Chapter 01: Introduction
The Workmen’s Compensation Act is the first piece of legislation towards
social security. It deals with compensation for workers who are injured in the
course of duty. The scheme of the Workmen’s Compensation Act is not to
compensate the worker in lieu of wages.
The general principle is that a worker who suffers an injury in the course of
his employment, which results in a disablement, should be entitled to
compensation and in the case of a fatal injury his dependants should be
compensated. Under the Workmen’sCompensation Act it is the employer who
is responsible to pay compensation.
The meaning of compensation in this Act is limited to compensation granted
under the Act for employment injuries sustained during the course of work. It
is also limited to specifically monetary compensation other than a salary,
travel allowance, and any other form of remuneration that could be paid
under normal circumstances of employment.
To get an overall understanding of the Act it is useful to look at the “Statement
of Objects and Reasons’ published with the Act when it was first passed in
An additional advantage of a legislation of this type is that by increasing the
importancefor employersof adequatesafety devises, it reducesthe number of
accidents to workmen in a manner that cannot be achieved by official
inspection. Further, the encouragement given to employers to provide
adequate medical treatment for their workmen should mitigate the effects of
such accidents as does occur. The benefits so conferred added to the increased
sense of security, which he will enjoy, should render industrial life more
attractive and thus increase the available supply of labour. At the same time a
corresponding increase in the efficiency of the average workmen may be
Nowadays the government (State of Central) may extend the application of
this Act to other establishments of an industry that may not be organised.
The whole area of compensation of a worker for injury by accident was dealt
with by the Workmen’sCompensation Act, 1923 which is now repealed by the
provisions of the Bangladesh labor code 2006. This provisions have their
roots in the theory that a State can’t be muted spectator to the sufferings of
the working class engaged in factories of establishments who are exposed to
the varies risk to their limbs and lives. Due to technological innovations and
automation introduced in industries the working class operating these
sophisticated mechanical devices are invariably exposed to the risk of being
involved in accidents for no fault of theirs.
The Workmen’s Compensation Act, 1923 provides for payment of
compensation to workmen and their dependants in case of injury and accident
(including certain occupational disease) arising out of and in the course of
employment and resulting in disablement or death. The Act applies to railway
servants and persons employed in any such capacity as is specified in
Schedule II of the Act. The schedule II includes persons employed in factories,
mines, plantations, mechanically propelled vehicles, construction works and
certain other hazardous occupations.
The amount of compensation to be paid depends on the nature of the injury
and the average monthly wages and age of workmen. The minimum and
maximum rates of compensation payable for death (in such cases it is paid to
the dependents of workmen) and for disability have been fixed and is subject
to revision from time to time.
1.2-Obejective of study:
To determine the Workmen's Compensation Act, 1923 which aims at
providing financial protection to workmen and their dependants in
case of accidental injury by means of payment of compensation by the
To identify in case of death compensation.
To find outin case of permanenttotal disablementcompensation.
To identify in case of permanentpartialdisablement compensation.
To identify in case of permanenttemporary disablement
1.4-Limitation of Study:
Some limitations of the present study were as follows:
1. Inability of the respondents to provide information.
2. Time constraints.
3. Limitation regarding resources of information.
4. Restraint to enter some factories.
1.5-Scope of Study:
The Act extends to the whole of Bangladesh.
The Workmen's Compensation (Amendment) Act, 2000 has brought all the
workers within its sphere irrespective of their nature of employment i.e.
whether employed on casual basis or otherwise than for the purposes of the
employer's trade or business.
Establishments which are covered by the Employees State Insurance Act, are
outside the preview of this Act. The coverage of this act is also to cooks
employed in hotels and restaurants.
Every employee including those employed through a contractor and also
casual employees, who suffers an injury in any accident arising out of and in
the course of his employment, shall be entitled for compensation under the
A person employed in a factory which is yet to commence production would
not be deprived of the benefit of the provisions of the Act.
The workman employed in a premise where manufacturing process is
intended to be carried on is not necessarily required to be actually connected
with manufacturing process.
Any person engaged in such premises who is contributing for the intended
manufacturing process would be deemed to be workman for the purpose of
Government makes rules for ensuring that the provisions of the Act are
Chapter 02: Body of the Report
2.1-Reason for doing the Study:
Section 3 (1) of the Workmen Compensation Act, 1923 says that-
“If personalinjury iscaused to a workman by accident arising out of and in the
course of his employment, his employer shall be to pay compensation in
accordance with the provision of Chapter (II).”
