THE PAYMENT OF WAGES ACT, 1936

OBJECT OF THE ACT

• To regulate the payment of wages to certain classes of employed persons. Two fold:-

• First the date of payment of wages and

• Secondly the deductions from wages whether as fine or otherwise.

APPLICABILITY OF THE ACT

• Persons employed in:-• Any factory (a saw mill, ginning factory, godowns, yards etc as

defined in Factories Act, 1948).• Tramway service or motor transport service engaged in

carrying passengers or good or both by road for hire or reward.

• Air transport service Dock, Wharf or Jetty, Inland vessel, mechanically propelled

• Mine, quarry or oil-field plantation

• Workshop or other establishment etc.

WAGE

• Wage includes any remuneration:-• Payable under any award or settlement between the parties

or order of a Court;• Over time work or holiday or any leave period;• Any additional remuneration under the terms of

employment.

Wage does not includes any bonus, pension fund or provident fund, travelling allowance and any gratuity.

WAGES TO BE PAID IN CURRENT COINS OR CURRENCY NOTES

a. All wages shall be paid in current coins or currency notes or in both.

b. After obtaining the authorization, either by Cheque or by crediting the wages in employees banks Account {Section 6}

Andhra Pradesh State Amendment: “Provided further that the State Government may, by notification in the Andhra Pradesh Gazette, specify the industrial establishments , the employers of which shall pay to the persons employed therein, the wages either by cheque or by crediting the wages in their bank account”-[Vide Andhra Pradesh Act 15 of 1982, sec.2 (w.e.f 7-10-1982).

TIME OF PAYMENT OF WAGES

• The wages of every person employed is paid. When less than 1000 persons are employed shall be paid before the expiry of the 7th day of the following month. When more than 1000 workers, before the expiry of the 10th day of the following month. (Section 5).

• Drawing average wage upto Rs.6500 pm as amended with effect from 6th September 2005.

COVERAGE OF EMPLOYEES

DEDUCTION MADE FROM WAGES

• Deductions such as, fine, deduction for amenities and services supplied by the employer, advances paid, over payment of wages, loan, granted for house-building or other purposes, income tax payable, in pursuance of the order of the Court, Provident Fund contributions, cooperative societies, premium for Life Insurance, contribution to any fund constituted by employer or a trade union, recovery of losses, Employees State Insurance contribution etc. (Section 7).

DEDUCTION FOR ABSENCE FROM DUTIES FOR UNAUTHORISED ABSENCE

• Absence for whole or any part of the day – If ten or more persons absent without reasonable cause, deduction of wages upto 8 days {Section 9}

DEDUCTION FOR DAMAGE OR LOSS

• For default or negligence of an employee resulting into loss. Show cause notice has to be given to the employee. {Section 10}

DEDUCTIONS FOR SERVICE RENDERED

• When accommodation amenity or service has been accepted by the employee. {Section 11}

• Deductions for recovery of Advance.• Deduction for recovery of loans.• Deductions for payment to co-operative

societies and Insurance schemes.

AUTHORITIES UNDER THIS ACT

• INSPECTORS.• AUTHORITY TO HEAR CLAIMS.Any commissioner for Workmen’s Compensation; orAny Regional Labour Commissioner.Any Assistant Labour Commissioner.Presiding Officer of any Labour Court or Industrial Tribunal.

APPEAL

An Appeal may be preferred from the following orders or directions ofthe Authority:-an order directing the employer or the persons responsible for payment of wages, to refund the deductions wrongfully made or to pay the delayed wages;an order directing payment of compensation to the employee under Section 15(3);an order imposing penalty whether on the employee or the employerunder Section 15(4).An Appeal can be made within thirty days of the date on which the order or direction was made before the District Court within whose jurisdiction the industrial establishment is situated.

PENALITIES

• Makes contravention of Sec’s.5, 7, 9, 11 and 13 of the Act, by

any person responsible for the payment of wages to an

employed person, punishable with fine which shall not be less

than one thousand five hundred rupees but which may

extend to seven thousand five hundred rupees.