Give the list of cases when the Employer is not liable to pay Compensation.

Question: Give the list of cases when the Employer is not liable to pay Compensation.

Find the question and answer of Labour Law only on Legal Bites. [Give the list of cases when the Employer is not liable to pay Compensation.]

Answer

The “Employees Compensation Act, 1923” was enacted to provide payment in the form of compensation by employers to employees for any injuries suffered in an accident. It is one of the earliest labour welfare and social security legislation enacted in India. Earlier this Act was known as the Workmen Compensation Act, 1923. It was named as Employee’s Compensation Act on 18th January 2010 as now employees in clerical capacity are also eligible for compensation.

To be eligible for the benefits under the Employees’ Compensation Act, the following requirements need to be fulfilled:

• The person must be an employee of the Company or Organisation.
• The person must have been injured at the workplace in the course of employment.

Section 3(1) of the Employees' Compensation Act, 1923 mandates that an employer shall be liable to pay compensation to an employee who suffers an injury or contracts an occupational disease arising out of and in the course of employment. However, there are certain exceptions to this rule where the employer is not liable to pay compensation.

As per Section 3(1) of the Employees Compensation Act, 1923, the employer is not liable to pay compensation in the following cases:

1. If the injury does not end in the entire or partial disablement of the employee for a period exceeding three days.

2. If the injury, not leading to death or permanent total disablement, is caused by an accident which is directly attributable to:

a) The employee at the time of the accident is under the influence of drink or drugs;

b) The wilful disobedience of the employee to an order if the rule is expressly given or expressly framed, for the purpose of securing the safety of employees; or

c) The wilful removal or disregard by the employee of any safety guard or other device which has been provided for the purpose of securing the safety of employees.

Overall, the exceptions to this general rule where the employer is not liable to pay compensation are discussed in the points below:

Self-inflicted injury: If an employee suffers an injury due to his own deliberate act, then the employer is not liable to pay compensation. For example, if an employee jumps from the roof of a factory building, the employer cannot be held liable for any injury sustained by the employee.

Injury not arising out of employment: If an injury suffered by an employee does not arise out of and in the course of his employment, then the employer is not liable to pay compensation. For instance, if an employee meets with an accident while travelling to or from work, the employer may not be held liable for such an injury.

Willful disobedience: If an employee disobeys a lawful order of the employer and suffers an injury, the employer is not liable to pay compensation. However, if the disobedience was due to a reasonable cause or if the order was unlawful or dangerous, the employer cannot escape liability.

Intoxication: If an employee suffers an injury while under the influence of drugs or alcohol, the employer may not be liable to pay compensation. However, if the employer had knowledge of the employee's addiction and failed to take appropriate action, he may be held liable.

Injury caused by a third party: If an employee suffers an injury due to the negligence of a third party, the employer may not be held liable. However, if the third party is an agent or a contractor of the employer, the employer may be liable for such an injury.

Pre-existing condition: If an employee suffers an injury or an occupational disease due to a pre-existing condition that was not aggravated by his employment, the employer is not liable to pay compensation.

Act of God: If an employee suffers an injury due to an act of God such as an earthquake or a flood, the employer may not be held liable for such an injury.