The Payment of Wages Act, 1936

Purpose: To regulate payment of wages, disbursement of wages within the prescribed time limit and without any deduction except those authorized by law. Came into effect from 23- - !"3#. Scope and coverage - $ayment of wages to persons: a% employed in any factory, b% employed upon any railway by a railway administration or, either directly or through a subcontractor, c% employed in an industrial or other specified establishments. d% Tramway ser&ice or motor transport ser&ice engaged in carrying passengers or goods by road. e% 'ir transport ser&ices other than exclusi&ely employed in the military, na&al or air force. f% (oc), *ine, +uarry, or oil field, plantation g% ,stablishment in which any wor) relating to the construction, de&elopment or maintenance of buildings, roads, bridges or canals, irrigation, water supply etc. h% 'ny other establishment which the central go&ernment or state go&ernment need to protect the interest of employed persons. *aharashtra: ,stablishments co&ered by the -ombay .hops / ,stablishments 'ct.

Ob ect!ves - 0a% To ensure regular and prompt payment of wages to certa!n c"ass of persons1 b% (isbursement of wages within the prescribed time limit1 and c% To pre&ent the exploitation of a wage earner by prohibiting arbitrary fines and deductions from his wages. Thus the ob2ect is 0i% to a&oid unnecessary delay in payment of wages1 and 0ii% to pre&ent unauthorized deductions. .ec. !0#%: The 'ct shall apply only when average month"y #ages are "ess than $s% 1&,'''(-%

WA)*S+ .ec. 2034%: all remuneration5 expressed in terms of money or capable of being expressed in terms of money payable to an employed person. Wages !nc"ude: a% 'ny remuneration payable under any award or settlement or order of a court. b% 6emuneration for o&ertime wor) or holidays or any lea&e period. c% 'ny additional remuneration 0incenti&es etc.% d% 'ny sum payable under a contract or otherwise upon termination of employment 0but not a retirement benefit%. e% 'ny sum payable under any scheme in force. Wages do not !nc"ude: !% 'ny bonus, not forming part of remuneration payable under the terms of employment, any award, or settlement or order of a court. 2% 3alue of any house accommodation, light, water etc. 3% Contribution by employer to any pension or pro&ident fund and the interest thereon. % 'ny tra&eling allowance or concession 7% 'ny sum paid towards expenses necessitated by employment #% 'ny gratuity payable on termination of employment. Prov!s!ons for Payment of Wages: 0.ec. 3 to #%: 8ho is responsible for payment: .. 3: ,mployer, his representati&e, manager of the factory 5person who employs. Wage Per!od: .. : $eriod in respect of which wages shall be payable. 9o wage period shall exceed one month in any case. T!me of Payment: .. 7: 0!% 0a% where less than !::: persons employed ; before the expiry of the <th day, 0b% 'll other establishments - before the expiry of the !: th day. 02% Termination of employment ; before the expiry of 2 nd wor)ing day on which his employment is terminated. 03% 'll payment of wages... on a wor)ing day. ,ed!um of Payment: .. #: 4n current coins= currency notes. 4f authorized, payment by che+ue or crediting in ban) account.

,aharashtra -ot!f!cat!on dated 1&th .ecember, /'1'+ 'll wages payable to the employed persons 0in continuous ser&ice as per 4ndustrial (isputes 'ct% and are drawing wages of 6s. 3:::=- per month or more, except agricultural and sugarcane cutting labourers, shall be paid either by an account payee che+ue drawn in fa&our of the employed persons or by crediting the wages in his=her ban) account. >urther, the limit of 6s. 3,:::=- is not applicable to the employed persons in the area of Thane district.

.educt!on from Wages: 0.ec. < to !3%: 'n employed person entitled to recei&e wages without deduction except authorized under the 'ct. 8ithholding of increment or promotion, stoppage of increment, reduction to a lower post and suspension, if as per the rules, shall not amount to deduction. >ollowing )inds of deductions are permitted: a% fines1 b% deductions for absence from duty1 c% deductions for damage to or loss of goods or money of the employer, if such damage or loss is due to his neglect or default. d% deductions for house accommodation made a&ailable by the employer, go&ernment or any housing board. e% deductions for amenities and ser&ices supplied by the employer f% deductions for reco&ery of ad&ances and interest due thereon or ad2ustments of o&er payment of wages g% deductions for reco&ery of loans from any fund constituted for the welfare of labour and interest due thereon h% deductions for reco&ery of loans granted for house building etc. i% deductions for income tax payable by the employed person 2% deductions, under the order of the court or other authority )% deductions for payment to cooperati&e societies etc. l% deductions, with the written authorization of the employed person: 0a% for life insurance premium, 0b% for purchase of ?o&t. securities, 0c% deposits in post office sa&ings a=c, 0d% contribution to a Trade @nion.

