{"id":4769,"date":"2017-07-05T08:15:49","date_gmt":"2017-07-05T08:15:49","guid":{"rendered":"https:\/\/securenow.in\/blog\/?p=4769"},"modified":"2026-04-07T07:19:36","modified_gmt":"2026-04-07T07:19:36","slug":"workmens-compensation-need-as-an-employer","status":"publish","type":"post","link":"https:\/\/securenow.in\/insuropedia\/workmens-compensation-need-as-an-employer\/","title":{"rendered":"Workmen&#8217;s Compensation: What you need to know as an Employer"},"content":{"rendered":"<div id=\"bsf_rt_marker\"><\/div><p>Irrespective of the type or size of your business, employees or workers are the real reason for your success. Therefore, providing a safe and conducive working atmosphere to your employees is indispensable. However, one can\u2019t deny the fact that accidents or injuries can happen in a safe workplace also.<\/p>\n<p>An employer has to provide compensation and other benefits when a worker gets injured during working hours. In certain cases, the injured worker or his\/her family may also file legal claims. A workmen\u2019s compensation insurance policy protects your business from costly legal suits and hefty compensation amounts.\u00a0 Employers\u2019 liability insurance is another name for it.<\/p>\n<h2 data-path-to-node=\"5\">Key Takeaways<\/h2>\n<ul data-path-to-node=\"6\">\n<li>\n<p data-path-to-node=\"6,0,0\"><b data-path-to-node=\"6,0,0\" data-index-in-node=\"0\">The &#8220;Relevant Factor&#8221; Multiplier:<\/b> Payouts for death and total disability are not flat fees; they are calculated by multiplying a percentage of the wage by a <b data-path-to-node=\"6,0,0\" data-index-in-node=\"157\">&#8220;Relevant Factor&#8221;<\/b> from Schedule IV, which is based on the worker&#8217;s age and potential future income.<\/p>\n<\/li>\n<li>\n<p data-path-to-node=\"6,1,0\"><b data-path-to-node=\"6,1,0\" data-index-in-node=\"0\">Dual-Table Indemnity:<\/b> Employers can choose between <b data-path-to-node=\"6,1,0\" data-index-in-node=\"51\">Table A<\/b> (covering the WC Act 1923 and Fatal Accident Act 1855) or <b data-path-to-node=\"6,1,0\" data-index-in-node=\"117\">Table B<\/b> (focused on the Fatal Accident Act 1855) to align with their specific legal risk profile.<\/p>\n<\/li>\n<li>\n<p data-path-to-node=\"6,2,0\"><b data-path-to-node=\"6,2,0\" data-index-in-node=\"0\">Beyond Medical Bills:<\/b> This policy is unique because it offers <b data-path-to-node=\"6,2,0\" data-index-in-node=\"62\">Vocational Rehabilitation<\/b>, providing job training and placement assistance for workers who can no longer perform their original roles due to injury.<\/p>\n<\/li>\n<li>\n<p data-path-to-node=\"6,3,0\"><b data-path-to-node=\"6,3,0\" data-index-in-node=\"0\">Universal Industry Need:<\/b> While often associated with factories, this insurance is increasingly vital for <b data-path-to-node=\"6,3,0\" data-index-in-node=\"105\">IT and BPO sectors<\/b>, where large labor forces face different but equally valid workplace risks.<\/p>\n<\/li>\n<li>\n<p data-path-to-node=\"6,4,0\"><b data-path-to-node=\"6,4,0\" data-index-in-node=\"0\">The &#8220;On-Duty&#8221; Mandate:<\/b> Liability only triggers if the injury occurs while <b data-path-to-node=\"6,4,0\" data-index-in-node=\"74\">performing duties at work<\/b>. Injuries suffered after a shift, after termination, or during a personal fight are strictly excluded.<\/p>\n<\/li>\n<li>\n<p data-path-to-node=\"6,5,0\"><b data-path-to-node=\"6,5,0\" data-index-in-node=\"0\">Protection against &#8220;Intoxication&#8221;:<\/b> The &#8220;No-Fault&#8221; system has a hard limit\u2014if an injury is caused by the employee&#8217;s <b data-path-to-node=\"6,5,0\" data-index-in-node=\"115\">intoxication or self-inflicted harm<\/b>, the employer is not required to compensate.