Payment of Wages

Act, 1936 – Part I

Important Information

• All important provisions and dimensions which are relevant for examination will be
covered.
• Sections and sub-sections are not mentioned in the topic since they are not
relevant for the examination.
Chronology I • Objective

II • Application

III • Definitions

IV • Responsibility for Payment of Wages

V • Fixation of Wage Periods

VI • Time and Payment of Wages

VII • Mode of Payment of Wages

VIII • Rules regarding Deduction from Wages

IX • Total amount of Deduction

Objective

The Payment of of certain classes

To regulate Wages of employed
persons
Chronology I • Objective

II • Application

III • Definitions

IV • Responsibility for Payment of Wages

V • Fixation of Wage Periods

VI • Time and Payment of Wages

VII • Mode of Payment of Wages

VIII • Rules regarding Deduction from Wages

IX • Total amount of Deduction

Application
It applies to the payment of wages to persons employed in any -

Appropriate Government may, after

giving not less than 3 months notice,
Factory, railway, industrial or apply the provisions of the Act to any
other establishment establishment

This Act applies to wages

payable to an employed
person if not exceeding
rupees 24000 per month
Chronology I • Objective

II • Application

III • Definitions

IV • Responsibility for Payment of Wages

V • Fixation of Wage Periods

VI • Time and Payment of Wages

VII • Mode of Payment of Wages

VIII • Rules regarding Deduction from Wages

IX • Total amount of Deduction

Definitions

In relation to railways,
mines
Central Government

Airport transport
services, oilfields

Employee
In relation to all other
Appropriate
Employee cases State Government
Government
 Definitions
Remuneration - payable under any
award or settlement in respect of
overtime work or holidays or leave

Additional remuneration under the

Wages terms of employment or sum to which

the person is entitled under any
includes
scheme framed under any law

All remuneration Employee

Appropriate
Employee Any sum payable by reason of
expressed in terms of
Government termination of employment
money
Definitions

Any bonus not forming the part of the remuneration payable or which is not payable
under any award or settlement between the parties or order of a Court

The value of any house-accommodation, or of the supply of light, water,

medical attendance or other amenity or of any service excluded from the
Does not
Wages include
computation of wages by order of appropriate Government

Any contribution paid by the employer to any pension or provident fund, and
the interest which may have accrued thereon
Employee
Any travelling allowance or any sum paid to defray special expenses entailed on him
Appropriate
Employeeby the nature of his employment or any gratuity payable
Government
Chronology I • Objective

II • Application

III • Definitions

IV • Responsibility for Payment of Wages

V • Fixation of Wage Periods

VI • Time and Payment of Wages

VII • Mode of Payment of Wages

VIII • Rules regarding Deduction from Wages

IX • Total amount of Deduction

 Responsibility for Payment of Wages

Every EMPLOYER shall be responsible for the payment of all wages

In case of In factories – Manager of the factory

persons
employed In industrial or other establishments - a person
responsible to the employer for the supervision and
control

Upon railways – Railway administration or person

Wages
nominated
In the case of contractor – person designated by
contractor
But ultimate responsibility lies on the EMPLOYER
Chronology I • Objective

II • Application

III • Definitions

IV • Responsibility for Payment of Wages

V • Fixation of Wage Periods

VI • Time and Payment of Wages

VII • Mode of Payment of Wages

VIII • Rules regarding Deduction from Wages

IX • Total amount of Deduction

Fixation of wage-periods

Every person responsible for the

payment of wages shall fix periods in
respect of which such wages shall be
payable

No wage period shall exceed ONE

MONTH
Chronology I • Objective

II • Application

III • Definitions

IV • Responsibility for Payment of Wages

V • Fixation of Wage Periods

VI • Time and Payment of Wages

VII • Mode of Payment of Wages

VIII • Rules regarding Deduction from Wages

IX • Total amount of Deduction

Time of Payment of Wages
The wages of every person employed upon or in -
Any railway, factory or industrial or other establishment in which less than
1000 persons are employed – be paid before expiry of the 7th day,
Where death after the last day of
results from the wage-period in
injury respect of which the
Any other railway, factory, industrial or other establishment - be paid wages are payable
before expiry of the 10th day,

Where the employment of any person is terminated by the employer, the

wages - be paid before the expiry of 2nd working day from the day on
which his Wages
employment is terminated

All payments of wages shall be made on a working day

Chronology I • Objective

II • Application

III • Definitions

IV • Responsibility for Payment of Wages

V • Fixation of Wage Periods

VI • Time and Payment of Wages

VII • Mode of Payment of Wages

VIII • Rules regarding Deduction from Wages

IX • Total amount of Deduction

Mode of payment of wages

All wages shall be paid in - By crediting in

the bank A/c
By cheque or

Currency
Notes or
Current Coin Wages
or
Chronology I • Objective

II • Application

III • Definitions

IV • Responsibility for Payment of Wages

V • Fixation of Wage Periods

VI • Time and Payment of Wages

VII • Mode of Payment of Wages

VIII • Rules regarding Deduction from Wages

IX • Total amount of Deduction

Rules regarding deductions from wages

The wages of an employed person shall be paid

without deduction except authorized under this
ActWhere death
results from
injury

Every payment made by the employed person to

the employer shall be deemed to be a deduction
from wages

Wages
Any loss of wages resulting from the withholding
of increment or promotion or reduction to a lower
post or suspension shall not be deemed to be a
deduction from the wages
 Deductions from wages
Following deductions from the wages of an employed person can be made -

Where death
a) fines;
results from
b) deductions
injury for absence from duty;
c) deductions for damage to or loss of goods expressly entrusted to the employed person for
custody, or for loss of money for which he is required to account, where such damage or loss
is directly attributable to his neglect or default;
d) deductions for house-accommodation supplied by the employer
e) deductions for such amenities and services supplied by the employer as the appropriate
Government authorise; Wages
f) deductions for recovery of advances of whatever nature
g) deductions for recovery of loans made from any fund constituted for the welfare of labour
h) deductions for recovery of loans granted for house-building or other purposes
i) deductions of income-tax payable by the employed person
 Deductions from wages

j) deductions required to be made by order of a Court

k) deductions for subscriptions to any provident fund
l) deductions made with the written authorization of the employed person or the president or
Where death
secretary of the registered trade union for contribution to the National Defence Fund or to
results from
any Defence Savings Scheme
injury
m) deductions for payments to co-operative societies
n) deductions, made with the written authorisation of the person of any premium on his life
insurance policy
o) deductions made, with the written authorisation of the employed person, for payment of
the fees payable by him for the membership of any trade union
p) deductions for payment Wages
of insurance premia on Fidelity Guarantee Bonds
q) deductions, made with the written authorisation of the employed person, for contribution to
the Prime Minister’s National Relief Fund
r) deductions for contributions to any insurance scheme framed by the Central Government for
the benefit of its employees.
Chronology I • Objective

II • Application

III • Definitions

IV • Responsibility for Payment of Wages

V • Fixation of Wage Periods

VI • Time and Payment of Wages

VII • Mode of Payment of Wages

VIII • Rules regarding Deduction from Wages

IX • Total amount of Deduction

Total amount of deduction

Where such deductions are wholly or

75% of partly made for payments to co-
Where death wages operative societies
results from
Total
injury amount
of
deduction in any
wage period In any other case
from the wages
shall not exceed
Wages
50% of
wages