THE BRITISH WORKMEN'S COMPENSATION ACT AND ITS

OPERATION.

BY A. MAURICE LOW.

The Workmen's Compensation Act, (a) which received the royal assent August 6, 1897, and came into operation July 1, 1898, marks an advanced step in social legislation in Great Britain. It was regarded by the workingmen not as a finality, but simply as the first stage. It was resisted by the employers because it was feared that it would be a heavy drain on their profits and encourage more drastic legislation in the near future.

That the act was considered as tentative and not as the last word in legislation is shown from the fact that it was made to apply to certain classes of labor only and brought within its scope rather less than 50 per cent of the wage-workers of the United Kingdom. These figures are not official, because no official data can be obtained. So far as the writer has been able to ascertain, after carefully weighing the different calculations made by men whose opinions are of value, the benefits of the act applied to about 6,000,000 men and excluded some 7,000,000. Since then, by the amendment adopted at the last (1900) session extending the act to agricultural laborers, (b) the balance has been turned in the other direction.

During the two years in which the law has been in operation it has not satisfied all of the sanguine hopes of its promoters, nor has it been attended by the dire consequences predicted. But it must be added that the law has not as yet had to stand the supreme test of all economic laws, a falling market, without which no proper verdict as to the value of any theory can be reached. During the brief period the law has been in force there has been a demand greater than the output for nearly all forms of manufactured articles, and labor has found stealy and remunerative employment at constantly increasing wages. In some trades there has been a scarcity of labor, especially since the outbreak of hostilities in South Africa, which seriously affected the labor market by the withdrawal of men from gainful operations to join the colors. This fact can not be too strongly emphasized. Both employers and employees agree that the real merits and defects of the

a60 and 61 Vict., chap. 37.

¿Law of July 30, 1900, the provisions of which enter into force July 1, 1901.

law, its advantages and disadvantages, can only be determined when there is a time of stress, when capital can not find a productive return, and when labor can not find employment and the wage scale declines.

ANALYSIS OF THE LAW.

The act in extenso will be found at the end of the article, but as frequent reference is made to it, the principal sections are here summarized:

If an injury is caused to a workman by an accident arising out of and in the course of his employment, his employer shall be liable for its compensation in accordance with the first schedule, the more important provisions of which follow:

Where death results from the injury if the workman leaves dependents wholly dependent upon his earnings, the compensation shall equal his earnings in the employment of the same employer during the 3 years preceding the injury, or the sum of £150 ($729.98), whichever is the larger, but must not exceed £300 ($1,459.95). If the employment has been less than 3 years, the amount of earnings shall be deemed to be 156 times the average weekly earnings during the period of actual employment.

If the workman leaves dependents only in part dependent upon his earnings, the compensation may be determined by agreement or arbitration under this act, but must not exceed the amount payable under the foregoing provision.

If no dependents are left, the reasonable expenses of medical attendance and burial are to be paid, not exceeding £10 ($48.67).

Where total or partial incapacity for work results from the injury a weekly payment must be made during incapacity after the second week, not exceeding 50 per cent of the workman's average weekly earnings during the previous 12 months, if he has been so long employed, but if not, then for any less period spent in the employment of the same employer, such payment not to exceed £1 ($4.87).

No employer shall be liable for an injury which does not disable the workman for a period of at least 2 weeks from earning full wages, or for an injury due to the serious or willful misconduct of the workman.

In fixing the weekly payment the difference between the average weekly earnings before and after the accident must be considered, ast well as any payment not wages received from the employer during the incapacity.

Where a workman has given notice of an accident he shall, if required by the employer, be examined by a medical practitioner provided by the employer, and if he refuses or obstructs the examination his right to compensation shall be suspended until the examination takes place. Payment shall, in case of death, be made to the legal personal rep

resentative of the workman, or, if he has none, to his dependents. If he leaves no dependents, payment is made to the person to whom the expenses are due.

Any question as to who is a dependent, or as to the amount payable to each dependent, shall, in default of agreement, be settled by arbitration.

The sum allotted as compensation to a dependent may be invested or otherwise applied for his benefit, as agreed or as ordered by the committee or other arbitrator.

Any workman receiving weekly payments under this act shall, if required by the employer or by any person by whom the employer is entitled to be indemnified, from time to time be examined by a medical practitioner provided by the employer or such other person; but if the workman objects to such examination or is dissatisfied with the certificate, he may be examined by one of the medical practitioners appointed for the purposes of this act, as mentioned in the second schedule, and the certificate of that practitioner shall be conclusive evidence of the workman's condition. If he refuses to take the examination, or in any way obstructs it, his right to the weekly payments shall be suspended until the examination has taken place.

Any weekly payment may be reviewed at the request either of the employer or of the workman, and the amount of payment shall, in default of agreement, be settled by arbitration.

