Relevant Date For The Determination of Compensation Payable Under Employees Compensation Act, 1923 Is The Date of The Ac

This article deals with the observation made by the supreme court that the relevant date to pay compensation to the employee under the Employee Compensation Act, 1923 is the date of the accident.

Published On:
ASSN: 9408942

Every person on this Earth looks for assurance. This assurance comes in many forms such as security, protection, safety both monetary and non-monetary. Similarly, the employees also look for assurance. Every employee wants a secured job and compensation for whatever expenses he/she has paid on behalf or for the company or whatever damages he has incurred from the company. This is where the "Employee Compensation Act, 1923" or "Workmen Compensation Act, 1923"comes into play. This act provides compensation for the injuries that the employees have suffered while they were working. It is the duty of the employer to pay compensations for the injuries his employees have faced during their working hours. This act extends to the whole of India and is applicable to the employees covered under the definition of 'workman' as specified under the Act. It came into force on 1st July, 1924. This Act is administered by the Employees' State Corporation (ESIC) or the commissioner of Workmen's Compensation in different states.

Section 3 of the act talks of Employer's liability for compensation. It mentions that if a personal injury is caused to an employee by accident arising out of and in the course of his employment, his employer shall be liable to pay compensation in accordance with the provisions and if an employee under employment contracts any disease which comes under the category of occupational disease peculiar to that employment then the employer is bound to pay compensation to the employee. Part C of Schedule III of the act mentions that if an employee contracts a disease that is mentioned as an occupational disease which is specific to that employment, during a continuous period that is less than the period mentioned under this part of Schedule 3 is known as occupational diseases. It is deemed that the disease has arisen out of and in the course of the employment, the contracting of such disease will be deemed to be an injury by accident and compensation for the same is to be granted to the employee or his dependant. There are several kinds of accupational disases.Infra-red radiations, skin diseases due to chemicals processing units, hearing impairment caused by noise etc. are some of the occupational diseases for which the employer is liable to pay compensation to the employees.

The act also mentions when the employer is not bound to pay compensation which are as follows :

(a) in case of any injury which does not result in total or partial disablement of an employee to work for a period exceeding three days

(b) in case of any injury not resulting into death or permanent total disablement caused by an accident

(c) if the employee was working under the influence of drinks or drugs

(d) the willful disobedience of the employee to the orders explicitly given regarding safety measures

(e) the willful disregard of the employee of any safety guard or other device which he/ she knew was meant for his/her safety.

The Supreme Court had made several observations and ruling regarding the determination of compensation and most importantly regarding the relevance of date. The Supreme Court reiterated that the date of the incident plays a vital role in determining several reference points such as extent of the injury, disablement whether partial or total or death caused to the employee during the course of his employment.The Court has stressed that the date of the accident serves as the starting point for calculating compensation of the employee. Several factors such as the assessment of loss of income, medical expenses, and the impact on the employee's earning capacity affect the calculation of final compensation and it is advisable to consider it from the date of the accident. There were several instances where accidents were not reported timely. The delay in reporting might affect the impact and severity of the accident and medical evaluation which would furthur lead to wrong calculation of final compensation. In various judgements the Supreme Court has made observations regarding the date of the accident, medical evidence, and the impact of the injury or disability on the affected employee. In Vishnu Kumar Tiwari v. JCB India Ltd. Ors., Supreme Court made an observation on the date of the accident and its relevance in determining the compensation in an injury related to work.

There is a lot of relevance of the date on which the accident occurred. The severity of the injury and disability suffered by the employee is directly related to the date if the accident. Medical examination conducted immediately after the accident plays a pivotal role in determining the severity of disability caused. The date of the accident helps in calculating the loss of income. It helps in determining the period for which the employee was unable to work or might be unable to work in the future. In case of an employee's death, the date of the accident is essential in determining the compensation payable to the dependents. It helps in assessing the financial loss suffered by the dependents due to the untimely death of the breadwinner. There are statutory limitations regarding filing of a claim for the compensation. The date of the accident serves as a reference point whether the claim falls within the ambit of the stipulated timeframe.

There are several impacts of the delay in the reporting of the accidents. Firstly, delay in reporting might affect the availability and accuracy of medical evidence which is very necessary for assessing the extent of the injury or disability. Secondly, delay in reporting also leads to delay in processing of the claim, which further leads to financial hardships to the affected employees and their dependants.

The date of the accident plays a very significant role in determining the compensation payable to the employees or their dependents in case of injury, occupational diseases and even death because at times the impact of the injury is not same as it was at the time of the accident. Time of the accident acts as a reference points for various things such as the extent of injury, loss of income of the employee and calculation of the compensation of the employee.


  1. Dinesh Singh Chauhan, "Relevant date for the determination of Compensation Payable Under Employees' Compensation Act, 1923, Legal Services India E- Journal.
  2. Madhuri Pilania," The Employee Compesation Act, 1923", I- Pleaders
  3. https://labour.gov.in/sites/default/files/ec_act.pdf