Payment of Wages Act
1936
Payment of Wages Act 1936
Extent and Application
It extends to whole of India
It shall be applicable to the payment of wages in
all the industries.
Payment of Wages Act 1936
Definitions
Wages: means all remuneration expressed in terms of
money or capable of being so expressed, which
would be payable to a person employed in respect of
his employment if the terms of employment, express
or implied were fulfilled.
and includes (a) any remuneration payable under any award or
settlement
(b) any remuneration of overtime work or holidays or any
leave period;
(c) any additional remuneration payable under the terms
of employment
(d) any sum which by reason of the termination of
employment of the person employed is payable under any
law, contract or instrument.
(e) any sum to which the person employed is entitled
under any scheme framed under any law for the time being
in force,
Payment of Wages Act 1936
but does not include(1) any bonus
(2) the value of any house-accommodation, or of the supply of
light, water, medical attendance or other amenity or of any service
excluded from the computation of wages by a general or special
order of the State Government;
(3) any contribution paid by the employer to any pension or
provident fund, and the interest which may have accrued thereon;
(4) any traveling allowance or the value of any traveling
concession;
(5) any sum paid to the employed person to defray special
expenses entailed on him by the nature of his employment; or
(6) any gratuity payable on the termination of employment.
Payment of Wages Act 1936
Responsibility for payment of wages
Every employer shall be responsible for the
payment to persons employed by him of all wages
required to be paid.
Fixation of wage-periods
Every person responsible for the payment of wages
shall fix periods in respect of wages to be payable.
No wage-period shall exceed one month.
Payment of Wages Act 1936
Time of payment of wages
The wages of every person employed in(a) any railway, factory or industrial establishment
in which less than 1000 persons are employed,
shall be paid before the expiry of the seventh day,
(b) any other railway, factory or industrial
establishment, shall be paid before the expiry of
the tenth day.
Payment of Wages Act 1936
Where the employment of any person is terminated
by the employer, the wages, earned by him shall be
paid before the expiry of the second working day
from the day on which his employment is terminated.
Payment of Wages Act 1936
Wages to be paid in current coin or currency
notes
All wages shall be paid in current coin or currency
notes or in both
Provided that the employer may, after obtaining
the written authorisation of the employed person,
pay him the wages either by cheque or by crediting
the wages in his bank account.
Payment of Wages Act 1936
Deductions which may be made from wages
Deductions may be of the following kinds only, namely
(a) fines
(b) deductions for absence from duty
(c) deductions for damage to or loss of goods
(d) deductions for house-accommodation supplied by the employer
(e) deductions for recovery of advances
(f) deductions for recovery of loans made
(g) deductions of income-tax payable
(h) deductions required to be made by order of a court
(i) deductions for payment of provident fund
(j) deductions for payments to co-operative
Payment of Wages Act 1936
the total amount of deductions which may be made
in any wage-period from the wages of any
employed person shall not exceed(i) in cases where such deductions are wholly or
partly made for payments to co-operative societies,
seventy-five per cent of such wages, and
(ii) in any other case, fifty per cent of such wages
Payment of Wages Act 1936
Fines
No fine shall be imposed on any employed person in
respect of any acts and omissions on his part until he
has been given an opportunity of showing cause
against the fine.
The total amount of fine in any one wage-period on
any employed person shall not exceed an amount
equal to 3% of the wages payable to him.
No fine shall be imposed on any employed person
who is under the age of fifteen years.
Payment of Wages Act 1936
Deductions for absence from duty
Deductions may be made on account of the
absence of an employed person from the place
where, by the terms of his employment, he is
required to work.
Such absence being for the whole or any part of
the period during which he is required to work.
Payment of Wages Act 1936
Deductions for damage or loss
A deduction shall not exceed the amount of the damage
or loss caused to the employer by the neglect or default
of the employed person.
Deductions for services rendered
A deduction shall not be made from the wages of an
employed person, unless the house-accommodation
amenity or service has been accepted by him.
such deduction shall not exceed an amount equivalent to
the value of the house-accommodation amenity or
service supplied
Payment of Wages Act 1936
Deductions for recovery of advances
recovery of an advance of money given before employment
began shall be made from the first payment of wages in
respect of a complete wage-period.
Deductions for recovery of loans
Deductions for recovery of loans granted shall be subject to
any rules made by the State Government regulating the
extent to which such loans may be granted and the rate of
interest payable thereon.
Payment of Wages Act 1936
Deductions for payments to co-operative societies
and insurance schemes
Deductions shall be subject to such conditions as the
State Government may impose.
Maintenance of registers and records
Every employer shall maintain registers and records
giving particulars of persons employed by him, the work
performed by them, the wages paid to them, the
deductions made from their wages, the receipts given by
them, etc.
Payment of Wages Act 1936
Penalty for offences under the Act
Whoever contravenes any of the provisions relating
to payment shall be punishable with fine of Rs. 200/which may extend to Rs. 1,000/-.
Whoever contravenes the provisions relating to
fixation of wage period shall be punishable with fine
of Rs. 500/-
Payment of Wages Act 1936
Whoever fails to maintain any register and records
and denies to produce before the Inspector shall be
punishable with Rs. 200/- which may extend to Rs.
1,000/-
Whoever prevents Inspector from doing his duty
shall be punishable with Rs. 200/- which may
extend to Rs. 1,000/-
