Page 293 - DCOM404_CORPORATE_LEGAL_FRAMEWORK

Corporate Legal Framework

Notes Introduction

The Employees' Provident Funds and Miscellaneous Provisions Act, 1952 is a social welfare
legislation enacted for the purpose of institution of provident fund for employees in factories
and other establishments. The provisions are intended for the better future of the industrial
worker on his retirement and also for his dependents, in the event of his death in the course of
employment. Gratuity is the gift or a present received by the employee from his organisation
for the services rendered by him. The Payment of Gratuity Act, 1972 provides a scheme for the
gratuity payment to employees engaged in factories, mines, oilfields, plantations, ports, railways,
etc. welfare measures like pension, provident fund, gratuity, etc are in confirmation with the
directive principles of State Policy of the Constitution of India.

13.1 Workmen Compensation Act, 1923

Workmen Compensation Act is an Act to provide for the payment by certain classes of employers
to their workmen of compensation for injury by accident. Where as it is expedient to provide for
the payment by certain classes of employers to their workmen of compensation for injury by
accident.
Object: The objective of this Act is that in the case of an employment injury Compensation is
provided to the injured workman and in case of his death to his dependants.

Employer to pay compensation: In case a individual injury is caused to a workman 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.
When employer is not liable: In case the disablement of workman 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 workman
or upon his wilful disobedience to obey safety rules or removal of safety guards by him.

Amount of compensation: In case of death:- an amount equal to 50% of the monthly wage
multiplied by the relevant factor as given in Schedule IV of the Act or 80,000/- whichever is
more. In case of permanent total disablement, it is 60% or 90,000/- whichever is more In case
of permanent partial disablement occurs then the compensation is proportionate to the disability
arrived as at (2) above.
Notice: An injured person or his dependants have to give a notice to the employer to pay
compensation.

Claim: Upon the failure or refusal of an employer to give compensation, an application is to the
made in Form - F to the Commissioner under the Workmen’s Compensation Act, 1923 who is
the Assistant Labour Commissioner or the Labour-cum-Conciliation Officer of the area where
the accident took place or where the claimant ordinarily resides or where the employer has his
registered office. After hearing both the parties, the Commissioner decides the claim.
Contracting out: Any contract or agreement whereby an injured person or his dependant
relinquishes or reduce his right to receive compensation is null and void to that extent

Appeal: An appeal lie to the High Court against the orders of the Commissioner with regard to
the awarding or refusing to award compensation, or imposing interest or penalty, or regarding
distribution of compensation etc.
Recovery: The amount of compensation awarded by the Commissioner is to be recovered as
arrears of land revenue.

288 LOVELY PROFESSIONAL UNIVERSITY