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SCHOOL: LOVELY INSTITUTE OF MANAGEMENT

TOPIC: 1. TO SOLVE THE QUESTIONS RELATED TO


FACTORY ACT 1948 & WORKMAN
COMPENSATION ACT.
DOA: 18.01.2011
DOS: 25.01.2011

SUBMITTED TO: SUBMITTED BY:


MISS JATINDER KAUR NAME: SHASHI SHEKHAR
SECTION : T1007
ROLL NO. : B47
REG. NO. : 11004658
CLASS : B.B.A(LIM)
ACKNOWLEDGEMENT

I have been fortunate enough to have a lot of people who helped me in


this assignment so I wish to acknowledge them all.

Firstly, really thankful to my parents who have encouraged me in


almost every aspects and supported me throughout this venture. I really want to
thanks my teachers and especially Miss Jatinder Kaur who helped me in this
assignment. She teaches with so much energy that it has created thirst in me for
the subject. I am also very thankful to my friends whose motivation was like a
blessing during this endeavour.

Last but not the least; I am also very thankful to all my faculty
members of LIM as there support was the source of motivation for me
throughout.

Thanking you

Shashi Shekhar
INTRODUCTION

In this assignment we gave light on the 1948 Factories Act and


1923 Workmen’s Compensation Act.
The first Factories act in India was passed in 1881. It was designed
primarily to protect children & to provide for some health, welfare & safety
measures. It was followed by new Acts in 1891, 1911, 1922 & 1934. The act of
1934 was passed to implement the recommendations of the Royal Commission
on labour in India & the conventions of the International Labour Organisation
the experience of the working of this act revealed a number of defects &
weakness which hampered effective administration of the act. Further, the
provisions of this Act regarding safety, health & welfare. The Factories Act,
1948 came into force on the 1st day of April, 1949.Its object is to regulate the
conditions of work in manufacturing establishments which come within the
definition of the term ‘factory’ as used in the act. The Act was substantially
amended in 1987. some provisions of the Amending Act came into force with
effect 1st December, 1987 & others from 1st June, 1988.
The passing of workmen’s Compensation Act in 1923 was the first
step towards social security of workmen. The main object of the act is to
provide for the payment of compensation by certain classes of employees to
their workmen for injury by accident. The theory of workmen’s compensation is
that “the cost of product should bear the blood of the workmen”. The Act came
into force on the day of July, 1924[sec.1 (3)]. It extends to the whole of India
[sec.1 (2)]. The latest amendment to the Act was made in 1995.
Now we have to discuss on some cases of law related to factories
and its workers.
CASES AND SOLUTIONS
PART-A
1. Ram, Shyam and Manohar are working in factory ABC Ltd. Their
names were not entered in register; however they are getting all the wages
and allowance from the factory. One day ram met with accident. Can the
factory owner claim for the damages under group insurance.

Ans. No, the factory cannot claim for the damages under group insurance
because according the Factory Act 1948, the name, group and nature of the
work of the employee should be mentioned in the register of the factory. If this
condition fulfils in a factory then only the employee would be liable for the
damages.

2. Rajan met with an accident while working on machine in steel factory.


The nature of job was risky. Will the owner is guilty of offence.

Ans. Yes, the owner is guilty of offence because if the job of a worker in a
factory is risky then the owner should provide every kind of protection
equipments that are mentioned in the Factory Act. By which the employee
would be able to protect himself from any kind of accidents.

3. XYZ ltd. took a group insurance scheme for 100 workers with the
detailed list and with the hazardous processes. Now accident happens with
another cause which was not mentioned while taking insurance policy. Now
who is liable to pay insurance company or the factory owner.

Ans. The factory owner is liable because the accident happened with another
cause was not mentioned by the factory owner while taking insurance policy.
That’s why the factory owner is liable.

4. Kalpana was working in a factory for 60 hours on a weekly basis. She is


getting Rs. 20 per hour extra for the overtime. What is the status in the
eyes of law about the situation?

Ans. According to the Factory Act 1948 Sec 51 no adult is allowed to work
more than 48 hours in a week and 9 hrs. in a day, so Kalpana is not allowed to
work in a factory more than 48 hrs regularly.
5. Rajni was working in a factory from 10 am to 8 pm and she is getting Rs.
100 per day as wages and on time with the extra meal. Discuss is there any
violation under factories act, 1948.

Ans. Yes, there is a violation under the Factory Act 1948, because in this case
Rajni was working for 10 hrs. which is not allowed by the law to work more
than 9 hrs. in a day for a woman.

PART-B
6. Rajbir was a wage earner in XYZ ltd and left the job on 25 October
2009. On 29 October 2009 he came in factory to clear all his dues, at that
time he met with accident with machine and lost his one leg. Does the
factory owner is liable to compensate.

Ans. No, the factory owner is not liable to compensate. Because according to
the Factory Act 1948 an employer is only liable to compensate for their
employer not for common person. Here in this case when Rajbir came on 29
October 2009 to clear all his dues he was no more employee in that factory as
he had left the job on 25 October 2009.

7. Mohan was a wage earner in ABC ltd. His timings were 8am to 6 pm. He
met with accident at 8 pm and lost his hand. Does the factory owner is
liable to compensate.

Ans. Yes, the factory owner is liable to compensate. According to The


Workman Compensation Act 1923 Sec 3(1) if personal injury caused to any
employee by accident arising out of or during the course of employment then
the employer would be liable.

8. Murari was working with cotton factory from last ten years. Because of
this type of working he lost his eyes. Is the employer is liable to pay any
gratuity and compensation.

Ans. Yes, the employer is liable to pay any gratuity and compensation because
according to the workman compensation 1923 sec3(2) if any employee
contracts any of the disease during the occupation then the employee should be
compensate.
9. In the above question Murari is claiming further the monthly regular
pay for next 5 years from his factory owner. What is the legal status?

Ans. No, this is not a legal status. As according to the Workman Compensation
Act 1923, sec4(1)(b) in a permanent disablement of any employee, he will get-
60% of monthly wages x relevant wages
100

10. Sohan was working in a power plant. One day he came drunk at plant
and died because of electric shock at plant. Is the factory owner liable to
pay compensation?

Ans. No, the factory owner is not liable to pay compensation because according
to the Workman Compensation Act 1923, intoxication by drink is prohibited
during the course of employment. It is Sohan’s mistake for which factory owner
is not liable to pay any type of compensation.
REFRENCES

1. Kapoor, N.D, Elements of Mercantile Law, Sultan Chand and Sons,, New
Delhi, 30th Edition,2009
2. Individual subject teacher i.e. MISS JATINDER KAUR.
3. Friends & Class-mates