Workmen's Compensation Act of 1923

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Definition and History:

The Indian Workmen's Compensation Act of 1923, put into effect on 1st July 1924, provides social and employment injury security for Indian workmen, uncovered by the ESI Act, and employed in hazardous industries such as mining, factories, plantations, etc. Workmen may claim damages unless damages were caused under influence of drugs or alcohol, or the workman is claiming damages in a civil court. The type of compensation is divided into four areas:


The amount compensated is calculated by multiplying 50% of last wages by a relevant factor or Rs. 60,000 whichever is more.

Permanent total disablement:

The amount compensated is calculated by multiplying 60% of wages by a relevant factor or Rs. 60,000 whichever is more.

Permanent partial disablement:

A list of injuries is provided by the part II schedule I of the Act. Compensation is percentage of the equivalent permanent disablement as listed in section 4 [(1)c(i)]. Non-scheduled injuries are paid according to permanent total disablement as under schedule I of assured by a physician. The amount of compensation is totaled for multiple injuries.

Temporary disablement (Partial/Total):

Compensation is paid as a bimonthly sum equivalent of 1/4th of the employee's monthly income as described in section 4(1)(d).

My Personal Opinion:

Usefulness of Workmen's Compensation Act - 1923:

I think that all of India's welfare programmes are welfare oriented. However, I find the Workmen's Compensation Act - 1923 very useful. I truly admire India's industrial workers. Many of these labourers have families dwelling in rural areas, nevertheless, these labourers venture out into the cities looking for work so that they can send their children to better schools and provide better healthcare to their elderly. These labourers overcome the language and cultural barrier, and have moved away from their families to live in big modernized cities that may seem foreign to them. They do all this so that they can have a better life. It should be noted that many times, the male industrial workers may be the only working member of the family, and their injury at work could give rise to drastic consequences. The labourer's children may leave school and start doing menial jobs, and the labourer's other dependents may be forced to look for work or even resort to begging.

Role of Workmen's Compensation Act - 1923:

Here is when the Workmen's Compensation Act - 1923 comes into play. Injuries in industrial settings are commonplace. It is imperative that the government pay special attention to the health of industrial workers because workers are the framework of all industry. Industry wouldn't function without them. The Workmen's Compensation Act - 1923 was approved in March 1923 and was effective beginning 1st July 1924 and, at present, covers all workers employed in Indian industries. It should be noted that "workman" applies to labourers involved in physical labour industries such as factories such as mining, factories, plantations, and heavy construction.

The Lay-Off Act:

I would like to introduce a Lay-off Act concerning workers that are getting laid-off from work. In our increasingly globalized and highly competitive economy, businesses are hardly ever stable. Companies are constantly growing or shrinking, or are facing barriers that keep them from growing. One of the biggest challenges companies must face is having a workforce that is skilled enough to allow them to innovate and compete, and ultimately grow and prosper, in this economy. These could be the main function of the Lay-off Act:

1. Higher productivity and worker morale and lower absenteeism during layoff event due to reduced stress.

2. Lower unemployment insurance costs as workers are re-employed more quickly when services are begun prior to layoff.

3. Decreased likelihood of sabotage or work disruptions.

4. Media and rumor management. Rapid Response teams understand the often confidential nature of layoffs, and will work with the company to ensure confidentiality at all times.

5. Better public relations for an employer. Rapid Response teams can also work with the media to highlight services an employer is providing to its workers during a layoff period, which will improve a company's public image.

Additional Readings:

1. Define the term 'Labor Welfare'
2. Theories about Conceptual Frame Framework of Labor Welfare
3. Basic Principles of successful Labor Welfare Programs
4. Explain the Factories Act of 1948
5. Explain the Employee’s State Insurance Act of 1948
6. Explain the Employee’s Provident Fund and Miscellaneous Provisions Act of 1952
7. List and Functions of Organizations that monitor Labor Welfares
8. Workmen’s Compensation Act of 1923
9. Employees Pension Scheme of 1995
10. Payment of Gratitude Act of 1972
11. Social Security System
12. Maternity Benefits Act of 1961
13. Welfare Measures at the Tata Iron and Steel Company

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