We keep facing the questions of what is the liability of employer in case of damages or accidents happened with employees.

Employers Liabilities act, 1938 gives the answers to all such questions.

Here is a quick summary of the act. The act is very less discussed and employees are not aware of the act. Refer the act for more details, here is a little explanation on the liabilities that employer have if employees have any accidents while on work place.

Definition of Employer as per Employers' Liability Act, 1938

Employer includes any body of persons whether incorporated or not, any managing agent of an employer, and the legal representative of a deceased employer, and, where the services of a workman are temporarily lent or let on hire to another person by the person with whom the workman has entered into a contract of service or apprenticeship means such other person while the workman is working for him.

Explanation: The employer does not include only the direct employer but also the person who is receiving the service of employee from employer. For example, temporarly placed labours on builders site by HR agencies. In this case builder is the employer for labours. Clerks working at client place on assignment are the employee of the client. Even the person doing internship is employee for the purpose of this act.

Definition of Employee as per Employers Liabilities Act, 1938

Workman means any person who has entered into, or works under a contract or, service or appranticeship with the an employer whether by way of manual labour, clerical work or otherwise, and whether the contract is expressed or implied, oral or in writing.

Explanation: Workman includes every employee of the organisation whether doing labout jobs or clerical work. Even the one doing internship is included under this act. A written contract is not necessary, oral or implied contract will be sufficient to constitute workman of the employer.

Damages can be claimed by Workman

Any personal injury caused to workman by the reason of:

  1. Negligence of the employer in maintainance of machinary or work place (directly or indirectly)
  2. Negligence of any person authorised by employer
  3. By the negligence of the any person who was authorised by the employer and was responsible for safety of workman
  4. By the reason of the act or omission of any person in the service of the employer done of made-
    (i) In the normal performance of the duties of that person; or

    (ii) In obedience to any rule or bye-law of the employer

    (iii) In obedience to particular instructions given by any other person to whom the employer has delegated authority in that behalf.

A suit claiming damage should not be voided on the condition that injury happened to workman was part of the normal duty involved in execution of work of employer.

Any clause in the employement agreement will be void which limits the liabilities of employer in case of any injury or damage to workman.

When a suit is filed for damage, it should not be considered that workman was aware of the risk associated with job unless employer proves that risk was fully explained to and was understood by the workman and that the workman voluntarily undertook the same.

Posted 6 years ago by CA Pulkit Sharma

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