Updated: Thursday January 14, 2010/AlKhamis Muharram 29, 1431/Bruhaspathivara Pausa 24, 1931, at 07:11:48 PM

Course Contents:

1.      The Workmen’s Compensation Act, 1923 (as amended upto date).

Book Recommended:

1.      Labour Code of Pakistan by Muhammad Shafi and Pervez Shafi.

This law deals with the payment of compensation by the employer to worker or workman (not officer) when he meets with an accident during his working period. Natural disabilities are excluded from the compulsory payment of compensation. Occurrence of accident after the working hours in outside the working premises is also excluded from the payment of compensation. Only such accident is covered under this law which occurs due to work for which worker is employed.

Adult: Generally the person who attains the age of eighteen in general or twenty one in case where Court appoints guardian for person or his property becomes adult. But so far as the Workmen’s Compensation Act is concerned, the minor is below than fifteen (15) years of age and adult is the person who has attained the age of fifteen (15) years. This is a special law and where special law provides other than of general law, provisions of the special law prevail. Special law suspends the general law.

Dependant (O»B°· jÍk): Following are the dependants of the worker for the payment of compensation:

1.            Widow where husband dies. Previously the word wife was used as dependent.

2.            Minor legitimate son. Here again minor means a person whose age is less than of fifteen years.

3.            Unmarried legitimate daughter. Age is not defined. She remains dependent even she goes to forty year of age without marriage.

4.            Widowed mother.

5.            Widower where wife dies.

6.            Parents other than a widowed mother.

7.            Minor illegitimate son. Age of majority remains the same as previous, i.e., fifteen years.

8.            Unmarried illegitimate daughter.

9.            Daughter either legitimate or illegitimate and minor after death of her husband is also considered dependent of the worker.

10.        A minor unmarried brother. Age of majority for the purpose of workmen’s compensation remains the fifteen years.

11.        Unmarried or widowed sister.

12.        Widowed daughters in law (ĚČI ĘĚÎI). After death of son of worker, widow of son remains the dependant to worker.

13.        Orphan grandson.

14.        Minor of the deceased daughter where her husband has also been died.

15.        Paternal grandparent where parent of workman have been died.

Workmen’s Compensation – employer’s liability for compensation u/s 3: The liability of an employer is confined to payment of compensation to someone who is a “workman” within the meaning of the Act, and then only in respect of an injury caused by “accident arising out of and in the course of his employment”. The important words being “employed”, “workman”, “accident”, “arising out of”, and “in the course of employment”. A workman claiming compensation must prove two things, i.e., that the accident arose out of his employment, that is to say that his employment was distinctive and the proximate cause of his personal injury and that it occurred in the course of employment.

An injured workman has two alternative remedies, i.e., either he may proceed under the Workmen’s Compensation Act in which case any suit for damages will not be maintainable in any Court of law, or he may sue his employer for damages in an ordinary Court in which case he forfeits his rights under the Workmen’s Compensation Act. He may choose whichever suits him better. But if proceeding is under the Workmen’s Compensation Act, he is finally held not to be a “workman” he can still sue the employer for damages in a Civil Court by making use of the Limitation Act to avoid the difficulty of time bar if he can show that he was pursuing a supposed remedy in another jurisdiction.

Employer’s liability: Under the Act, liability of employer is an absolute nature and payment of compensation is limited by ceiling fixed in Schedule to the Act. Claim of compensation is distinguishable from claim in tort as in latter case injury arises out of employer’s negligence as well as compensation payable is fixed by Court not subjected to any limit like that of Schedule.

Injury while going to work by transport provided by employer, implication that there was an obligation on the part of the employer to provide the transport, and there was equal an obligation on the part of the workman to make use of the transport, the injury occurred out of and in the course of employment.

