Labour ministry notifies draft rules for compensation under Code on Social Security

The Minister of State for Labour and Employment (Independent Charge), Santosh Kumar Gangwar (Image Source: PIB)

The Ministry of Labour & Employment on June 3 notified the draft rules relating to Employee’s Compensation under the Code on Social Security, 2020.

The draft rules relating to compensation are aimed at ensuring that payments are made within 30 days to the workers or to their families in case of disability or death.

"The draft Employee’s Compensation rules notified by the central government provide for the provisions relating to manner of application for claim or settlement, rate of interest for delayed payment of compensation, venue of proceedings and transfer of matters, notice and manner of transmitting money from one competent authority to another and arrangements with other countries for the transfer of money paid as compensation," the ministry said in a statement on June 15.

The ministry has sought comments from the stakeholders on the proposed draft Rules within 45 days from the date of the notification, following which it will be notified and become effective.

As per the draft rules, in case the payment of compensation amount is delayed, the employer will be liable to pay interest at the rate of 12 percent per annum from the due date till the date the compensation is made.

"If the amount of compensation payable under sub-section (3) of section 77 is not paid by the employer within the period of thirty days, the employer shall pay, from the date on which the compensation become payable to the date on which it is paid, simple interest at the rate of twelve per cent. per annum or any other rate notified by the Central Government from time to time," the draft notification said.

The ministry has also notified rules to give effect to arrangements with other countries for the transfer of money paid as compensation under section 159 of the Code.

"When any sum is transmitted by any authority in India to any other authority in accordance with these rules, the costs of such transmission may be deducted from the sum so transmitted," the draft rules stated.

The proposed draft Rules will supersede the Employee’s Compensation Rules, 1924, Employee’s Compensation (Transfer of Money) Rules, 1935 and Employee’s Compensation (Venue of Proceedings) Rules, 1996, the draft notification said.

The draft rules under the Code on Social Security, 2020 which relate to Employees’ Provident Fund, Employees’ State Insurance Corporation, Gratuity, Maternity Benefit, Social Security and Cess in respect of Building and Other Constructions Workers, Social Security for Unorganised Workers, Gig Workers and Platform Workers and Employment Information were notified by the Labour Ministry on November 13, 2020.