Employment injury insurance: A boon for the workers

Abdul Kadir Dip | Published: January 29, 2015 00:00:00 | Updated: November 30, 2024 06:01:00

Employment Injury Insurance Programme (EIIP) is an insurance mechanism for providing financial benefits to employees injured in workplaces during the tenure of employment. This insurance, in essence, covers physical injuries, accidental deaths and occupational diseases. The EIIP can do more for the well-being of the workers and/or their dependents than a conventional insurance policy in that it addresses the issue of in-kind health care and the rehabilitation of the injured employees in the financial, medical and vocational formats.
Typically employment injury is a built-in coverage under the employer liability insurance in some Asian countries. The EIIP has successfully been recognised for protecting workers' rights and establishing harmonious industrial relationship. Moreover, EIIP is administered on low cost and no-fault basis which means that the premium charged would be the least and the employers would be strictly liable to comply with the obligations. Strict liability is the liability without any fault on the employer's part in the incidents of worker's injury, and is imposed by law on the employers because of their socially and economically privileged positions. Â
STATE OF WORKPLACE ACCIDENTS IN BANGLADESH: Recent statistics from International Labour Organisation (ILO) shows that every year 2.3 million people (6,300 per day) die from workplace accidents and occupational diseases and the resultant economic loss amounts to $1.25 trillion (roughly 04 per cent of the global GDP). In Ready-Made Garments (RMG) sector of Bangladesh, the recent-past incidents of physical injuries and death toll, particularly in the collapse of the Rana plaza and the fire incident of Tajreen Fashions have seriously tainted the country's image to the buyers' community and subsequently many pressure groups and rights organisations have raised their voice for workplace safety and security of the workers.
Â In this regard, the concerns from the EU and the USA, the top consumers of our RMG products, need to be addressed meticulously for the sake of the survival of the industry. Optimistically enough, the government, till date, has taken corrective measures in order to upgrade the working environment of more than 16,000 RMG factories. Along with this, compensation package and rehabilitation programmes for injured workers have to be recognised with due importance. All concerned stakeholders should extend their hands to the public agencies so as to ensure safe place, safe plant and safe system for the country's workforce.
EIIP ACROSS THE GLOBE: Majority of the developing countries whose economies are more or less dependent on RMG exports have already adopted EIIP, such as Cambodia, Malaysia, Thailand and Korea where they have either adopted EIIP or updated the employers' liability insurance to a national insurance scheme for the workers.
With regard to financial aids for the affected families, the existing compensation scheme in our country is, no doubt, inadequate in terms of purchasing power of the taka. A fixed amount of BDT 100,000 (USD 1,250) is paid for death of a worker and BDT 125,000 for permanent disability. The payouts for temporary disability and illness are far below the actual medical expenses usually incurred. The role here played by BGMEA is reportedly not satisfactory. That is why, state intervention is required. In the UK, the government has effectively shifted its responsibilities to the insurance industry making it compulsory for the employers to have liability insurance for a liability of at least Â£5 million under Employers' Liability (Compulsory Insurance) Act 1969.
ILO WORKSHOP ON EIIP: A stakeholders' workshop on "Employment Injury Insurance Programme" (EIIP) was organised by the ILO country office in Bangladesh on January 24, 2015 for exchanging views and experiences regarding workplace injuries, accidents and fatalities recently experienced in Bangladesh, particularly in the RMG sector. Experts illustrated the technical aspects, designing and feasibility of EIIP for Bangladesh which may be covered under future national legislations.
EIIP AT A GLANCE AS PROPOSED BY ILO: The coverage encompasses all workers from the first day of employment. The benefit offered for income protection includes temporary disablement, permanent disablement of the workers and cash benefits for dependents and funeral expenses for the deceased workers. Furthermore, it also includes in-kind health care for treatment and rehabilitation of injured workers. The rate of contributions varies from country to country, for example -- the rate of contribution by the employers in Cambodia and Malaysia are 0.80 per cent and 1.25 per cent respectively. Roughly, the contribution to be paid by an employer for a worker will be BDT 03 per day (Â£1 dollar per month), says senior actuarial advisors of ILO, Mr. Gilles Binnets. The EIIP effectively blends short term and long term benefit through accumulation of funds from which benefits are paid over decades in the event of permanent disability.
Â ADMINISTRATION OF PROPOSED EIIP: As practised worldwide, a designated public agency is in charge of coordinating the activities/performances in the application of the laws and regulations. A public agency may operate through regional offices each of which being composed of two units: 1) Coverage of employers and workers unit -- to be responsible for the supervision of registration for the employees, collection of contribution, maintaining workers' database, monitor compliance with the regulations and conduct labour inspection; 2) Claim process unit - to be responsible for paying cash benefit, healthcare services, implementing rehabilitation programme, supporting the victims and handling complaints and appeals.
ROADMAP FOR EIIP IMPLEMENTATION IN BANGLADESH: Like other developing countries of the world, some forms of compulsory social security system must be in place in Bangladesh for providing benefits to the injured workers. The concerned authority should arrange dialogues among the employers, workers, government bodies and buyer groups. It is expected that a national dialogue on this timely issue can result positively in the implementation of EIIP in Bangladesh.
To sum up, in order for Bangladesh to become a middle income country as per the World Bank's Human Resource Index and for smooth functioning of the RMG industry, measures for safe and secure workplace, together with appropriate compensation package for injured workers, have to be ensured. Introduction of EIIP, initially for the garment workers under a public agency in collaboration with private sector insurance companies, can make headway.
abdulkadir@reliance-bd.com