<\/p>\n<\/li>\n<\/ul>\n<p>Read More: <a href=\"https:\/\/securenow.in\/insuropedia\/things-small-businesses-know-workmen-compensation-insurance-policy\/\">Things Small Businesses Should Know About Workmen Compensation Insurance Policy<\/a><\/p>\n<p>This insurance policy becomes more important for companies with large labour forces or workers like business processing outsourcing, information technology, industrial units, etc. Monitored by the Ministry of Labour, the compensation amount paid to workers in India varies from one company to another.<\/p>\n<h2>When does an employer need to compensate the injured employee?<\/h2>\n<p>An employer is required to provide coverage to employees if he\/she gets injured while performing duties at work under the Workmen\u2019s Compensation Act (WCA). Along with this, the act also makes it important to pay compensation in case of disability.<\/p>\n<h3>The WC policy benefits are awarded in the following cases:<\/h3>\n<h4>1. Death<\/h4>\n<p>In the case of the death of the worker, the immediate dependent of a worker becomes entitled to get compensation. Compensation payable is 50% of monthly wages X relevant factor (age-based) as stated in Schedule IV of the Workmen Compensation Act, 1923.<\/p>\n<h4>2. Permanent Total Disability<\/h4>\n<p>If due to an on-job injury, the worker can no longer perform duties, the employer has to compensate the injured worker accordingly. Compensation payable is 60% of the monthly wage multiplied by the relevant factor based on potential income.<\/p>\n<h4>3. Permanent Partial Disability<\/h4>\n<p>When an employee has sustained an injury, which makes it difficult for him\/her to perform their role in the same capacity for the rest of their career, the employee becomes permanently partially disabled. The nature of the injury and the employee\u2019s loss of earning potential determine the compensation amount.<\/p>\n<h4>4. Temporary Disability<\/h4>\n<p>The employee also compensates employees rendered disabled for a temporary period due to workplace accident injuries.<\/p>\n<h3>Benefits offered to workers under workmen\u2019s compensation insurance policy<\/h3>\n<p>A worker\u2019s compensation system offers:<\/p>\n<ul>\n<li>Replacement income in case employees are off from work<\/li>\n<li>Payment for medical expenditures like surgeries, doctor\u2019s visits, etc.<\/li>\n<li>Vocational rehabilitation benefits like providing job placement assistance, job training, etc.<\/li>\n<\/ul>\n<h3>Exclusions under a worker\u2019s compensation cover?<\/h3>\n<p>Some of the events excluded by the Workmen Compensation Insurance Policy are as follows:<\/p>\n<ul>\n<li>Self-inflicted injuries<\/li>\n<li>Injuries caused due to intoxication<\/li>\n<li>Injury, an employee, suffers after the job<\/li>\n<li>Injuries that may happen due to a fight started by the employee<\/li>\n<li>Injuries caused after termination or layoff of the worker<\/li>\n<\/ul>\n<h2>How can an employer cover its liability under WC Act?<\/h2>\n<p>The WC Act makes it mandatory for an employer to pay compensation in case of workplace injuries. Hence, it is necessary for a company to buy a workplace insurance cover to get legal liability coverage against unforeseen events like accidents or disability.<\/p>\n<h3>A workmen&#8217;s compensation insurance policy offers the following types of coverages &#8211;<\/h3>\n<p>Table A: Indemnity against legal liability arising due to accidents of employees as per the Workmen\u2019s Compensation Act, 1923 and the Fatal Accident Act 1855.<\/p>\n<p>Table B: It covers indemnity against legal liability under the Fatal Accident Act 1855.<\/p>\n<p>The cost of workplace injury is massive, and by purchasing a workmen&#8217;s compensation insurance policy, the employer can secure itself from the hefty claim amounts. Thus, the employer can prevent legal and financial liabilities when an employee suffers injuries.