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PAYMENT
OF WAGES ACT, 1936
Objectives
The
payment of Wages Act, 1936 was introduced with the object
of (a) regulating payment of wages, imposition of fines
and deductions from wages, and (b) eliminating all malpractices
by laying downwage periods and time and mode of payment
of wages.The Act, therefore, ensures payment of wages
in a particular form at regular intervals without unauthorized
deductions.
Applicability
The
Act applies to any factory, any railway establishment
and any industrial or other establishment like tramway
service, motor transport service, air transport service,
dock, wharf, jetty, inland vessel, mine, quarry, oilfield,
plantation, workshop or other establishment producing,
adapting or manufacturing any article, establishments
engaged in construction, developmentand maintenance
of buildings, roads, bridges or canals, navigation,
irrigation or supply of water, generation, transmission
and distribution of electricity/power and any other
establishment notified by the Central or a State Government.
Eligibility
The
Act is applicable to the employees receiving wages below
Rs. 1,600/- per month.Persons employed in a railway
establishment, either directly or through a contractor,
are also covered under the Act.
Wages
‘Wages’
means allemoluments expressible in terms of money and
payable to an employee including any sum payable for
termination of service, wages in lieu of holidays or
leave, overtime wages and bonus payable under the Bonus
Act or under the terms of employment.However, ‘wages’
does not include value of any house accommodation, supply
of light, water, medical attendance or any other amenity,
contribution to any pension or provident fund, travelling
allowance, reimbursement of any special expense and
gratuity.
Nor
does it include suspension/subsistence allowance given
during suspension period of an employee.
Obligations
of Employers
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Every
employer is primarily responsible for payment of
wages to his employees.
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Every
employer should fix the wage-period, which may be
per day, per week or per month, etc., but in no
case it should exceed one month.
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Employer
should make timely payment of wages. If the number
of employees is less than 1000, then wages must
be paid within 7 days of the expiry of the wage
period, and in other case within 10 days of the
expiry of the wage period. Besides, all payments
of wages should be made only on a working day.
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Wages
should be paid in cashor by cheque or by crediting
in employee’s bank account, after obtaining
his written consent.
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The
employer should not make any unauthorized deductions
from wages.Employer can make permissible deductions
such as for income tax, recovery of loans and advances,
employee’s subscription to provident fund,
and with his written consent for payment of life
insurance premium, purchase of Government securities,
deposits in any Post Office Savings Bank, contributions
to any labor welfare fund and fees for membership
of any trade union, etc. etc.
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In
case of death of an employee, all amounts payable
to him as wages should be paid to his nominee or
legal heir.
MINIMUM
WAGES ACT, 1948
Objectives
The
Minimum Wages Act, 1948 envisages to provide minimum
statutory wages for scheduled employments with a view
to obviate the chances of exploitation of labor through
payment of very low and sweating wages. The Act also
provides for the maximum daily working hours, weekly
rest day and overtime.Rates fixed under Minimum Wages
Act prevail over the rates fixed under award/agreement.
Applicability
The
Act applies to all establishments employing one or more
persons and engaged in any Scheduled employment.
Wages
‘Wages’
means all remuneration expressible in money terms and
payable to an employee including house rent allowance
but excluding value of any house accommodation, supply
of light, water, medical attendance or any other amenity,
contribution to any pension or provident fund, travelling
allowance, reimbursement of any special expense and
gratuity.
If
the commission on turnover is being paid as per terms
and conditions of employment, then it would constitute
part of the wages even under the Minimum Wages Act.However,
an employee should not be paid wages including the commission,
which are less than the prescribed minimum wages.
Fixation
of Minimum Rates of Wages
The
State Governments have been empowered to fix rates of
wages for different classes of employees -skilled, unskilled,
clerical, supervisory, etc. employed in any Scheduled
employment and to review and revise the same from time
to time, the interval between two revisions not to exceedfive
years, considering the change in price index and dearness
allowance.
Fixation
of Working Hours, etc.
In
regard to any scheduled employment in respect of which
minimum rates of wages have been fixed, the Government
may-
- fix
the number of working hours constituting a normal
working day, inclusive of one or more intervals;
- provide
for a rest day with wages, in every period of 7 days;
and
- provide
for payment for work on a rest day at a rate not less
than the overtime rate.
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