Navigating Delays: How to Ensure a Deceased Laborer's Family Receives Their Compensation Check

Hi All, please guide me in handling the critical situation. A laborer died in the year 2016. As per the WC Policy, a compensation check was prepared (although delayed by a year) for approximately Rs. 8 Lakhs, favoring the Deputy Labor Commissioner of the region and handed over to him. However, the LEO raised the point of delay and did not give the check to the victim's family. In between, the DD/Cheque expired, and we got it re-validated through the issuing bank.

Now the victim's family is ready to accept the check, but since the DD/Cheque is in the name of DLC, it cannot be handed over to them directly. It has to be submitted to the DLC, but then again, LEO may raise a point for the delay/impose a penalty for that or may ask for some favor for himself.

Kindly guide on how the compensation check can be given to the victim's family. Can an affidavit from the victim's family stating that they are ready to accept the check and have no objection if the payment is delayed suffice?

Please guide and suggest a way out.

Thanks and Regards,
Nitin Kandya

Compensation Under the Employees' Compensation Act, 1923

The amount in the form of a cheque drawn in favor of the E.C. Commissioner is the compensation under the Employees' Compensation Act, 1923. As such, why should you try to disburse it directly to the deceased's family instead of depositing it with the D.L.C.? How come the L.E.O. came into the picture?

I would like to invite your kind attention to the provisions of sec. 8 of the E.C. Act, 1923, which deals with the procedure for distribution of compensation deposited with the E.C. Commissioner. Under ss(4) of sec. 8, the Commissioner can conduct a dependent's enquiry in case of a multiplicity of claims by different people. For this purpose, he can utilize the services of subordinate officers like L.E.O. Therefore, the officers like L.E.O., if so directed by the Commissioner, have to conduct the enquiry and submit his report to the Commissioner, and it is none of his business to verify the correctness of the amount already deposited with the Commissioner.

Such being the legal position relating to disbursement of compensation in respect of any employee's death, your description is a bit confusing. Better calculate the interest amount at 10% simple interest from the date of death till the date of the deposit of the compensation amount and deposit the entire sum with the E.C. Commissioner.

Thank you, Umakanthan Sir, for always guiding us in the right way using very understandable language. As rightly advised by you, I am going to submit the compensation draft made in favor of DLC on the coming Monday with a prayer to pass the money to the victim's family. If, as per law, our company has to bear any penalty in the form of interest due to an inordinate delay in submitting the compensation amount, I will request the DLC to notify us about that through a letter/notice, and we will abide by the same.

I hope it works out, and there is no further delay in compensating the victim's family. Thank you very much for your guidance.

Take care,

Nitin Kandya
Lucknow

On reading your post, one can infer that there is insensitivity from both sides. From the company's side, due to the delay in the preparation of the cheque, and from the labor authority's side for raising objections to the delay and withholding the issuance of the cheque itself. In the crossfire between the two, the dependents of the deceased employee are held ransom.

If LEO had raised an objection to the delay, could you have replied that as of now, the compensation amount may be transferred to the dependents of the deceased, and additional compensation arising from the delay can be worked out separately? Did you do that? Have you made an appointment with ALC (or DLC as the case may be) to explain your position? His ruling could have hastened the disbursement of terminal benefits to the nominees of the deceased.

Lessons for HR Fraternity

Many companies conduct training on Time Management. However, most discussions center around personal time management, focusing on tools like "To-Do List" and "Prioritization." A major flaw is the lack of discussion on the organization's time. The whole issue has arisen due to the delay in the disbursement of the cheque to the nominee of the deceased employee. If there is a procedural flaw, it wastes a lot of time for the parties involved in the procedure. Apart from calculating the interest required to be paid due to the delay in cheque preparation, will anyone calculate the losses caused by the time spent addressing objections by the labor authorities? Nobody calculates these invisible losses!

Thanks,

Dinesh Divekar