<\/p>\n<p>Read More: <a href=\"https:\/\/securenow.in\/insuropedia\/myths-related-workmen-compensation-insurance-policy\/\">Myths Related to Workmen&#8217;s Compensation Insurance Policy<\/a><\/p>\n<h3>Summary Table: Tiers of Compensation &amp; Coverage<\/h3>\n<table data-path-to-node=\"3\">\n<thead>\n<tr>\n<td><strong>Disablement Category<\/strong><\/td>\n<td><strong>Payout Calculation (Age-Based)<\/strong><\/td>\n<td><strong>Strategic Benefit<\/strong><\/td>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><span data-path-to-node=\"3,1,0,0\"><b data-path-to-node=\"3,1,0,0\" data-index-in-node=\"0\">Death<\/b><\/span><\/td>\n<td><span data-path-to-node=\"3,1,1,0\">50% of Monthly Wages <span class=\"math-inline\" data-math=\"\\times\" data-index-in-node=\"21\">$\\times$<\/span> Relevant Factor.<\/span><\/td>\n<td><span data-path-to-node=\"3,1,2,0\"><b data-path-to-node=\"3,1,2,0\" data-index-in-node=\"0\">Survivor Support:<\/b> Provides for immediate dependents.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span data-path-to-node=\"3,2,0,0\"><b data-path-to-node=\"3,2,0,0\" data-index-in-node=\"0\">Permanent Total (PTD)<\/b><\/span><\/td>\n<td><span data-path-to-node=\"3,2,1,0\">60% of Monthly Wages <span class=\"math-inline\" data-math=\"\\times\" data-index-in-node=\"21\">$\\times$<\/span> Relevant Factor.<\/span><\/td>\n<td><span data-path-to-node=\"3,2,2,0\"><b data-path-to-node=\"3,2,2,0\" data-index-in-node=\"0\">Income Security:<\/b> Covers workers who can no longer work.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span data-path-to-node=\"3,3,0,0\"><b data-path-to-node=\"3,3,0,0\" data-index-in-node=\"0\">Permanent Partial<\/b><\/span><\/td>\n<td><span data-path-to-node=\"3,3,1,0\">Based on loss of earning potential.<\/span><\/td>\n<td><span data-path-to-node=\"3,3,2,0\"><b data-path-to-node=\"3,3,2,0\" data-index-in-node=\"0\">Adaptability:<\/b> Matches payout to the specific career impact.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span data-path-to-node=\"3,4,0,0\"><b data-path-to-node=\"3,4,0,0\" data-index-in-node=\"0\">Temporary Disability<\/b><\/span><\/td>\n<td><span data-path-to-node=\"3,4,1,0\">Compensation for the period off-work.<\/span><\/td>\n<td><span data-path-to-node=\"3,4,2,0\"><b data-path-to-node=\"3,4,2,0\" data-index-in-node=\"0\">Recovery:<\/b> Replaces wages until the worker returns.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span data-path-to-node=\"3,5,0,0\"><b data-path-to-node=\"3,5,0,0\" data-index-in-node=\"0\">Vocational Rehab<\/b><\/span><\/td>\n<td><span data-path-to-node=\"3,5,1,0\">Job training and placement assistance.<\/span><\/td>\n<td><span data-path-to-node=\"3,5,2,0\"><b data-path-to-node=\"3,5,2,0\" data-index-in-node=\"0\">Re-skilling:<\/b> Helps disabled workers find new roles.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span data-path-to-node=\"3,6,0,0\"><b data-path-to-node=\"3,6,0,0\" data-index-in-node=\"0\">Medical Expenses<\/b><\/span><\/td>\n<td><span data-path-to-node=\"3,6,1,0\">Coverage for surgeries and doctor visits.<\/span><\/td>\n<td><span data-path-to-node=\"3,6,2,0\"><b data-path-to-node=\"3,6,2,0\" data-index-in-node=\"0\">Restoration:<\/b> Offsets the direct cost of clinical care.<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h3>What do you need to know about Workmen&#8217;s Compensation as an Employer?<\/h3>\n<p>Buying a Workmen\u2019s Compensation Policy is beneficial for both employees and employers. Employees can get their lost wages and cover their medical bills with the help of this policy. Employers too can get legal liability coverage as they don\u2019t need to pay the compensation from their pocket at the time of the accident.<\/p>\n<p>Overall, it is a win-win situation for both the employee and employer.