Where employer is exempted from payment of compensation: Following are the circumstances under which liability of the employer extinguished for the payment of compensation:

1.      When liability arises: When injury is caused to workman in the course of employment.

2.      Conditions of the injury: s

a)      Injury to workman: s

b)      Within the course of employment: s

c)      Exceeds four days: s

3.      Exclusions: Followings are excluded from the injury:

a)      Total disablement:

b)      Short period of injury: Where period of injury is less than provided under law, i.e., four days, liability of employer extinguishes. It covers both total and partial disablement.

c)      Partial disablement:

d)     Injury not resulting death by accident:

e)      Injury under drink: Injury during voluntary intoxication: If workman gets injury during the use of intoxication or drug, which is voluntary, employer is not liable to pay compensation.

f)       Injury under drugs:

g)      Willful disobedience as to safety rules: Where employer has indicated the “restricted area” not for the use of common workers, and worker goes there and gets injury, is not covered under this law. This disobedience must be willful and not mere disobedience.

h)     Willful removal of safety guards: Where employer has provided safety devices for the protection of workman from injury and workman removes them without any sufficient cause, shall exempt employer from the payment of compensation if injury occurs.

i)       Where suit for damages has been instituted:

Distribution of compensation u/s 8: Where workman has been died and his dependant includes legal disable or widow, payment of compensation shall not be made directly to them but through Commissioner. This provision is made to protect the interest of the dependants who are not able to retain compensation for better use.

Employer can make payment directly to the dependants of deceased workman not exceeding to Rs. 100/-. This amount is deductible from the sum of amount of compensation. Commissioner deducts this advance payment from the amount of compensation and it is repaid to employer.

Any amount of compensation, which exceeds to Rs. 10/-, shall be paid to dependants of workman through Commissioner. Employer shall deposit such amount to Commissioner.

Where working lady suffers from legal injury, Commissioner may segregate the amount of compensation making half payment to the person suffering and half is invested to receive benefits of it permanently. Investment protects her interest as against the greedy members of her family.

Where dependants are legally disabled, amount of compensation is not directly made to them, but Commissioner decides whether as to how compensation is paid to them. Employer cannot make such payment them directly.

Where employer makes payment of compensation to legal heir in case of the death of dependant and obtains receipts, these receipts are not legally entertain-able as valid receipt and payment of compensation. It can be challenged in Court of law. Only Commissioner is competent authority to distribute such amount of compensation.

Where amount of compensation exceeds to Rs. 300/- shall be paid to dependants through Commissioner. Employer cannot make such payment directly, if so, shall be null and void in the eyes of law.

Funeral expenses made to the legal heirs directly by employer can be deducted from the total amount of compensation later on.

Where Commissioner pays the amount of compensation to dependants, he issues its receipts to both dependants and employer, which are conclusive proofs of the payment of amount of compensation.

Employer is layman and not aware as to who is dependant of the deceased workman. What is definition of dependant? Who are legal heirs? This all rests to Commissioner.

As and when Commissioner receives the amount of compensation from employer for distribution, he makes a notice to the dependants of workman. He also may notify through advertisement in newspaper. Dependants or legal heirs, as the case may be, apply to Commissioner for the receipt of amount of compensation.

Where no claimant comes to receive the amount of compensation, Commissioner may remit the amount of compensation to employer. Employer cannot use this amount for any other purpose other than the welfare of fellow workmen of deceased workman. This happens where workman has neither dependants nor legal heirs.

Where during the course of pendency of the case to determine the dependants, a dependant dies, amount of his share shall be distributed to his legal heirs, if alive. Law of Succession governs such distribution. Where dependant dies after receiving the amount of compensation, Succession Act shall govern his estate.

Compensation not to be assigned, attached, or charged u/s 9: Amount payable to workman either monthly or half monthly not to be assigned, attached, or charged other than where law permits.

Notice and claim u/s 10: Where accident is occurred, it is obligatory on the part of employee or employer to convey such occurrence to the Commissioner otherwise claim shall not be made to the worker.

Person keeping management shall serve notice, which shall include name of the person injured, his address, cause, and date of injury.

