Objectives
It is an Act to regulate the payment of wages and to eliminate all malpractice by laying down wage periods and time for making payment, arid regulating impositions of fines and deductions from wages. The main objective of the Act is to ensure regular payment of the wages to the employees and to curb u~autliorised deductions from their wages.
Scope and Coverage
The Act extends to the whole of India. It applies to all factories, railway establishment and various industrial establishments such as tram ways, motor transport, dock, wharf, jetty, mines, quarrys, oil field, plantatio~l and establishments producing, adopting or manufacturing ,my article, establishments engaged in construction, development and maintenance of buildings, roads, bridges or canals, navigation, irrigation or supply of water, generation, transmission and distribution of electricity or any other form of power.The Central Government or the State Government may extend the provisions of the Act to any other establishment by giving three months notice which in its opinion needs the protection of person employed therein and taking other relevant consideration into account. by issuing notification in the official gazette.Nothing in this Act shall apply to a person who is drawing monthly wage of Rs. 1,600 or more.
Administration
The Act is administered by the central government in case of railways, mines, oil field, air transportation services. In case of all other industrial establishments and factories, it is administered by the concerned State Government where the appoint the establishment is situated. Both Central as well as State Gover~inie~it Inspectors under the provisions of this Act and make rules to implement and enforce the Act in the establishments under their respective control.
Main Provisions of the Act
Fixation of Wage Period
It is an Act to regulate the payment of wages and to eliminate all malpractice by laying down wage periods and time for making payment, arid regulating impositions of fines and deductions from wages. The main objective of the Act is to ensure regular payment of the wages to the employees and to curb u~autliorised deductions from their wages.
Scope and Coverage
The Act extends to the whole of India. It applies to all factories, railway establishment and various industrial establishments such as tram ways, motor transport, dock, wharf, jetty, mines, quarrys, oil field, plantatio~l and establishments producing, adopting or manufacturing ,my article, establishments engaged in construction, development and maintenance of buildings, roads, bridges or canals, navigation, irrigation or supply of water, generation, transmission and distribution of electricity or any other form of power.The Central Government or the State Government may extend the provisions of the Act to any other establishment by giving three months notice which in its opinion needs the protection of person employed therein and taking other relevant consideration into account. by issuing notification in the official gazette.Nothing in this Act shall apply to a person who is drawing monthly wage of Rs. 1,600 or more.
Administration
The Act is administered by the central government in case of railways, mines, oil field, air transportation services. In case of all other industrial establishments and factories, it is administered by the concerned State Government where the appoint the establishment is situated. Both Central as well as State Gover~inie~it Inspectors under the provisions of this Act and make rules to implement and enforce the Act in the establishments under their respective control.
Main Provisions of the Act
Fixation of Wage Period
Every employer who is responsible for payment of wages shall fix the wage period for which wages are payable and no wage period shall exceed one month.Time for Payment of Wages. Every employer who is employing less than 1,000 employees shall make the payment of wages before the expiry of seventh day of the succeeding month. Payment of wages in eslablishments employing 1,000 or more employees shall be made on or before the tenth day of the succeeding month. All payments has to be made on a working day.
In case of termination of an employee, the wages earned by is to be paid before the expiry of the second working day from the day of which his employment was terminated.Wages to he Paid in Current Coin and Currency Notes (Section 6)All wages shall be paid in current coins or currency notes or both. The employer can pay the wages by cheque or by crediting in the bank account of the concerned employee after obtaining his written authorisation.
Deduction Permissible from the Wage
The wages of an employed person shall be paid to him without deduction of any kind except those authorised by or under this Act. Every payment by the employee to his employer will deemed to be deduction from the wages. Any loss of wages resulting from the imposition of punishment such as withholding of increment,demotion, suspension and promotion for good and sufficient reasons in accordance with the laid down rules of the establishment, shall not deemed to be deduction.
The following deductions are permissible under the Act :
- Fines
- Absence from duty
- Damages for loss of goodslmoney entrusted to the employee
- Recovery of advances or adjustment of excess payment
- Income tax
- Provident fund contribution
- Pension, if any
- ESI contribution
- Insurance premium
- Payment for co-operative society
- Deduction for any amenity or services provided by the employer
On the basis of written authorisation, deduction can also be made for any contributing scheme, Prime Minister Relief Fund, paynlent of trade union subscription etc.The total deduction from the wages of an employee during any wage period shall not exceed 75% of his wages where such deductions are only or partly made for payment to co-operative societies and in any other case, it shall not exceed 50% of his wagcs.
Fine
No fine can be imposed on the employee without issuing a show cause and without notice of the appropriate government. The maximum fine shall not exceed 3% of the wages and it has to be recovercd within 60 days of the imposition.
Obligations of the Employer
It is obligatory for the employer to fulfil the following :
(a) to fix the wage period for payment of wages to the person employed;
(b) to make the payment of wages as per the provisions of the Act within the specified time period:
(c) to inake deductions from the salary of the employees as per the provisions of the Act and not to make any unauthorised deductions;
(d) to maintain all records and register as per the provisions of the Act;
(e) to furnish the required information to the inspector as and when required and produce records and register during inspection by him; and
(f) to display prominently at conspicuous places in the establishment, the abstract of the Act in a local language and in English.
Rights of the Employees
Every employee is entitled to the followitlg rights as per the Act :
(a) -to receive wages for the wage period within the prescribed time limit in current coin and currency modes;
(b) to complaint to the inspector of wages for delayed payment or unauthorised deduction;
(c) to appeal against an order of payment of wages for delayed payment of wages authority if the amount of wages claimed withheld excceds Rs. 20;and
(d) to claim unpaid or delayed wages, unauthorised deductions and fine along with compensation.
Offences and Penalties
For any offence committed by violating any of the provisions of the Act, the employer can be imprisoned which rnay extend to six months or a fine may be imposed upto Rs. 1,000 or both.
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