<\/p>\n<p>To ensure the safety and protection of each employee\/worker you should start considering purchasing a relevant protection plan according to your organisation. Securenow is a tech-focused insurance broker platform where you can <a href=\"https:\/\/securenow.in\/\">compare online insurance quotes<\/a> and make the right choice for your employees&#8217; well-being.<\/p>\n<h3 data-path-to-node=\"8\">Frequently Asked Questions (FAQs)<\/h3>\n<h4 data-path-to-node=\"9\"><b data-path-to-node=\"9\" data-index-in-node=\"0\">1. What is the difference between Table A and Table B in a WC policy?<\/b><\/h4>\n<p data-path-to-node=\"9\"><strong>A)<\/strong> Table A provides broader protection, covering your legal liabilities under the Workmen\u2019s Compensation Act, 1923, and the Fatal Accident Act, 1855. Table B is more specific, primarily offering indemnity against liabilities arising under the Fatal Accident Act, 1855. Most employers choose Table A for comprehensive statutory compliance.<\/p>\n<h4 data-path-to-node=\"10\"><b data-path-to-node=\"10\" data-index-in-node=\"0\">2. How is the &#8220;Relevant Factor&#8221; determined for a death claim?<\/b><\/h4>\n<p data-path-to-node=\"10\"><strong>A)<\/strong> The Relevant Factor is a number found in Schedule IV of the Act that corresponds to the worker&#8217;s age. A younger worker has a higher factor because they have more &#8220;potential years of income&#8221; ahead of them. This factor is multiplied by 50% of their monthly wages to reach the final compensation amount.<\/p>\n<h4 data-path-to-node=\"11\"><b data-path-to-node=\"11\" data-index-in-node=\"0\">3. Does the policy cover an employee if they are injured in a fight at the office?<\/b><\/h4>\n<p data-path-to-node=\"11\"><strong>A)<\/strong> Generally, no. Injuries resulting from a <b data-path-to-node=\"11\" data-index-in-node=\"124\">fight started by the employee<\/b> are specifically excluded. The policy is designed for &#8220;unforeseen accidents&#8221; related to work tasks, not for injuries resulting from personal misconduct or aggression.<\/p>\n<h4 data-path-to-node=\"12\"><b data-path-to-node=\"12\" data-index-in-node=\"0\">4. What are &#8220;Vocational Rehabilitation&#8221; benefits?<\/b><\/h4>\n<p data-path-to-node=\"12\"><strong>A)<\/strong> If a worker suffers a permanent injury that prevents them from doing their old job (like a driver losing their eyesight), the policy can provide <b data-path-to-node=\"12\" data-index-in-node=\"195\">Vocational Rehabilitation<\/b>. This includes paying for new job training or placement assistance to help the worker find a different way to earn a living.<\/p>\n<h4 data-path-to-node=\"13\"><b data-path-to-node=\"13\" data-index-in-node=\"0\">5. Am I liable for an injury that happens 10 minutes after a worker clocks out?<\/b><\/h4>\n<p data-path-to-node=\"13\"><strong>A)<\/strong> The Act generally covers injuries that happen <b data-path-to-node=\"13\" data-index-in-node=\"126\">&#8220;in the course of employment.&#8221;<\/b> If the worker has finished their duties and left the work premises, the employer is typically no longer liable. Injuries suffered &#8220;after the job&#8221; are a standard exclusion in most WC policies.<\/p>\n<p><script type=\"application\/ld+json\">\n{\n  \"@context\": \"https:\/\/schema.org\",\n  \"@type\": \"FAQPage\",\n  \"mainEntity\": [\n    {\n      \"@type\": \"Question\",\n      \"name\": \"What is the difference between Table A and Table B in a WC policy?\",\n      \"acceptedAnswer\": {\n        \"@type\": \"Answer\",\n        \"text\": \"A) Table A provides broader protection, covering your legal liabilities under the Workmen\u2019s Compensation Act, 1923, and the Fatal Accident Act, 1855. Table B is more specific, primarily offering indemnity against liabilities arising under the Fatal Accident Act, 1855. 