Payments of Wage Act

The Payment of Wages Act 1936 is the act which was launched as a solution against illegal deductions in the wages and delay in the salaries of workers. The Act synchronizes the payment of salaries of specific classes of individuals employed in the industry. It ensures salaries on time without unauthorized deductions. An employee who has a salary of INR 24,000/- per month is not eligible for the Payment of Wages Act.

Few provisions under the Act:

Regular Pay/Payment on time: Salaries must be credited before the 7th day of a month where the number of workers is less than 1000 and 10th day otherwise. The wage period shall not exceed 1 month. The Act applies only to employees drawing wages not exceeding INR 6500 a month.

Deduction from Wages: An employer is allowed to deduct only authorized deductions such as fines, absence from work, damage or loss of property, recovery of loans, insurance.

Payment Mode: As per the Act, salaries are to be paid in currency notes or coins, direct credit is permitted if an employee agrees.