📘 Employees’ Compensation Act, 1923 – 50 MCQs with

Explanations

General & Historical Background

1. The Employees’ Compensation Act was enacted in:

A. 1920
B. 1923
C. 1935
D. 1947
Answer: B
➡️The law was passed in 1923 to provide compensation for
industrial accidents.

2. The Act came into force on:

A. 1 January 1923
B. 5 March 1923
C. 1 July 1924
D. 26 January 1950
Answer: C
➡️Though enacted in 1923, it became effective from 1 July 1924.

3. The original name of the Act was:

A. Labour Compensation Act
B. Workmen’s Compensation Act
C. Employee Safety Act
D. Accident Relief Act
Answer: B
➡️It was called the Workmen’s Compensation Act, 1923 until
2009.

4. The word “Workman” was replaced by “Employee” by:

A. Amendment Act, 2005
B. Amendment Act, 2009
C. Amendment Act, 2017
D. Amendment Act, 2020
Answer: B
➡️The 2009 Amendment changed the terminology to “employee.”
 5. The Amendment Act, 2009 came into force on:
A. 18 January 2010
B. 1 April 2010
C. 15 August 2009
D. 1 July 2009
Answer: A
➡️The amendment was enforced from 18 January 2010.

Definitions & Coverage

6. The term “minor” under the Act means a person below:

A. 14 years
B. 15 years
C. 16 years
D. 18 years
Answer: D
➡️A “minor” means a person below 18 years.

7. Which of the following is NOT included in wages?

A. Privileges capable of being estimated in money
B. Special allowance due to employment nature
C. Employer’s contribution to PF
D. Bonus forming part of contract of employment
Answer: C
➡️PF contribution by employer is excluded from “wages.”

8. Members of which force are excluded from the definition of

“employee”?
A. Home Guards
B. Armed Forces of the Union
C. Railway Employees
D. Seamen
Answer: B
➡️Armed Forces are governed by separate service laws.

9. Dependants include:
A. Widowed mother
B. Married daughter above 18 years
C. Major son (healthy)
D. Brother above 25 years
 Answer: A
➡️“Widowed mother” is specifically included under dependants.

10. Dependants also include:

A. Widowed daughter-in-law
B. Minor child of pre-deceased son
C. Paternal grandparent if no parent alive
D. All of the above
Answer: D
➡️All these categories are expressly listed as dependants.

Employer’s Liability (Sec. 3)

11. Employer is liable to pay compensation if injury:

A. Arises out of and in course of employment
B. Is minor injury less than 3 days
C. Is due to employee’s drunkenness
D. Is self-inflicted
Answer: A
➡️Liability arises only when injury is employment-related.

12. Compensation is NOT payable if disablement lasts less than:

A. 2 days
B. 3 days
C. 5 days
D. 7 days
Answer: B
➡️Compensation is not payable if disablement is under 3 days.

13. Compensation is NOT payable if injury results from:

A. Natural causes at workplace
B. Wilful disobedience of safety rules
C. Accident during course of duty
D. Occupational disease
Answer: B
➡️Employer is not liable if injury is due to wilful disobedience.

14. Occupational diseases are listed in:

A. Schedule I
 B. Schedule II
C. Schedule III
D. Schedule IV
Answer: C
➡️Schedule III contains occupational diseases (e.g., silicosis).

15. Contracting out of the Act is:

A. Valid if signed by both parties
B. Valid with government approval
C. Void
D. Allowed for temporary workers only
Answer: C
➡️Sec. 17 makes such contracts void.