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The policy is designed for \\\"unforeseen accidents\\\" related to work tasks, not for injuries resulting from personal misconduct or aggression.\"\n      }\n    },\n    {\n      \"@type\": \"Question\",\n      \"name\": \"What are \\\"Vocational Rehabilitation\\\" benefits?\",\n      \"acceptedAnswer\": {\n        \"@type\": \"Answer\",\n        \"text\": \"A) If a worker suffers a permanent injury that prevents them from doing their old job (like a driver losing their eyesight), the policy can provide Vocational Rehabilitation. This includes paying for new job training or placement assistance to help the worker find a different way to earn a living.\"\n      }\n    },\n    {\n      \"@type\": \"Question\",\n      \"name\": \"Am I liable for an injury that happens 10 minutes after a worker clocks out?\",\n      \"acceptedAnswer\": {\n        \"@type\": \"Answer\",\n        \"text\": \"A) The Act generally covers injuries that happen \\\"in the course of employment.\\\" If the worker has finished their duties and left the work premises, the employer is typically no longer liable. Injuries suffered \\\"after the job\\\" are a standard exclusion in most WC policies.\"\n      }\n    }\n  ]\n}\n<\/script><\/p>\n<h4><b>About The Author<\/b><\/h4>\n<p><strong>Rahul Kumar\u00a0<\/strong><\/p>\n<p><span style=\"font-weight: 400;\">MBA Finance<\/span><\/p>\n<p><span style=\"font-weight: 400;\">With a wealth of experience in the insurance industry, Rahul is a seasoned writer specializing in articles related to workmen compensation policies (WC policies) for SecureNow. With 12 years of experience in the field, he has acquired in-depth knowledge and expertise in workmen compensation insurance, understanding its complexities and nuances. Their insightful articles provide valuable insights into the importance of WC policies for businesses and employees alike, offering practical advice and guidance on navigating the intricacies of insurance coverage. Trust him to deliver informative and engaging content, backed by years of experience and a passion for educating readers about insurance-related topics.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Irrespective of the type or size of your business, employees or workers are the real reason for your success. Therefore, providing a safe and conducive working atmosphere to your employees is indispensable. However, one can\u2019t deny the fact that accidents or injuries can happen in a safe workplace also. An employer has to provide compensation [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":4770,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"_lmt_disableupdate":"no","_lmt_disable":"no","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[296,295],"tags":[60],"class_list":["post-4769","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-importance-workmen-compensation","category-workmen-compensation","tag-workmen-compensation-insurance-policy"],"acf":[],"modified_by":"SecureNow","_links":{"self":[{"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/wp\/v2\/posts\/4769","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/wp\/v2\/comments?post=4769"}],"version-history":[{"count":19,"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/wp\/v2\/posts\/4769\/revisions"}],"predecessor-version":[{"id":36145,"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/wp\/v2\/posts\/4769\/revisions\/36145"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/wp\/v2\/media?parent=4769"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/wp\/v2\/categories?post=4769"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/securenow.in\/insuropedia\/wp-json\/wp\/v2\/tags?post=4769"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}