Employee Having National Trade Certificate & Prior Experience To Be Treated As 'Highly Skilled' For Compensation: Orissa High Court

"Irrespective of his period of working under the Appellant, his previous experience in the same line of work in other industries cannot be overlooked. In view of his qualification and previous experience, the deceased cannot be treated any less than a high-skilled labourer," Orissa High Court, in a significant judgment, held that an employee possessing technical qualifications like a National Trade Certificate and prior industry experience must be categorized as a "highly skilled" laborer for the purpose of calculating compensation under the Employees’ Compensation Act, 1923.

A single-judge bench of Justice B.P. Routray observed that such qualifications and experience justify the adoption of a higher wage bracket, even if the current employer categorized the worker differently.

The appeal was filed by the Managing Director of Kalinga Jute Products Pvt. Ltd. challenging an award of Rs. 11,48,175/- passed by the Commissioner for Employee’s Compensation. The deceased, Prasanta Kumar Rout, a Machine Operator-cum-Mechanic, died on January 24, 2021, due to severe neck injuries sustained at the workplace. While the employer contended the deceased was an "Apprentice" earning semi-skilled wages, the family claimed he was a highly skilled worker entitled to higher compensation.

The primary question before the court was whether the deceased employee should be categorized as a semi-skilled or highly skilled laborer for the determination of monthly wages under the EC Act. The court also examined the impact of the 2010 amendment to Section 4 of the Act regarding the "deeming cap" on monthly income.

EC Act A Socio-Beneficial Legislation

The Court emphasized that the Employees’ Compensation Act, 1923, is a socio-beneficial legislation designed to protect workers and their families. It noted that the provisions of the Act must be interpreted liberally to ensure that compensation is "just" and not inadequate or unjust.

The bench observed that while determining compensation, the socio-economic conditions and the cost factor at the relevant period must be considered. Taking a pragmatic approach is essential to fulfill the legislative intent of providing relief for accidents arising out of and in the course of employment.

"The interpretation must be on the principles of just compensation... the compensation to be computed cannot be inadequate or unjust."

Deletion Of Wage Cap Under Section 4

The Court referred to the landmark Supreme Court decision in K. Sivaraman and Others v. P. Sathishkumar and Another (2020) to explain the shift in the law. Prior to the 2009 amendment, the monthly wages of an employee were capped at Rs. 4,000 for compensation calculations, even if the actual wage was higher.

However, the legislature subsequently deleted this deeming cap to extend compensation based on the actual monthly wages drawn by the employee. The Court noted that under Section 4(1-B), the Central Government now notifies a monthly wage limit (currently Rs. 15,000) for the purpose of calculation, but this does not prevent the consideration of actual wages.

"The objective of the amendment is to remove a deeming cap on the monthly income of an employee and extend to them compensation on the basis of the actual monthly wages drawn by them."

Determination Of Wages In Absence Of Clear Evidence

The bench addressed the scenario where clear material or acceptable evidence regarding actual wages is missing. In such circumstances, the court held that the rates prescribed by the Government as minimum wages for unskilled, skilled, semi-skilled, and highly skilled laborers would govern the field.

The Court pointed out that in the present case, the employer failed to produce the relevant wage register or payment register to fortify their claim that the deceased was only receiving semi-skilled wages. This lack of documentary evidence from the employer's side allowed the court to look into ancillary materials and claimant testimonies.

"Where there is no clear material... then the rates prescribed by the Government as minimum wages... read with the wages prescribed under section 4(1-B) of the E.C. Act, would govern the field."

Qualification And Experience Determine Skill Category

The Court highlighted that the deceased was an experienced worker who had previously worked in other industries and possessed a National Trade Certificate. The bench rejected the employer's attempt to treat a person with industrial training and technical certification as a mere semi-skilled laborer.

Given that the minimum wage for a highly skilled laborer at the time was nearly equivalent to the claimed amount, the Court found the claimants' assertion of Rs. 500 per day (Rs. 15,000 per month) to be justified. It held that technical qualifications and previous experience are decisive factors in determining the skill category for compensation.

"A person having qualification of industrial training and having National Trade Certificate in his favour... cannot of course be treated as a semi-skilled labourer for the purpose of computation of compensation."

The High Court dismissed the employer's appeal and confirmed the award of Rs. 11,48,175/-. It directed the employer to pay the balance amount to the respondents within a period of two months, after adjusting the amount already deposited. The ruling reinforces that the professional standing and certification of a workman must be respected when quantifying death benefits under welfare statutes.

Date of Decision: 22 June 2026