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📘 Employees’ Compensation Act, 1923 – MCQs with Explanations

(Part 2)

Compensation (Sec. 4 & 4A)

16. Minimum monthly wage for compensation calculation (2020

notification):
A. ₹4,000
B. ₹6,000
C. ₹8,000
D. ₹15,000
Answer: D
➡️Government revised the wage ceiling in 2020 → ₹15,000/month.
 17. In case of death, compensation is:
A. 50% of wages × Factor or ₹1,20,000 (whichever higher)
B. 60% of wages × Factor or ₹1,20,000 (whichever higher)
C. 50% of wages × Factor or ₹1,40,000 (whichever higher)
D. Fixed ₹1,50,000 only
Answer: A
➡️Sec. 4(1)(a): Death = 50% of monthly wages × factor OR
₹1,20,000, whichever is higher.

18. In case of permanent total disablement, compensation is:

A. 50% of wages × Factor or ₹1,20,000
B. 60% of wages × Factor or ₹1,40,000
C. 70% of wages × Factor or ₹1,60,000
D. Fixed ₹1,80,000 only
Answer: B
➡️Sec. 4(1)(b): PTD = 60% wages × factor OR ₹1,40,000,
whichever is higher.

19. Temporary disablement → half-monthly payment @:

A. 20% of wages
B. 25% of wages
C. 30% of wages
D. 50% of wages
Answer: B
➡️Sec. 4(2): Temporary disablement = 25% of wages every half-
month.

20. Delay in payment of compensation → Interest + Penalty:

A. Interest @ 6% + penalty 20%
B. Interest @ 9% + penalty 25%
C. Interest @ 12% + penalty 50%
D. Only interest, no penalty
Answer: C
➡️Sec. 4A: Employer must pay when due → otherwise 12% interest
+ penalty up to 50%.

Procedure

21. Notice of accident must be given:

A. Immediately
 B. Within 7 days
C. Within 1 month
D. Within 2 years
Answer: A
➡️Sec. 10: Accident notice should be immediate (but claim may be
within 2 years).

22. Maximum period for filing claim:

A. 6 months
B. 1 year
C. 2 years
D. 3 years
Answer: C
➡️Sec. 10: Claim must be filed within 2 years from accident or
death.

23. Appeals lie to:

A. Labour Court
B. District Court
C. High Court
D. Supreme Court
Answer: C
➡️Sec. 30: Appeals from Commissioner go directly to High Court.

24. Appeal period is:

A. 30 days
B. 45 days
C. 60 days
D. 90 days
Answer: C
➡️Appeals must be filed within 60 days.

25. Registration of compensation agreements is under:

A. Sec. 28
B. Sec. 29
C. Sec. 30
D. Sec. 31
Answer: A
 ➡️Sec. 28: Compensation agreements must be registered with
Commissioner.

Commissioners (Chapter III)

26. Commissioners are appointed under:

A. Sec. 18
B. Sec. 19
C. Sec. 20
D. Sec. 21
Answer: C
➡️Sec. 20: Government appoints Commissioners for Employees’
Compensation.

27. Venue of proceedings is covered under:

A. Sec. 19
B. Sec. 20
C. Sec. 21
D. Sec. 22
Answer: C
➡️Sec. 21: Proceedings may be taken where accident occurred,
employee resides, or employer has office.

28. Commissioner must dispose compensation cases within:

A. 3 months
B. 6 months
C. 9 months
D. 12 months
Answer: B
➡️Sec. 25A: Commissioner should decide cases within 6 months.

29. Powers of Commissioner are similar to:

A. District Collector
B. Civil Court
C. Magistrate
D. Labour Inspector
Answer: B
➡️Commissioner has powers of a Civil Court in recording evidence,
enforcing attendance, etc.
 30. Appeal to High Court lies only when:
A. Substantial question of law involved
B. Commissioner made arithmetic error
C. Employee not satisfied with compensation
D. Employer requests review
Answer: A
➡️Appeal allowed only when there is a substantial question of
law.

Special Provisions

31. Sec. 15 deals with:

A. Employees abroad
B. Masters and Seamen
C. Aircraft Crew
D. Motor Vehicle Employees
Answer: B
➡️Special provisions apply to seamen and ship employees.

