Labour Laws Q/A

employee’s compensation act Principal Employer and Contractor are Jointly and Severally Liable

What will be the position with regard to payment of compensation when the victim is an employee of the contractor?

In one case, wherein the Fisheries Department of State had engaged a contractor, the contractor had employed the workman. While performing duty, the boat of the workman turned turtle in dam water and the workman drowned. His dependants filed claim which was allowed under the Act, against the State and its Contractor jointly. State filed appeal and the point involved was whether relationship of employer and employee was there between the State and the workman and whether the State is liable to pay compensation. The High Court observed that as per evidence on record, the State will come within the purview of “Principal Employer” and the contractor as “employer and agent” of the principal employer and appellant being the Principal Employer shall also be liable to pay the amount of compensation jointly and severally. Hence, appeal is dismissed.1

Contractor and principal employer both are jointly and severally liable to satisfy the claim for compensation, as raised by the defendants/claimants of the deceased workman who was engaged by the contractor for carrying out construction work of the principal employer/appellant and died due to electric short circuit.2

1. State of Madhya Pradesh v. Dharmadev Das, 2007 LLR 441 (MP HC) (DB).
2. Nitin v. Ramesh, 2015 LLR (SN) 1113 (Bom HC).

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