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Calculating Workmen's Compensation

If we are to compute workmen's compensation:

1. We base it on the WC scale, which depends on the permanent incapacity ratio.
2. For death, the employee's salary is multiplied by 60 months (5 years) and by 100% to establish the compensation value.

From Uganda
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Workmen Compensation as per Employees Compensation Act in India

Workmen compensation in India is based on two factors: the age of the employee and wages. The Act has prescribed a schedule that contains a factor against age. In the case of death, this factor is multiplied by 50% of wages to calculate the amount of compensation payable. In the case of permanent total disablement, the factor is multiplied by 60% of the wages. The minimum amount of compensation for death is Rs 120,000, and for permanent total disablement, it is Rs 140,000. In the case of partial total disablement, the amount of total disablement is multiplied by the percentage of loss of earning capacity as provided in another schedule.

Wages for the purpose of calculation shall mean Rs 15,000 per month. There are differences of opinion about these wages. While some verdicts state that this is the maximum wage on which the compensation shall be calculated, others say that Rs 15,000 should be the minimum wage on which the compensation should be based. In the case of Jaya Biswal & Ors vs Branch Manager, Iffco Tokio General Insurance Co Ltd (AIR 2016 SUPREME COURT 956, 2016 LAB. I. C. 1614), the Supreme Court has stated that the Employees Compensation Act, being an employee-beneficiary legislation, should have compensation payable worked out on the basis of actual salary.

In the case of factories, all employees, including the Managing Director, would be covered. However, in the case of offices, shops, and commercial establishments, only certain employees as per schedule will come under the purview of the Act.

See the attachments.

From India, Kannur
Attached Files (Download Requires Membership)
File Type: doc WC Compensation schedule.doc (66.5 KB, 0 views)
File Type: pdf WC-Disablement rates.pdf (31.5 KB, 0 views)
File Type: pdf WC-Schedule II-Employees covered.pdf (43.6 KB, 0 views)

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Calculation of Compensation Under the Employees Compensation Act 1923

The Employees Compensation Act 1923 regulates the payment of compensation. Compensation is paid for three conditions: death, permanent disability, and temporary partial disablement.

Calculation of Compensation:

The employee's salary is ₹20,000, Age: 30.

1. Death: 50% of the wage multiplied by the factor 207.98.

2. Permanent Disability: 60% of the wage multiplied by the factor 207.98.

3. Temporary Partial Disablement: 25% of the wage multiplied by the factor and the loss percentage decided by the competent authority.

4. Compensation for Loss of Limb: Workers' compensation benefits for limb loss are calculated based on a combination of factors, including the injured worker's average weekly wage, the specific limb lost, and the applicable laws in their state. A "body chart" is often used to determine the number of weeks of compensation for each limb loss, which is then multiplied by a percentage of the average weekly wage.

Regards

From India, Mumbai
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  • CA
    CiteHR.AI
    (Fact Checked)-Your explanation of the Employees Compensation Act 1923 is accurate, and your breakdown of the compensation calculation is correct. Good job! (1 Acknowledge point)
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  • You have provided a comprehensive overview of how compensation is calculated under the Employees Compensation Act 1923. However, as you are located in Uganda, it's important to note that the labor laws in your country may have different regulations and parameters for calculating workmen's compensation.

    Uganda Workers Compensation Act 2000

    In Uganda, the Workers Compensation Act 2000 is the relevant legislation. The Act provides for compensation to workers for injuries suffered and occupational diseases incurred in the course of their employment.

    1. Death: According to the Act, if a worker dies as a result of a work-related accident, the employer is required to pay compensation equal to 60 months (5 years) of the worker's earnings.

    2. Permanent Disability: The Act provides for compensation in cases of permanent disability according to the degree of disability. The degree of disability is determined by a medical practitioner and compensation is paid based on the worker's earnings and the degree of disability.

    3. Temporary Disability: For temporary disabilities, the Act provides for compensation of half the worker's monthly earnings for the period of temporary disablement.

    4. Compensation for Loss of Limb: If a worker loses a limb in a work-related accident, the Act provides for compensation based on a percentage of the worker's earnings. The percentage is determined according to a schedule in the Act.

    For more detailed information, you may refer to the Workers Compensation Act 2000, which can be accessed at the http://www.ulii.org/ug/legislation/consolidated-act/225.

    It's always advisable to consult with a labor law expert or legal professional to understand the specifics of the compensation calculation as per the prevailing laws in your country. Moreover, practices can vary from company to company, and often, collective bargaining agreements or employment contracts may also influence the compensation.

    From India, Gurugram
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