Payment of Wages Act, 1936
The Payment of Wages Act, 1936 regulates the payment of wages of certain classes of employed persons.
- It extends to the whole of India and it came into force on 28th March 1937.
1) This act applies to an employed person whose wage does not exceed twenty-four thousand rupees per month.
2) Industrial or other establishment includes the following:
- Tramway or motor transport service engaged in carrying passengers or goods or both for hire or reward.
- Air transport service other than such service which is exclusively employed in the military, naval or air forces or the civil aviation department.
- Dock, wharf, or jetty.
- Inland vessel, mechanically propelled.
- Mine, quarry, or oilfield.
- Any workshop or establishment is included if it involves the production, adaption, or manufacturing of articles for use, transport, or sale.
- Any establishment in which work relating to the construction, development, or maintenance of buildings, roads, bridges or canals, navigation, irrigation, or distribution of electricity or any other form of power is being carried on.
- Any other establishment notified by the appropriate government.
3) A wage-period shall not exceed one month.
4) Wages shall be paid before the expiry of the seventh day and tenth day if the person is employed in an establishment in which less than one thousand persons and more than one thousand are employed respectively.
- If a person is employed on a dock, wharf or jetty or in a mine, the balance of wages shall be paid before the expiry of the seventh day from the day of such completion.
- If the employment of any person is terminated by the employer, the wages shall be paid before the expiry of the second working day.
- If the employment of any person is terminated due to the closure of the establishment, the wages shall be paid before the expiry of the second day.
5) The total amount of deductions from the wages of an employed person shall not exceed:
- seventy-five percent, if the deductions include payments to co-operative societies.
- fifty percent, in any other case.
6) The total amount of fine imposed in a wage-period on any employed person shall not exceed an amount equal to three percent of the wages.
7) A fine shall not be imposed on any employed person who is under the age of fifteen years.
8) The appropriate government may appoint the following as the authority to hear and decide the claims related to the deductions or delay in wages:
- Any commissioner for Workmen's Compensation or
- Regional Labour Commissioner (central) or
- Assistant Labour Commissioner (central) with at least two years’ experience or
- Assistant Labour Commissioner (state) with at least two years’ experience or
- A presiding officer of any Labour Court or Industrial Tribunal constituted under the Industrial Disputes Act, 1947 or under any corresponding law or
- Judge of a Civil Court or a Judicial Magistrate.
9) The authority may direct the employer:
- To refund the deducted amount together with the compensation not exceeding ten times the amount deducted.
- To pay the delayed wages together with the compensation not exceeding three thousand rupees but not less than one thousand five hundred rupees.
- The authority may direct the employer to pay the maximum compensation of two thousand rupees, even if the amount deducted or delayed wages are paid before the disposal of the application.
10) If the authority is satisfied that the application is either malicious or vexatious, it may direct the person who presented the application to pay a penalty not exceeding three hundred seventy-five rupees to the employer.
11) If a person who is required to nominate or designate a person under section 3 (responsibility for payment of wages) fails to do so, such person shall be punishable with a maximum fine of three thousand rupees.
12) If a person who is required to maintain records or registers or to furnish any information or return, does the following, then he shall be punishable with fine which shall not be less than one thousand five hundred rupees but may extend to seven thousand five hundred rupees:
- Fails to maintain such a register or record.
- Wilfully refuses to furnish such information or furnishes false information or return or refuses to answer some information that is required to be furnished under this act.
13) If a person wilfully obstructs an inspector or refuses to produce any register or document demanded by the inspector or refuses to afford an inspector any reasonable facility for making the inspection shall be punishable with a fine which shall not be less than one thousand five hundred rupees but may extend to seven thousand five hundred rupees.
14) If any person is convicted again of an offence involving contravention of the same provision, then he shall be punishable with imprisonment for a term or with fine which shall not be less than three thousand seven hundred fifty rupees but may extend to twenty-two thousand five hundred rupees.
15) If any person fails or wilfully neglects to pay the wages by the date fixed by the authority, he shall be punishable with an additional fine which may extend to seven hundred fifty rupees for each day for which such neglect continues.
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