Workplace Accident: How Should I Handle Compensation Demands from an Injured Worker?

Dear members,

I am working in a manufacturing company. Here, one of my laborers met with an accident while working in the factory premises and lost the top portion of his ring finger. We took him to the hospital, where he underwent all necessary surgeries and received medication. Now, after two surgeries, he is okay but is demanding compensation.

As a fresher, I seek your guidance on the following:
1. For how much compensation are we accountable?
2. How can I resolve this issue?

Your assistance in this matter would be greatly appreciated. Thank you.

Is the company/worker covered under the ESI Act? If so, the management is not liable. If not, the management needs to pay compensation as per the Workmen Compensation Act. Please go through the same and clarify. To take care of all these types of issues, it is better to obtain a policy (Workmen Compensation Policy) from any insurance company so that the compensation part is taken care of.

Before paying the compensation, you should also obtain information on whether the accident occurred due to his/her negligence. If so, document the case. If it can be proved, then there is no liability on the management. However, if the case is taken to the Factory Inspectorate/Labour Department, they may ask you to pay the compensation. Check all the above points and clarify.

Thanks and regards,
Kameswarao

Dear,

Legally, you should have raised an accident report, and this compensation should be obtained from ESI. The company is not bound to pay any compensation if he is a member of ESI. If he is not a member of ESI, then the Workmen Compensation Act will be applicable to him, and the WM Commissioner will decide the claim.

Thanks,
JS Malik

Mr. Kameswarao has rightly suggested for payment of compensation to the injured person. As per your version, this accident happened in due course and out of employment in your factory, considering the loss of earning capacity, age of the employee, and wages per month. If you are covered under the ESI Act, 1948, in that case, the benefit is to be given by the ESIC. However, it seems that you have not sent the accident report to the factory wing of the Labour Dept. and to the ESI local office/authorities concerned. If the answer is negative, then it is suggested that due compensation may please be given to the employee as per the provisions of the Workmen's Compensation Act, 1923 to solve the problem. It is also noted that the amount spent on the treatment of the employee is not adjustable in the compensation amount.

Labour is right in asking for compensation because his finger has been damaged due to the negligence of the employer.

As my friend Malik rightly said, if your plant or operations are not registered under ESIC, you have to decide on compensation as per the Workmen's Compensation Act.

Badlu

Dear Neha,

Malik sir is right. You should submit the accident report in Form 16 as early as possible. The ESIC inspector will examine the place of the incident.

Regards,
Vipin

As per the Workmen's Compensation Act, you will have to provide compensation for the employee considering the magnitude of importance of his finger. Check whether this is a permanent total disablement, partial disablement, or temporary disablement. Accordingly, the compensation changes. The salary has to be multiplied by the relevant factor specified as per the type of injury and it has to be paid.

If you have insured the person under a Workers' Compensation insurance policy, then they would take care if it is not because of the employer's negligence. The possibility of any accident could be either because of an unsafe act or an unsafe condition. An unsafe act is committed by the negligence of the employee, and an unsafe condition is due to the employer's negligence of safety. This will be determined by the Workers' Compensation Commissioner either based on a personal visit or based on reports and evidence.

Insurance will be paid by the insurance company only for an unsafe act, and you will have to pay compensation for an unsafe condition.

Regards,
Srivallaban

Dear Friend,

Not only within the purview of ESIC, but you also have to inform the concerned Inspector of Factories Office as well. However, Mr. Malik says it is 100% correct, of course.

Regards,
PBS KUMAR

Dear all,

1. What is the date and time of the accident? Was it in the due course of employment?
2. Is the Factory covered under ESIC?
3. What were his gross wages on the date of the accident? Was the employee who had met with the accident covered under ESIC, and were contributions deducted and paid to ESIC?
4. In case he has been covered under ESIC, has the Accident Report in Form No. 16 been submitted to the concerned ESIC Office?
5. If he is coverable under ESIC, please submit F.16 immediately to the concerned ESIC authorities. The injured employee is entitled to substantial temporary and permanent benefits from ESIC, and we should not forfeit them due to our ignorance or inefficiency.
6. Otherwise, report the accident to the Inspector of Factories immediately. This will facilitate the payment of Workman compensation in case ESI benefits do not apply.

A. Irudayam
Advocate and HR Consultant
+9199406 86632

Dear Mr. Malik & Mr. Irudayam,

The statement is correct. However, before compensating him, please ensure to check it as the implications may not be in favor of the employer.

Regards,
Chitragya

Thank you all for your guidance.

Yes, he is a member of ESI. We have also submitted the accident report to ESI. However, now he wants to claim for the period he was on rest (1 month salary) because of negligence; he did not update his recovery period to ESI. Now, ESI is not ready to give such a claim as he is late.

In such a situation, is there any liability on the company for such a period? Moreover, on his request, one of the ministers called me for his compensation.

Hi Neha,

You are safe as the company is covered under ESI, and the accident report has been submitted. ESI cannot, in any case, deny him benefits! He was operated on by ESI, and ESI has to provide him with the rest period salary. Just contact the manager of the local branch, and if the problem is still not solved, then meet with the ESI inspector. If the issue persists, file a written complaint with the ESI head office. Also, inform the minister to help in obtaining the benefits for the employee through ESI (a government body created for this purpose).

Regards,
Manish Gupta