For any employer, the key resources that keep his business going are his employees or the working force. Henceforth, it is essential that he provide them with safe and healthy working environment. In any unforeseen event where, the employee had to face any bodily injury or death during the course of his employment, the employer will be responsible to pay him compensation under the Employee Compensation Act 1923.
What is Workmen Compensation?
Workmen Compensation Insurance provides legal liability coverage for compensation to employees for any occupational hazard, bodily injury or death caused by accidents during the course of employment. Obtaining the workmen compensation insurance is the primary method by which an employer can show his capability of securing the responsibilities imposed by his workforce. Workmen compensation is a remuneration payable under a scheme put forth by the Workmen Compensation Act of India, closely supervised by the Ministry of Labour.
Workmen Compensation Insurance covers the legal liability of the employer under the below scopes:
Table ‘A’ – Protection against legal liability to all employeesunder the Workmen Compensation Act 1923 and subsequent amendment to the said Act prior to the date of issue of the policy, the Fatal Accidents Act 1855 and at Common Law.
Table ‘B’– Protection against legal liability under the Fatal Accidents Act, 1855 and Common Law (Table ‘B’ policy may not cover employees who fall within the definition of Workmen under the Workmen Compensation Act 1923 as revised)
Any employer who does not see the employee as just workmen but a valuable asset or resource often take up this insurance policy. The premium for Workmen Compensation Insurance depends on the occupation and wages of workmen. The total sum insured is calculated by taking into account wages, salary, over time, lodging and other privileges, PF etc.
What does Workmen Compensation cover?
- Death
- Temporary disablement
- Permanent total disablement
- Permanent partial disablement
- Legal cost and expenses sustained with company’s consent
What Workmen Compensation does not cover?
- Injury that is not fatal or resulting in partial disablement not exceeding three days
- First 3 days of disablement and where the total disablement is less than 28 days
- Non-fatal injury caused by accident related to:
- Alcohol or drugs
- Disobedience of order where safety was a concern
- Removal and not using safety harness or devices
- War and nuclear perils
- Occupational diseases
- Liability of insured assumed under agreement
- Liability to employees of contractors of the insured (except distinctly declared and covered)
Risks involved if Workmen Compensation is not covered
Any employer has to make sure that his employees are in safe hands regardless of the potential hazards involved in the occupation. A fatal accident which can even result in death while in the premises of the employer can result in him being sued for his negligence by the employees. To gain the trust and confidence of the employees Workmen Compensation must be made available to all employees.