Medical examination u/s 11: Worker is bound to inform his employer for the causation of injury within three days. Employer is required to appoint a doctor for his treatment. Worker is also under liability to convey the occurrence of injury. Workman injured has to present himself for the medical examination and following rules shall govern his treatment:

1.      As soon as the injury is reported to employer, employer is required to appoint a qualified medical practitioner to examine the injured workman within three days of the injury. Workman shall also present himself for examination from time to time prescribed by such doctor. Where workman fails to submit himself for treatment despite the fact that employer has appointed the qualified doctor, employer shall not be liable. Where doctor could not be appointed or due to reasons certain workman could not present himself to the doctor prescribed, employer shall reimburse all the medical expenses borne by the workman. Workman is not required for any unnecessary frequent visits. Unnecessary expenses are not reimbursed under this Act. Compensation is started from the date when he produces himself to doctor.

2.      Where workman fails to submit himself before prescribed doctor, reimbursement for such period shall not be paid unless he produces himself before the doctor prescribed. Only authorized intervals are covered under this law.

3.      Where worker is bound by law to produce himself within stipulated time period and he fails to do so, his right of compensation shall be suspended unless he produces himself.

4.      Where death is caused to workman during unauthorized absence, decision shall rest to Commissioner for the payment of compensation.

5.      Where unauthorized absence of workman commences within the waiting period, it may be enhanced. Waiting period is three months. If workman produces himself in such period, compensation shall remain continue.

6.      Where workman deliberately avoids producing himself to prescribed doctor and minor injury is converted into major injury, compensation for only minor injury shall be applicable. It is to avoid blackmailing on the part of workman.

Contracting u/s 12: If a company carrying on the business of manufacturing goods requires a factory for performing the manufacturing process and the factory requires a chimney, the work of seasonal repairs to the chimney by a contractor is not a part of the ordinary trade or business of the company.

Accident should took place in the factory premises or on the place which is used for the carrying on the business of enterprise.

Compulsory group insurance u/s 13 – B: This is liability of the employer:

1.      Liability of the employer:

2.      All permanent workmen are covered:

3.      When claim arises:

a)      Natural death:

b)      Natural disability:

c)      Partial disability:

d)     Injury:

4.      Liability to pay: Following can be held liable under different circumstances:

a)      Insurance company:

b)      Employer:

5.      Amount of insurance: Minimum coverage required under law is Rs. 200,000/- per worker.

6.      Where is no insurance: Liability transfers to employer.

7.      Payment to whom: Amount of insurance is paid to the following persons:

a)      To heirs: Where worker is died.

b)      To workman: Where he injures.

8.      Recovery under Workmen’s Compensation Act:

Insolvency of employer u/s 14: Compensation is presumed debt on employer where company is wound up.

Liability of the employer shifts to insurance company. Where insurance is not made out, liability remains with the employer.

Where insurance is made out, liability of the payment of compensation shifts to insurance company.

Where Company has paid fewer premiums to insurance company; remaining amount receiver shall pay to worker. Insurance company is liable upto the extent of payment of premium. Rest liability rests to employer, which is discharged by the receiver.

Appellate authority against compensation: Following the authority and appeal-able orders u/s 30:

1.      Tribunal: s

2.      Appeal-able orders: Following the appeal-able orders:

a)      Order awarding compensation: s

b)      Disallowance of claim: s

c)      Refuse to allow compensation: s

d)     Order to distribute compensation: s

e)      Allowing indemnity claim: s

f)       Disallowance of indemnity claim: s

g)      Refuse to register memorandum: s

3.      Conditions of appeal: Following are the conditions of appeal:

a)      Legal point:

b)      Where are consents:

c)      Disability of employer for appointment:

4.      Limitation: Sixty days are provided for appeal.

5.      Applicability of Limitation Act: Section 5 is applicable in such a case.

Judicial powers of Commissioner u/ss 22 – A, 23, and 27: Following are the powers:

1.      Require further deposit on fatal accident:

2.      Award against employer:

3.      Powers of Code of Civil Procedure:

4.      Taking evidence on oath:

5.      Enforcement of attendance of witnesses:

6.      Compel to produce documents:

7.      Compel to produce material object:

8.      Powers u/s 195 of Code of Criminal Procedure:

9.      Investment of compensation:

10.  Try other offences:

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