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Section 73: Employer's liability for employee's compensation

The Code on Social Security, 2020 (Act No. 36 of 2020) • Official Statutory Text & Plain English Practice Guide

Statutory Mandate
Chapter VII: Employee's Compensation
Competent Labour Forum
Act No. 36 of 2020
Section 72 All 163 Sections of Code on Social Security, 2020 Section 74

Legal Commentary & Landmark Judgments: Section 73

Section 73 of the Code on Social Security codifies the strict statutory liability of employers to pay compensation to employees or their dependents for personal injury or death caused by accidents arising out of and in the course of employment.

  • Core Legal Standard: Section 73 establishes the employer's strict liability for workplace accidents and occupational diseases.
  • Sub-Section (1): Chapter: Under sub-section (1), if personal injury is caused to an employee by accident arising out of and in the course of his employment, his employer shall be liable to pay compensation in accordance with the provisions of Chapter VII.
  • Operational Mechanism: Limited statutory exceptions exist where the injury does not result in total or partial disablement exceeding three days, or where the employee was under the influence of drugs/alcohol or willfully disobeyed explicit safety rules (not applicable in cases of death or permanent total disablement).

Sub-section (2) provides that contracting an occupational disease listed in the Third Schedule is deemed an injury by accident arising out of employment.

Key Landmark Precedents:
  • Mackinnon Mackenzie & Co. Ltd. v. Ibrahim Mahmmod Issak (1969) 2 SCC 607: The Supreme Court formulated the classic test for 'arising out of and in the course of employment': there must be a causal relationship between the employment and the accident, and the accident must occur while the employee is reasonably discharging duties incidental to employment.
  • General Manager, B.E.S.T. Undertaking v. Agnes (Mrs) (1964) 3 SCR 930: The Supreme Court established the doctrine of 'notional extension of employment', holding that an accident occurring while an employee travels to or from work using transportation provided or reasonably necessitated by employment falls within statutory compensation.
Legal Commentary:

Section 73 operates on a no-fault strict liability principle: the employee or their dependents do not have to prove negligence on the part of the employer. Compensation for death or permanent total disablement is calculated based on monthly wages and actuarial age factors, paid directly through the Employee's Compensation Commissioner.

Section 72 All 163 Sections of Code on Social Security, 2020 Section 74