Page 63 - DMGT306_MERCANTILE_LAWS_II

Mercantile Laws – II

Notes payment of compensation, no suit can be filed in the civil court. Thus the workman has to choose
between two reliefs
(i) civil suit for damages and

(ii) claim for compensation under the Act. He cannot have both.
In a civil suit for damages, it is open to the employer to plead all the defenses provided by the
law of Torts. Therefore, a civil suit is a risky procedure for a workman and is rarely adopted. The
legal position of workmen has, however, been improved by two Acts, viz., the Indian Fatal
Accidents Act of 1855 and the Employers’ Liability Act of 1933.

Self Assessment

State whether the following statements are true or false:

7. The employer was liable to pay compensation only if he was guilty of negligence.
8. According to this Act, the employer is not liable to pay compensation irrespective of
negligence.

9. In a civil suit for damages, it is open to the employer to plead all the defenses provided by
the law of Torts.

3.4 Amount of Compensation (Section 4)

Section 4 of the Act prescribes the amount of compensation payable under the provisions of the
Act. The amount of compensation payable to a workman depends on:

(1) The nature of the injury caused by accident.
(2) The monthly wages of the workman concerned, and

(3) The relevant factor for working out lump-sum equivalent of compensation amount as specified
in Schedule IV (as substituted by Amendment Act of 1984).

There is no distinction between an adult and a minor worker with respect to the amount of
compensation. New Section 4 (as substituted by the Amendment Act of 1984) provides for
compensation for:
(1) Death;

(2) Permanent total disablement;
(3) Permanent partial disablement; and

(4) Temporary disablement – total or partial.

3.4.1 Compensation for Death

Where death results from an injury, the amount of compensation shall be equal to 50 percent of
the monthly wages of the deceased workman multiplied by the relevant factor, or 85,000
whichever is more. The formula for calculating the amount of compensation in case of death
resulting from an injury will be as follows:
50 Monthly wages Relevant factor


or 80,000 whichever is more.
100

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