There are also certain deductions peculiar to railways... deductions for reco&ery of losses sustained on account of certain omissions and commissions, due to the neglect or default of the employee. Tota" amount of deduct!ons !n any #age per!od ... shall not exceed <7A of the wages where such deductions were wholly or partly made for payment to cooperati&e societies1 and in any other case it shall not exceed 7:A of the wages. 01-*S: .. B: Conditions and limits for imposing fines: !% Cnly for such acts or omissions as are specified by the employer and are appro&ed by the .tate ?o&ernment. 2% 9otice specifying such acts or omissions shall be exhibited on the premises where the employment is carried on. 3% $erson fined shall be informed in writing specifying reasons for imposing fine. % 9o fine to be reco&ered, if employed person under the age of !7. 7% >ine not to be reco&ered by installments and shall be reco&ered within ": days. #% Total amount of fine in one wage period shall not exceed 3A of the wages for that period. <% 'll realizations by way of fines... to be recorded... money is applied for the benefit of the employed persons. .educt!on for absence from duty: .. ": 4t shall ne&er be more than what the employed person would ha&e earned had he not remained absent from duty. Dowe&er, if !: or more employed persons, acting in concert, remain absent without due notice and without reasonable cause, the deduction may be up to B days of wages in lieu of notice. 'n employed person on stri)e, where it is illegal and un2ustified shall be deemed to ha&e remained absent from duty. Tool down or stay-in stri)e also amounts to absence from duty. ,mployer can deduct wages for absence on the principle of Eno wor), no payF1 howe&er, in case wor)men were, in fact present and were ready to attend the wor) but they were physically pre&ented from attending duty by miscreants or organizers of EbundhF then deduction from wages would not be 2ustified. .educt!ons for damage or "oss : .. !:: 4t shall not exceed the actual amount of damage or loss caused to the employer by the neglect or default of the employed person. (eductions are permitted only after the .C9 and hearing in the matter.

*mp"oyer2s "!ab!"!ty upon death of an emp"oyed person+ 4n case of death of an employed person or in case his=her whereabouts are un)nown, all amount payable to him as wages shall either be paid to the nominee or shall be deposited with the prescribed authority u=s. 27, whereupon employer shall be discharged of his liability to pay the wages. 1nspectors+ 4nspectors under the >actories 'ct5 .tate ?o&t. is authorizes to appoint other inspectors under the 'ct. 'n 4nspector is entrusted with the authority to ascertain whether the pro&isions of the 'ct and the 6ules are properly implemented or not. They ha&e wide powers... employer to afford all reasonable facilities... @nder .ec. !7, the .tate ?o&t. may appoint a competent person to be the 'uthority to hear and decide all claims arising out of the deductions from wages or delay in payment of wages etc. The aggrie&ed person may submit an application within !2 months. 'ppeal against the order lies to the Court of .mall Causes or the (istrict Court. .ec. 2:: $enalty for offences ranges from 6s. 2::=- to 6s. 3:::=-. .ec. 23: any agreement whereby an employed person relin+uishes his rights under the 'ct, such an agreement shall be &oid.

Ob"!gat!ons of *mp"oyer under the Act o To pay wages to the persons employed by him. o To fix wage periods and this shall not exceed one month. o To pay wages before the expiry of < th day after the last day of the wage period where total number of employed persons is less than !:::1 and before the expiry of the !:th day where number of employed persons exceeds !:::. o To pay wages in current coin and currency notes. o 9ot to ma)e deductions of any )ind except those authorized by the 'ct. o To maintain registers and records gi&ing particulars of persons employed, the wor) performed by them, the wages paid and the deductions made from their wages. o 9ot to enter into any agreement with an employed person whereby he relin+uishes any right a&ailable to him under the 'ct. o To display 9otice containing the abstract of the 'ct and rules at a prominent place in the establishment in ,nglish and in the language understood by the ma2ority of the employed persons.

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