32. Sec. 15A deals with:

A. Seamen
B. Aircraft crew
C. Railway workers
D. Migrant workers
Answer: B
➡️Special provisions for aircraft crew.

33. Sec. 15B deals with:

A. Employees abroad of companies/motor vehicles
B. Apprentices
C. Teachers
D. Government servants
Answer: A
➡️Special provisions for employees working abroad.

34. Compensation cannot be assigned/attached under:

A. Sec. 6
B. Sec. 9
 C. Sec. 14
D. Sec. 17
Answer: B
➡️Sec. 9: Compensation is not attachable/transferable by
creditors.

35. Compensation is first charge on employer’s assets transferred

under:
A. Sec. 13
B. Sec. 14
C. Sec. 14A
D. Sec. 16
Answer: C
➡️Sec. 14A: Compensation has first charge on transferred
assets.

Penalties & Amendments

36. Employer’s duty to inform employees of their rights

introduced by:
A. 2005 Amendment
B. 2009 Amendment
C. 2017 Amendment
D. 2020 Amendment
Answer: C
➡️2017 Amendment added Sec. 17A.

37. Section 17A requires employer to inform rights in:

A. English only
B. Hindi only
C. English/Hindi/local language
D. Any foreign language
Answer: C
➡️Employer must inform in English, Hindi, or local language
understood by employee.

38. Failure to inform rights attracts fine:

A. ₹1,000 – ₹5,000
B. ₹10,000 – ₹25,000
C. ₹50,000 – ₹1,00,000
 D. ₹1,00,000 – ₹2,00,000
Answer: C
➡️Fine prescribed = ₹50,000–₹1,00,000.

39. General penalties under Sec. 18A (old):

A. Fine up to ₹500
B. Fine up to ₹1,000
C. Fine up to ₹5,000
D. Imprisonment 1 year
Answer: C
➡️General penalty = fine up to ₹5,000.

40. Transfer of Money Rules framed under:

A. Sec. 30
B. Sec. 32
C. Sec. 35
D. Sec. 36
Answer: C
➡️Rule-making power under Sec. 35 includes transfer of money.

Schedules

41. Schedule I deals with:

A. Injuries causing disablement & % loss
B. Classes of employees
C. Occupational diseases
D. Factors for lump sum
Answer: A
➡️Schedule I = list of injuries with % loss of earning capacity.

42. Schedule II deals with:

A. List of employees covered
B. Factors for calculation
C. Disablement injuries
D. Compensation rules abroad
Answer: A
➡️Schedule II lists categories of employees covered.
43. Schedule III deals with:
A. Disablement injuries
B. Occupational diseases
C. Classes of employees
D. Lump sum calculation
Answer: B
➡️Schedule III lists occupational diseases.

44. Schedule IV deals with:

A. List of employees
B. Occupational diseases
C. Factors for lump sum equivalent
D. Classes of accidents
Answer: C
➡️Schedule IV = factors for calculating lump sum compensation.

45. Loss of both hands → % of loss of earning capacity:

A. 50%
B. 75%
C. 90%
D. 100%
Answer: D
➡️Loss of both hands = 100% loss of earning capacity.

46. Loss of thumb only (Schedule I):

A. 20%
B. 25%
C. 30%
D. 40%
Answer: C
➡️Thumb loss = 30% earning capacity loss.

47. Loss of one eye (other normal):

A. 20%
B. 30%
C. 40%
D. 50%
Answer: C
➡️One eye lost = 40% loss.
48. Amputation at hip → loss of earning capacity:
A. 70%
B. 80%
C. 90%
D. 100%
Answer: C
➡️Hip amputation = 90% loss.

49. Guillotine amputation of tip of thumb without bone loss → %:

A. 5%
B. 10%
C. 15%
D. 20%
Answer: B
➡️Minor thumb injury without bone loss = 10% loss.

50. Absolute deafness → % loss of earning capacity:

A. 50%
B. 75%
C. 90%
D. 100%
Answer: D
➡️Absolute deafness = 100% loss of earning capacity.