There are three components in the definition which are – (1) personal injury
(2) accident (3) arising out of and in the course of the employment. This last
point is the key of this section. More over these two phrases has been
subjected to different kind of judicial interpretation and in varieties of cases
the court has given their opinion about the meaning of these two phrases. The
originality of these two phrases is an English Act of 1897 which was followed
in different countries legislation including India. The term “scope of
employment” was replaced by “in the course of employment” in nineteenth
century. With advancement in the field of industry workmen have become
more insecure with regard to their employment and as a result of that many
social security legislation has come up. This Act is also among them. The
judiciary has also realized this purpose of the act and interpreted the terms
widely and gave birth to doctrine of notional extension.
To determine the scope of this term and lay down the test to determine what
is “arising out of employment”. There were many attempts to construct a
meaning of this term. It has been tried to explain by nature, condition, objects
and incidents of employment.
“The words "in the course of the employment" mean "in the course of the
work which the workman is employed to do and which is incidental to it." The
words "arising out of employment" are understood to mean that during the
courseof the employment, injury hasresulted from some risk incidental to the
duties of the service, when, unless engaged in the duty owing to the master, it
is reasonable to believe the workman would not otherwise have suffered.
To identify in case of death compensation, if the worker dies from a
compensable injury, the surviving spouse and/or minor children, and lacking
such, other dependentsas defined by law, are entitled to weekly cash benefits.
The amount is equal to two-thirds of the deceased worker's average weekly
wage for the year before the accident. The weekly compensation may not
exceed the weekly maximum, despite the number of dependents.
To find out in case of permanent total disablement compensation, the
employee's wage-earning capacity is permanently and totally lost. There is no
limit on the number of weeks payable. In certain instances, an employee may
continue to engage in business or employment, if his/her wages, combined
with the weekly benefit, do not exceed the maximums set by law.
To identify in case of permanenttemporary disablementcompensation, which
are in delay status do not qualify for Workers' Compensation temporary
disability until the claim is accepted. If there is a delay in acceptance of the
claim, affected employees are encouraged to review and apply for short term
disability benefits through Staff Human Resources.
The most important feature of the chapter is that it places the entire
responsibilities for compensation on employers alone. The liability of the
employer arises only when a personal injury is caused to the worker in the
course of employment and the injury caused in the result of an accident. The
liability for payment of compensation is not dependent upon the neglect or a
wrongful act of the employer but a statutory compulsory obligation to
compensate the workman for the loss of wage earning capacity before and
after the injury is suffered by him. Therefore the act creates a new type of
liability quite distinct from the liability of the employer under the law of tort
but a liability flowing out of the relationship of master and servant. It is also
differentfrom the concept of vicariousliability based on the general principles
of law of tort or doctrine of added peril based on the principles of tortious
liability under the law of tort. The principle of added peril means that if a
workman while engaged in employer’s work, track or business engages
himself in some other work which is ordinarily he is not required to do and
such work involves extra danger, he cannot hold the master liable for the risk
arising therefrom. This is also not a contractual liability, even if there is
contract to that effect not to claim compensation from the employer for an
injury caused to workmen. An employer under the provisions of the act is
liable to compensation at the rates fixed in the chapter itself to any workman
incapacitated by an accident arising out of and in the course of his
The act provides for compulsory payment by the employer of some
compensation, calculated by reference to the wages, for death or disablement
of a worker by accident while at work independently of any negligence or
breech of duty on the part of the employer.
Here, we discuss main 5 factors of compensation act, that provides for
payment of compensation to workmen and their dependants in case of injury
and accident (including certain occupational disease) arising out of and in the
courseof employmentand resultingin disablement or death. Discuss it below:
Medical Benefits: Necessary and reasonable medical treatment,
prescriptions, and hospital services related to the work injury are paid by the
employer’s insurance carrier or directly by the employer if self-insured. The
employer and/or its insurance carrier have the right to designate medical
providers for all work-related injuries.
Temporary Total Benefits: If an injured worker is disabled for a period of
more than seven days, he or she will be eligible to receive temporary total
benefit, retroactive to the first day of lost time. The benefit will be paid at a
rate of 70% of the worker’s average weekly wage, not to exceed the statutory
maximum rate or fall below the statutory minimum rate established annually
by the Commissioner of Labor and Workforce Development. These benefits
are provided until the worker has returned to work, has reached maximum
medical improvement, or has reached the statutory 400-week maximum.
Permanent Partial Benefits: When a job-related injury or illness results in a
permanent bodily impairment, benefits are based on the individual’s
functional loss. These benefits are paid weekly and are due after the date
temporary disability ends.
