing the amount ofcompensation payable to a 9[employee] in respect of an accident occurred outside India, theCommissioner shall take into account the amount of compensation, if any, awarded to such 9[employee]in accordance with the law of the country in which the accident occurred and shall reduce the amountfixed by him by the amount of compensation awarded to the 9[employee] in accordance with the law ofthat country.] 11[(1B) The Central Government may, by notification in the Official Gazette, specify, for the purposesof sub-section (I), such monthly wages in relation to an employee as it may consider necessary;] (2) The half-monthly payment referred to in clause (d) of sub-section (1) shall be payable on thesixteenth day-- (i) from the date of disablement where such disablement lasts for a period of twenty-eight days ormore, or (ii) after the expiry of a waiting period of three days from the date of disablement where suchdisablement lasts for a period of less than twenty-eight days; and thereafter half-monthly during thedisablement or during a period of five years, whichever period is shorter: Provided that-- (a) there shall deducted from any lump sum or half-monthly payments to which the 9[employee]is entitled the amount of any payment or allowance which the 9[employee] has received from theemployer by way of compensation during the period of disablement prior to the receipt of such lumpsum or of the first half-monthly payment, as the case may be; and (b) no half-monthly payment shall in any case exceed the amount, if any, by which half theamount of the monthly wages of the 9[employee] before the accident exceeds half the amount of suchwages which he is earning after the accident. Explanation.--Any payment or allowance which the 9[employee] has received from the employertowards his medical treatment shall not be deemed to be a payment or allowance received by him by wayof compensation within the meaning of clause (a) of the proviso. 11[(2A) The employee shall be reimbursed the actual medical expenditure incurred by him fortreatment of injuries caused during the course of employment.] (3) On the ceasing of the disablement before the date on which any half-monthly payment falls duethere shall be payable in respect of that half-month a sum proportionate to the duration of the disablementin that half-month.] 12[(4) If the injury of the 13[employee] results his death, the employer shall, in addition to thecompensation under sub-section (1), deposit with the Commissioner a sum of 14[two thousand and fivehundred rupees] for payment of the same to the eldest surviving dependant of the 13[employee] towards theexpenditure of the funeral of such 13[employee] or where the 13[employee] did not have a dependant or wasnot living with his dependant at the time of his death to the person who actually incurred suchexpenditure.] 15[Provided that the Central Government may, by notification in the Official Gazette, from time totime, enhance the amount specified in this sub-section.]

2[4A. Compensation to be paid when due and penalty for default.--(1) Compensation undersection 4 shall be paid as soon as it falls due. (2) In cases where the employer does not accept the liability for compensation to the extent claimed,he shall be bound to make provisional payment based on the extent of liability which he accepts, and,such payment shall be deposited with the Commissioner or made to the1[employee], as the case may be,without prejudice to the right of the 1[employee] to make any further claim. 3[(3) Where any employer is in default in paying the compensation due under this Act within onemonth from the date it fell due, the Commissioner shall-- (a) direct that the employer shall, in addition to the amount of the arrears, pay simple interestthereon at the rate of twelve per cent. per annum or at such higher, rate not exceeding the maximumof the lending rates of any scheduled bank as may be specified by the Central Government bynotification in the Official Gazette, on the amount due; and (b) if, in his opinion, there is no justification for the delay, direct that the employer shall, inaddition to the amount of the arrears and interest thereon, pay a further sum not exceeding fifty percent. of such amount by way of penalty: Provided that an order for the payment of penalty shall not be passed under clause (b) without givinga reasonable opportunity to the employer to show cause why it should not be passed. Explanation.--For the purposes of this sub-section, "scheduled bank" means a bank for the timebeing included in the Second Schedule to the Reserve Bank of India Act, 1934. 4[(3A) The interest and the penalty payable under sub-section (3) shall be paid to the 1[employee] orhis dependant, as the case may be.]