Indemnifies the employer against his legal liability for injuries to his employees resulting from accidents occurring in the course of their employment.
The Workmen's Compensation Act 1987 makes it compulsory for any Employers of labour to set aside funds to compensate any worker who may sustain injury at the work place whether or not the Employer is to blame.
The 1987 Act was an improvement on the earlier Acts in many ways e.g.
- The minimum number of 5 days to qualify for accidental injury benefit was quashed.
- The maximum working limit of compensation under the old Law has been increased to ¢560,000.00 for death and ¢896,000.00 for total permanent incapacity respectively.
- The definition of a worker has been expanded to include any person who receives salary or wages except an outworker, a tributary, and a family member of the employer living with the latter or where the Law prohibits as a worker
Besides, compensation for bodily injury there is provision for payment of Medical Expenses as a result of the injury.
An employer may choose to insure his liability under the Act and in addition can extend his liability to cover claims under Common Law.