Rajya Sabha passed Employee’s Compensation (Amendment) Bill, 2016

parliament CompensationThe Rajya Sabha on 22 March 2017 passed the Employee’s Compensation (Amendment) Bill, 2016. The amendment bill, which was passed by the Lok Sabha on 9 August 2016, seeks to amend the Act, 1923. Primarily, the proposed Act aims at providing payment of compensation to employees and their dependants in the case of injury by industrial accidents, which include occupational diseases.

Duty to inform employee of Right to Compensation: The Bill mandates employers to inform the employee of his right to compensation. Moreover, such information must be given in writing (in English, Hindi or the relevant official language) at the time of employing him.

Penalty for failure to inform: The Bill penalises an employer if he fails to inform his employee of his right to compensation under the Act. The Bill prescribes penalty for such offences between Rs 15,000 and Rs 1,00,000. Appeals from the Commissioner’s order: The Act, 1923 provides that any dispute related to an employee’s compensation will be heard by a Commissioner, who is bestowed with the powers of a civil court.

Appeals from the Commissioner’s order, related to a substantial question of law, will lie before the High Court concerned. Further, the Act, 1923 stipulates that appeals can be made against orders related to compensation, distribution of the amount, award of penalty only if the amount in dispute is at least Rs 300. The Bill, 2016 raises this amount to Rs 10,000. And, it permits the Union Government to further raise this amount.

Withholding payments pending appeal: Under the Act, 1923, if an employer has appealed against a Commissioner’s order, any payments towards the employee can be temporarily withheld. Further, the Commissioner may do so only by an order of the High Court, until the matter is disposed of by the Court.  The Bill, 2016 deletes this provision.

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