Permanent Total Benefits: When a work injury or illness prevents a worker
from returning to any type of gainful employment, he or she may be entitled
to receive permanent total disability benefits. These weekly benefits are
provided initially for a period of 450 weeks. Benefits continue beyond the
initial 450 weeks provided that the injured worker is able to show that he or
she remainstotally disabled. The benefits are paid weekly and are based upon
70% of the average weekly wage, not to exceed the statutory maximum or fall
below the statutory minimum.
Death Benefits: Dependents of a worker who dies as a result of a work-
related injury or illness may be eligible to receive death benefits. The weekly
benefits are 70% of the wage of the deceased worker, not to exceed the
2.3-Scenario of the chosen company:
Sinha Fabrics Limited and Sinha Wool Wears Limited started business as a
Private Limited company in Bangladesh back in 1997, with a view to serve the
world marketas 100% export oriented readymade garments factory, that will
produce all type of garments for gents, ladies, and children of all kinds, sizes
designs made of cotton, rayon silk, jute polyester, and other fibrous products.
Since then the company has gradually developed its knowledge, skills and
abilities to perform efficient and effective production runs. The company is
being managed by the well known SINHA family members mostly, who have
well versed business knowledge from established businesses. The technical
talents and skilled labor forcehas always been the core competence of the
company. Technological advances are yet another to mention, that
facilitate error free long productions runs. So far the company has always
been successful to satisfy their commitment of Quality, Convenience and
assurance. Quality aspects are assured through specified quality control
measures at the end of each phases of production.
In this company, payment system is available for short-term disability,
sickness and accident and also payment system is available for long-term,
total permanent disability. There payment system are provided based on the
government rules under the act of workmen’s compensation. They offer
provident funds who involves more than 10 years with the company and also
offer pension plan. Company has better sick level management system and
also has proper health and safety arrangement. The wage board has followed
5% yearly increment on the basic and the workers get promotion opportunity
for their work performance.
Chapter 03: Conclusion & Recommendation
There must be a causal connection between the injury and the accident and
the work done in the course of employment;
The onus is upon the applicant to show that it was the work and the resulting
strain which contributed to or aggravated the injury; It is not necessary that
the workman must be actually working at the time of his death or that death
must occur while he was working or had just ceased to work; and Where the
evidence is balanced, if the evidence shows a greater probability which
satisfies a reasonable man that the work contributed to the causing of the
personal injury it would be enough for the workman to be entitled. But where
the accident involved a risk common to all humanity and did not involve any
peculiar or exceptional danger resulting from the nature of the employment
or where the accident was the result of an added peril to which the workman
by his own conduct exposed himself, which peril was not involved in the
normal performance of the duties of his employment, then the employer will
not be liable.
The expression in the course of his employment', connotes not only actual
work but also any other engagement natural and necessary thereto,
reasonably extended both as regards work-hours and work-place. It refers to
the time during which the employment continues. . However, this is subject to
the theory of notional extension of the employer'spremisesso as to includean
area which the workman passes and re-passes in going to and in leaving the
actual place of work. There may be some reasonable extension in both time
and place and a workman may be regarded as in the courseof his employment
even though he had not reached or had left his employer's premises. This is
also called as the Doctrine of Notional Extension. The doctrine of notional
extension could not be placed in a strait jacket; it is merely a matter of sound
Government also have some responsibility to improve the situation by
implementing - proper policy to protect the labor. Must look for ways to
improve the productivity of its labor force if it wants to compete regionally if
not globally. Because of cheap labor if our country makes the labor
productivity in the apex position, then we think the future of this sector is
Government body must ensure that the factory fully comply with the factory
act 1965 in order to construct a factory. The workers right and privileges
must also be ensured.
Company must -
following the direct payment statutes, folling the english act, provide for
the payment of the compensation by the employer to the employee.
following the actual medical expenditure incurred by him for treatment of
injuries caused during the course of employment.
enforcing the law that requires employers to secure workers’
compensation insurance coverage from commercial insurance carriers or
providing certain benefit payments to injured workers who are totally and
permanently disabled as a resultof their last work-related injury combined
with the worker’s pre-existing disabilities.
ensuring that workers receive fair and timely workers’ compensation
benefits for work-related injuries from their employers and/or insurance
Governmental agencies are required to provide workers’ compensation
benefits to their employees but are not required to purchase insurance or
receive approval as a self-insurer. They generally either 1) obtain an
insurancepolicy, 2)participate in an insurancepool, or 3) maintain a separate
appropriation for workers’ compensation.
Bangladesh Labour Code 2006 (An Interpretative & Critical Study of the
Lobour And Industrial Laws of Bangladesh) by MD. Abdul Halim.
The Bangladesh Labour Code, 2006 (With section-wise English
Translation) by MD. Abdul Halim & Masum Saifur Rahman.