EMPLOYER NOT LIABLE TO PAY COMPENSATION

Section 3 (Exceptions)

According to the Section 3(1) of The Employees’ Compensation Act, 1923, the employer is
NOT liable to pay compensation to an employee under following circumstances:

i. The injury (total or partial disablement) sustained by the employee does not
exceed the period of 3 days;
ii. Any injury that doesn’t result in death or permanent total disablement,
and is attributed to the following circumstances (the employer can plead ‘not
liable’):
(a) The employee was under the influence of drugs/medication or alcohol;
(b) ‘Wilful Disobedience’ by employee of an express order or express rule (in
place for the employees’ safety)1; and
(c) Wilful disregard or elimination of certain safety-guards or devices
provided for the safety of the employee.

In the case of Arya Muni v. Union of India 2, an employee met with an accident while working
on June, 1954, and lost his right eye due to an injury thus sustained. There was a notice in
English advising the usage of goggles while working to the employees and he knew and
understood the content of the notice. It was later observed by the court that the supervisor had
just put up the notice and had not properly promoted the safety measures. He did not make
the employees aware of their rights and the safety measures in place for them as ardently as
possible. The court held the employee not wilfully disobedient.

The clause (c) is similar to the concept of Doctrine of Added Peril (established in the case of
Lancashire and Yorkshire Railway Co. v. Highley). The doctrine of added peril disentitles an
injured employee from compensation on the bottom that he had taken a larger threat than he
had been required by his employer to imagine. Due to this fact, the place the harm will not be
prompted to workman by an accident arising out of employment, he/she will not be entitled to
get any profit or compensation.

1
Chaitram v. Steel Authority of India Ltd. Bihar, (1991) II LLJ 144 (MP) – Where the death of an employee was
caused due to an accident arising out of and in the course of employment, wilful disobedience cannot be used as
a defence by the employer. It is a plea only accepted in cases of injury not resulting in death.
2
(1965) I LLJ 24.