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Unit 9: Social Security Legislations

9.2 Employer's Liability for Compensation Notes

The liability of an employer to pay compensation is limited and is subject to the provisions of
the Act. The liability of the employer to pay compensation is dependent upon the following four
conditions:
1. Personal injury must have been caused to a workman;
2. Such injury must have been caused by an accident;

3. The accident must have arisen out of and in the course of employment; and
4. The injury must have resulted either in death of the workman or in his total or partial
disablement for a period exceeding three days.

The employer shall not be liable to pay compensation in the following cases:
(a) If the injury did not result in total or partial disablement of the workman for a period
exceeding three days;

(b) In respect of any injury not resulting in death or permanent total disablement, the employer
can plead:
(i) that the workman was at the time of accident under the influence of drinks or drugs;

(ii) that the workman willfully disobeyed an order expressly given or a rule expressly
framed for the purpose of securing the safety of workmen; and
(iii) that the workman having known that certain safety-guards or safety devices are
specifically provided for the purpose of securing the safety of workman, willfully
disregarded or removed the same.
The employer can succeed in his plea, only if he can establish that the injury was attributable to
any one of the above factors.

(i) Occupational Diseases: The list of the occupational diseases is contained in Schedule III of
the Act. Schedule III is divided into three parts, A, B and C. The disease contracted must be
an occupational disease peculiar to the employment specified in Schedule III. In respect of
every such disease mentioned as occupational disease in Schedule III, a list of a number of
employments is given. To support any claim for compensation in case of occupational
disease in Part A, no specified period of employment is necessary; for diseases in Part B,
the workman must be in continuous employment of the same employer for a period of six
months in the employment specified in that part; and for diseases in Part C, the period of
employment would be such as is specified by the Central Government for each such
employment, whether in the service of one or more employers. The contracting of any
disease specified in Schedule III shall be deemed to be any injury by accident, arising out
of and in the course of employment, unless the contrary is proved.
(ii) Personal injury: Injury ordinarily refers to a physiological injury. Personal injury does
not mean only physical or bodily injury but includes even a nervous shock, a mental
injury or strain, which causes a chill. It is a term wider that bodily injury. In Indian News
Chronicle vs. Mrs. Lazarus, a workman employed as an electrician had frequently to go to
a heating room from the cooling plant, catches pneumonia and dies after a short illness of
five days. The Court held that the injury caused by an accident is not confined to physical
injury and the injury in this case was due to his working and going from a heating room
to a cooling plant as it was his indispensable duty.

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