ronak (mr)     16 May 2011

# labour accident

labour accident in small scale  industry with around 5 workers are working in which one labour hand accidently came in machine due to which his two fingers are cut from hand.

now according to workmen compensation act 1923

His salary is around Rs 3500

And according to schedule I part 2   workmen compensation act 1923 (amendment 2009)

Compenation = 20% of loss of earning capacity

His age is around 20 years, and he is working for around 6 months before accident

My question is how to calculate earning capacity

what is the formula or criteria to decide the compensation of earning capacity

thanks

to claculate the earning capacity you have to lead the evidence of the doctor who can say the disability to the body of a person so on that base you can calculate it.

to claculate the earning capacity you have to lead the evidence of the doctor who can say the disability to the body of a person so on that base you can calculate it.

ronak (mr)     16 May 2011

doctor says his first two fingers(index finger and middle finger) of right hand are cut down

and his ring finger of right hand they have inserted a rod in it.

but suppose if doctor say his disability to around 20% then how to calculate his earning capacity as hi is only 20years  age

Is there any criteria or on the discretion of court to decide the compensation.

It is wrong to confuse disability with earning capacity.Loss of earning capacity would depend on the type of work performed prior to accident and capacity to perform same work post accident.The schedule merely gives extent of physical disability,and in absence of any further evidence,it would be minimum compensation payable.It is possible that loss of earning capacity may be 100% even though disability in % may be much  less.

As far as calculation is concerned,one has to see payable compensation for that age in case of total permanent compensation and then calculate the payable amount on the basis of % disability.This is explained in sec 4 of the Act.

radha krishna (vp-hr)     21 May 2011

Schedule I Part II Serila Number.9:- 20% is loss of earning capacity.

Age: 20 Years.

Relavant factor as per Schedule IV: 224

Sec 4 (b): 60% of wages (Rs 3,500 X 60%) =Rs 2100

Compensation Payable : Relavant factor X 60% wages X Loss of earning capacity % = Rs 2100 X 224X20%= Rs 94080.

As per the Employees Compensation Act 1923 there is no need to go for doctor's certification if there is no dispute over the gravity of the injury. Sometimes it is required when there are multiple injuries/Worker claimsmore incapacity than what is  calculated by teh Management.

Please ensure that the compensation is paid through the Workmen's Compensation Commissioner by depositng the same by way of DD and submitting the same by filing form D. If pay directly to the worker, it will not be considered as compensation paid under the Act.