Where a weekly payment has been continued for not less than 6 months, the liability therefor may, on the application of the employer, be redeemed by the payment of a lump sum.

A weekly payment shall not be assigned, charged, or attached, and shall not pass to any other person by operation of law; nor shall any claim be set off against the same.

The act shall not affect the civil liability of the employer. A workman may, at his option, claim compensation under the act or seek the same remedy that was open to him before its passage; but the employer shall not be liable under more than one act.

If the question of liability is not settled by agreement, provision is made for arbitration.

Nothing in the act shall affect any proceeding for a fine under the factories and mines acts, but if the fine has been applied for the benefit of the person injured, that amount shall be taken into account in estimating the compensation.

Proceedings for recovery of compensation for an injury shall not be maintainable unless notice of the accident has been given as soon as practicable and before the workman has voluntarily left the employment in which he was injured, and unless the claim for compensation has been made within six months from the occurrence of the accident causing the injury, or, in case of death, within six months from the

time of death. Defect or inaccuracy in the notice shall not be a bai to the maintenance of the proceedings, if it is found in the proceedings for settling the claim that the employer is not prejudiced in his defense by the defect or inaccuracy, or that the defect or inaccuracy was occasioned by mistake or other reasonable cause.

Notice in respect of an injury shall give the name and address of the person injured, and shall state in ordinary language the cause of the injury and the date at which it was sustained, and shall be served on the employer.

If the registrar of friendly societies, after taking steps to ascertain the views of the employer and the workmen, certifies that any scheme of compensation, benefit, or insurance is on the whole not less favorable to the general body of workmen and their dependents than the provisions of the act, the employer may, until the certificate is revoked, contract with any workman that the provisions of the scheme shall be substituted for the provisions of the act, and in that case he shall be liable only in accordance with the scheme.

No scheme shall be certified which contains an obligation upon the workmen to join the scheme as a condition of their hiring.

If complaint is made to the registrar of friendly societies on behalf of the workmen that the provisions of any scheme are no longer on the whole so favorable to the general body of workmen of an employer and their dependents as the provisions of the act, or that the provisions of the scheme are being violated, or that the scheme is not being fairly administered, or that satisfactory reasons exist for revoking the certificate, the registrar shall examine into the complaint, and, if satisfied that good cause exists for it, shall, unless the cause is removed, revoke the certificate.

A contractor shall be liable for injury caused to a workman in the employment of a subcontractor.

Where an employer insures his liability for accident and becomes bankrupt with unsatisfied claims against him by his workmen, they shall have a first charge upon the insurance money for the amounts due them.

The act applies only to employment on, in, or about a railway, factory, mine, quarry, or engineering work, and to employment on, in, or about any building which exceeds 30 feet in height, and is either being constructed or repaired by means of scaffolding, or is being demolished, or on which machinery driven by steam, water, or other mechanical power is being used for the purpose of its construction, repair, or demolition.

A careful examination of the act will show that it aims to accomplish three things: (1) To provide a method of compensation for accidents not due to the employee's negligence, unlike the attempts here

tofore made to enforce the employer's liability, and at the same time differing from the German scheme of compulsory insurance; (2) to make the original "undertaker" liable for the acts of a subcontractor; (3) to abolish-by inference only, but with all the practical result of direct enactment-the doctrine of "common employment." While conferring these benefits, the law restricts the employee from recovering compensation if the injury was due to his serious and willful misconduct; and where he was entitled to compensation under the act it does not prohibit him from seeking his remedy under existing law if he so elects.

In pursuing the present investigation the endeavor has been to ascertain the general working and application of the law, its influence upon production and profits, whether it has been of any advantage to labor, and whether it has had any effect in improving the relations between capital and labor.

GENERAL WORKING AND APPLICATION OF THE LAW.

In view of the line of inquiry adopted, it has seemed to the writer that it is valuable and instructive to show how the proposed legislation was regarded before it came into being, and how far the predictions then made have been verified.

CONTRACTING OUT.

Attention must be called to the constant fear expressed by labor that the contracting out" clause would cause the workingmen serious injury, because it substituted for the personal and human responsibility of the individual employer the impersonal and mechanical liability of a corporation whose only interest would be to escape payment as frequently as possible. But experience has shown that, while in many respects the act is defective and has given rise to litigation, which was the very thing its authors claimed it would abolish, the authority given to employers and employees to agree on a mutually satisfactory arrangement has worked admirably. In fact, as pointed out by Mr. Brabrook, the chief registrar of friendly societies, whose sanction is necessary before any scheme becomes operative, the term “contracting out" is a misnomer. The arrangement made between masters and men is not a contraction out of the scope of the law, but is, rather, bringing both parties more narrowly within its provisions.

This provision of the act is worthy of the careful consideration of observers of economic legislation, because both sides to the agreements regard them as a decided step in harmonizing the relations between capital and labor, and also because they have been found to give general satisfaction and to minimize litigation.