Section 76 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 76 fixes how much compensation an employer pays for death and for permanent total, permanent partial and temporary disablement. Death and permanent total disablement use a percentage of monthly wages multiplied by an age factor from the Sixth Schedule; temporary disablement is paid half-monthly; medical expenses and a funeral sum are added.
Death: 50 per cent of monthly wages × the relevant factor, or an amount notified by the Central Government, whichever is more (s.76(1)(a)). Permanent total disablement: 60 per cent × the factor, or the notified amount, whichever is more (s.76(1)(b)). Permanent partial disablement: a percentage of the permanent-total amount (s.76(1)(c)). Temporary disablement: half-monthly payment of 25 per cent of monthly wages (s.76(1)(d)). The employer must also reimburse actual medical expenditure (s.76(5)) and, on death, deposit not less than Rs 15,000 for funeral expenses (s.76(7)).
Why it matters
This is the section that turns an accident into a figure on the balance sheet, and it is easy to under-provide if a company only thinks in terms of an insurance premium. Finance and HR teams should know the formula and its inputs. Our labour law compliance team helps employers check their cover against it. Read with sections 73 to 75 (liability) and section 78 (how "monthly wages" is worked out).
Section 76(1): the four heads
| Head | Compensation | Notes |
|---|---|---|
| (a) Death | 50 per cent of monthly wages × relevant factor, or a notified amount, whichever is more | Central Government may notify |
| (b) Permanent total disablement | 60 per cent of monthly wages × relevant factor, or a notified amount, whichever is more | Same |
| (c) Permanent partial disablement | (i) injury in Part II of the Fourth Schedule: the percentage of the permanent-total compensation specified there as loss of earning capacity; (ii) other injuries: a percentage proportionate to the loss of earning capacity assessed by the medical practitioner | Multiple injuries from one accident are aggregated, but not above the permanent-total amount |
| (d) Temporary disablement (total or partial) | Half-monthly payment of 25 per cent of monthly wages | Payable as in sub-section (4) |
The proviso lets the Central Government enhance the amounts in clauses (a) and (b) by notification. Sub-section (3) lets it specify monthly wages for the purposes of sub-section (1).
The "relevant factor"
The Explanation says the relevant factor is the factor in column (3) of the Sixth Schedule against the completed years of age on the employee's last birthday immediately before the date on which compensation fell due. The Schedule runs from 228.54 (age not more than 16) down to 99.37 (age 65 or more); for instance, age 30 is 207.98 and age 40 is 184.17. The younger the employee, the higher the multiplier.
For partial disablement, the Explanation 2 requires the medical practitioner to have due regard to the percentages the Fourth Schedule gives for different injuries.
Section 76(4): timing of half-monthly payments
The half-monthly payment is payable on the sixteenth day from the date of disablement if it lasts twenty-eight days or more; if it lasts less than twenty-eight days, after a waiting period of three days from the date of disablement; and thereafter half-monthly during the disablement or for five years, whichever is shorter.
Two provisos apply:
- amounts the employee already received from the employer by way of compensation during the disablement are deducted from the lump sum or first half-monthly payment; medical treatment payments are not treated as compensation for this purpose;
- no half-monthly payment may exceed the amount by which half the monthly wages before the accident exceeds half the wages he earns after it.
Where disablement ends before a half-monthly date, a proportionate sum is payable for that half-month (s.76(6)).
Other parts of section 76
- Accident outside India (s.76(2)): the competent authority takes into account compensation awarded under that country's law and reduces the amount fixed by that sum.
- Medical expenses (s.76(5)): the employee is to be reimbursed the actual medical expenditure for treatment of injuries in the course of employment, by the employer.
- Funeral expenses (s.76(7)): on death, in addition to compensation, the employer deposits with the competent authority not less than Rs 15,000, or such amount as the State Government prescribes, for payment to the eldest surviving dependant for funeral costs, or, if no dependant or not living with the employee, to the person who actually incurred the expense. The Central Government may enhance this sum by notification.
A worked example
Take an employee aged 30 with monthly wages of Rs 20,000 (monthly wages are defined in section 78). The relevant factor for age 30 is 207.98.
- Death: 50% × Rs 20,000 = Rs 10,000; × 207.98 = Rs 20,79,800, unless a notified amount is higher.
- Permanent total disablement: 60% × Rs 20,000 = Rs 12,000; × 207.98 = Rs 24,95,760, unless a notified amount is higher.
- Temporary disablement of 40 days: half-monthly payments of 25% of Rs 20,000 = Rs 5,000 per half-month from the sixteenth day, because the disablement exceeds 28 days.
- On death, a further deposit of not less than Rs 15,000 for funeral costs.
These are illustrations of the formula only; check for any notification that raises the amounts or fixes monthly wages.
Which rules apply
Interest on late payment is fixed under rule 57 of the Central Rules and explained in our article on sections 77 and 78. The Central Rules apply where the Central Government is the appropriate Government; where the State Government is, the State's own rules apply, including any State-prescribed funeral amount.
Need help checking compensation exposure?
If you want to test whether your accident cover, provisions and payroll wage records line up with section 76, our labour law compliance team can help.
Key takeaways
- Death: 50% and permanent total disablement: 60% of monthly wages × Sixth Schedule factor, or the notified amount if higher.
- Factor depends on age at last birthday: 228.54 down to 99.37.
- Partial disablement: Fourth Schedule percentage, or medical assessment of loss of earning capacity.
- Temporary disablement: 25% of monthly wages, half-monthly, waiting period of three days if under 28 days; maximum five years.
- Medical expenses are reimbursed in full (actual).
- Funeral deposit of at least Rs 15,000 on death.
Read next
- Sections 77 and 78: Payment of compensation and monthly wages
- Sections 73 to 75: Reports of accidents and employer's liability
- Sections 79 to 81: Review, commutation and distribution of compensation
- Workmen Compensation vs ESI: which applies
Disclaimer: Based on the Code on Social Security, 2020 (as enacted) and, where noted, the Code on Social Security (Central) Rules, 2026 (G.S.R. 344(E), 8 May 2026), as on 30 September 2026. The Code is in force from 21 November 2025; some provisions may be notified later, and State Governments make their own rules for establishments where the State is the appropriate Government. Verify the current position before acting.