Strengthening workers’ compensation governance and financing through establishment of a Workers’ Compensation Fund

The establishment of the Workers’ Compensation Fund is aligned with the recommendations of the International Labour Organization under Convention No. 102 of 1952, which recognizes employment injury protection as one of the nine branches of social security. Additionally, the Workers’ Compensation Act of 2000 provides for the creation of a Workers’ Compensation Fund responsible for paying compensation to workers who suffer workplace injuries.

In line with these provisions, the Ministry intends to operationalize the Fund, into which employers will make periodic contributions based on the level of industrial risk associated with their operations. When workplace injuries occur, compensation benefits will be paid directly from the Fund. This marks a shift from the current Employer Liability Scheme to a more sustainable Social Security Scheme.

The 2000 Act further mandates the Workers’ Compensation Trustees Board to oversee and manage the Fund. Establishment of the Fund is expected to generate several benefits, including timely payment of compensation claims, improved financial protection and support for injured workers, reduction in fraudulent compensation claims, reduced direct financial burden on employers, and mobilization of resources for long-term investment and sustainability of the compensation system