Payment of Wages Act- India
The main objective of the Payment of Wages Act, 1936 is to ensure that unnecessary delay in the payment of wages is not caused by the employers and to prevent unauthorized deductions from the wages. The State Government may by notification extend the provisions to any class of persons employed in any establishment or class of establishment. The benefit of the Act prescribes for the regular and timely payment of wages (on or before 7th day or 10th day of after wage period is greater than 1000 workers).
- Time of payment of wages
According to Section 5 of the Indian Payment of Wages Act, 1936, the wages of every person employed are to be paid:
- when less than 1000 persons are employed, 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.
- Permitted Deduction from wages
The following deductions are permissible under the Act:
- 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, PF contributions, cooperative societies, premium for Life Insurance, contribution to any fund constituted by employer or a trade union, recovery of losses, ESI contributions, etc.
- For default or negligence of an employee resulting into loss for the employer after serving a show cause notice has to the employee.
- Unauthorized absence for whole or any part of the day – If ten or more persons absent without reasonable cause.
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