Introduction
The backbone of every company is its employees hence if a company wants to grow it is imperative that the employs perform well and in turn it’s the company’s responsibility to take care of its employees. However, this care is not limited to only payment of adequate wages to the employees for their work it also extends to taking care that employees are provided with safe work environment. Also, if the employee is injured while on duty, they get the adequate compensation for the injury. This article will talk about the Employers liability for workplace injuries and provide a complete overview of what you need to know as an employer.
While the payment of wages to an employee is governed by The Minimum Wages Act, 1948 (“Act”), similarly the compensation for injuries sustained by employees is governed by Employees Compensation Act, 1923 which was previously known as the Workmen Compensation Act, 1923. The act aims to provide payment in the form of compensation by the employers to the employees for any injuries they have suffered during an accident.
Liability to pay compensation and quantum
Section 3 of the Act provides that the employer is liable to pay compensation when a personal injury is caused to an employee by accident arising out of and in the course of his employment. For compensation it is necessary that an injury is caused due to their employment for them to be eligible for compensation under this Act. Furthermore, if an employee contracts a disease which is specified as an occupational disease unique to that type of employment, the disease will be considered an injury by accident under this section. Unless proven otherwise, it shall be presumed that the accident occurred in the course of and as a result of the employment and the employers shall be liable to pay adequate compensation to the employee.
The amount of compensation varies according to the intensity of the injury, the calculation for different injuries is set out in section 4 of the Act.
When are the employers not liable to pay compensation
Although the act aims to secure the rights of the employees to get adequate compensation in case of injury it also provides situations where the employers is not liable to pay compensation so as to not put the employers at a disadvantage. These situations are laid out in section 3 of the Act as well which states that the employer is not liable to pay compensation in respect of any injury which does not result in the total or partial disablement of the employee for a period exceeding three days; or any injury, which is directly attributable to:
- the employee being under the influence of drink or drugs, or
- the wilful disobedience of the employee to an order, or to a rule framed, for the purpose of securing the safety of employees,
- the wilful disregard by the employee of any safety guard or other device which he knew was put in place for their own safety.
Conclusion
The Employee Compensation Act is important for protecting workers, but it can also present risks for employers, including financial and legal challenges. To reduce these risks, employers should consider getting comprehensive insurance to cover potential compensation costs. Fostering a safe work environment through regular training and safety protocols can help prevent accidents and minimize claims. Keeping accurate records, reporting incidents promptly, and seeking legal advice in careful drafting of the employment handbook as well as SOP for handling equipment and machinery can also help ensure compliance and avoid disputes and mitigate potential risks on employers. Additionally, making sure employees understand their rights under the Act can lead to clearer communication and fewer misunderstandings. Taking these steps can help employers manage risks and maintain a safe, compliant workplace.
