CHAPTER 3: PAYMENT OF WAGES
15. Mode of payment of wages.
All wages shall be paid in current coin or currency notes or by cheque or by crediting the wages in the bank account of the employee or by the electronic mode:
The notified establishment shall pay by cheque or bank credit.
16. Fixation of wage period.
The employer shall fix the wage period for employees.
Either as daily/weekly/fortnightly / monthly
No wage period in respect of any employee shall be more than a month:
Different wage periods may be fixed for different establishments.
17. Time limit for payment of wages.
(1)The employer shall pay or cause to be paid wages of
(i) daily basis, at the end of the shift;
(ii) weekly basis, on the last working day of the week ie before the weekly holiday;
(iii) fortnightly basis, before the end of the 2nd day after the end of the fortnight;
(iv) monthly basis, before the expiry of the 7th day of succeeding month.
(2) Where an employee has been—
(i) removed or dismissed from service; or
(ii) retrenched or has resigned from service, or became unemployed due to closure of the establishment,
the wages payable to him shall be paid within 2 working days of his removal, dismissal, retrenchment or, as the case may be, his resignation.
(3) Govt have the power to notify other time limits
(4) Time limit provided in other acts shall remain valid over and above this law.
18. Deductions which may be made from wages.
(1) No deductions can be made under any law, except those as are authorised under this Code.
Explanation.––For the purposes of this sub-section,—
(a) any payment made by an employee to the employer or his agent shall be deemed to be a deduction from his wages;
(b) any loss of wages to an employee, for a good and sufficient cause, resulting from—
(i) the withholding of increment or promotion, including the stoppage of an increment; or
(ii) the reduction to a lower post or time-scale; or
(iii) the suspension,
shall not be deemed to be a deduction from wages in a case where the provisions made by the employer for such purposes are satisfying the requirements specified in the notification issued by the appropriate Government in this behalf.
(2) Deductions from the wages of an employee shall be made in accordance with the provisions of this Code, and may be made only for the following purposes, namely:—
(a) fines imposed on him;
(b) deductions for his absence from duty;
(c) deductions for damage to or loss of goods expressly entrusted to the employee 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 or by appropriate government or any housing board set up under any law for the time being in force
(e) deductions for such amenities and services supplied by the employer. The value shall be determined by appropriate govt
Explanation.––For the purposes of this clause, the expression "services" does not include the supply of tools and raw materials required for the purposes of employment;
(f) deductions for recovery of—
(i) advances, interest etc
(ii) loans made with interest etc
(g) Housing loan with interest
(h) deductions of income-tax or any other statutory levy
(i) deductions for advances from any social security fund or scheme constituted by law including provident fund or pension fund or health insurance scheme or fund known by any other name;
(j) deductions for payment of co-operative society
(k) with the written authorisation of the employee, for payment of the fees payable by him for the membership of any Trade Union registered under the Trade Unions Act, 1926;
(l) deductions for recovery of losses sustained by the railway administration on account of acceptance by the employee of counterfeit or base coins or mutilated or forged currency notes;
(m) deductions for recovery of losses sustained by the railway administration on account of the failure of the employee to invoice, to the bill, to collect or to account for the appropriate charges due to the railway administration whether in respect of fares, freight, demurrage, wharfage and cranage or in respect of the sale of food in catering establishments or in respect of commodities in grain shops or otherwise;
(n) deductions for recovery of losses sustained by the railway administration on account of any rebates or refunds incorrectly granted by the employee where such loss is directly attributable to his neglect or default;
(o) deductions, made with the written authorisation of the employee, for contribution to the PMNRF or to such other fund as the Central Government may, by notification, specify.
(3) In any case deductions can not exceed 50% of such wages.
(4) If it exceeds 50%, deductions will be made as per the system mentioned in rules
(5) If the deduction is made, and not deposited to the government, the employee shall not be responsible
19. Fines.
(1) No fine shall be imposed except that may have specified by notice.
(2) A notice specifying such acts and omissions shall be exhibited on the premises in which the employment is carried on as per rules.
(3) No fine shall be imposed on any employee until such employee has been given an opportunity of showing cause against the fine or otherwise
(4) The total amount of fine which may be imposed shall not exceed an amount equal to 3% of the wages payable to him in respect of that wage-period.
(5) No fine shall be imposed on any employee who is under the age of 15 years.
(6) No fine imposed on any employee shall be recovered from him by instalments or after the expiry of ninety days from the day on which it was imposed.
(7) Every fine shall be deemed to have been imposed on the day of the act or omission in respect of which it was imposed.
(8) All fines and all realisations thereof shall be recorded in a register to be kept in such manner and form as may be prescribed, and all such realisations shall be applied only to such purposes beneficial to the persons
20. Deductions for absence from duty
(1) Deductions may be made under sec 18(2)(b) only on account of the absence of an employee from the place or places where the employee is required to the terms of his employment, he is required to work,
(2) The amount of such deduction shall in no case bear to the wages payable to the employed person in respect of the wage-period for which the deduction is made in a larger proportion than the period for which he was absent bears to the total period within such wage-period during which by the terms of his employment he was required to work:
Provided that, subject to any rules made in this behalf by the appropriate Government if ten or more employed persons acting in concert absent themselves without due notice (that is to say without giving the notice which is required under the terms of their contracts of employment) and without reasonable cause, such deduction from any such person may include such amount not exceeding his wages for eight days as may by any such terms be due to the employer in lieu of due notice.
Explanation.––For the purposes of this section, an employee shall be deemed to be absent from the place where he is required to work if, although present in such place, he refuses, in pursuance of a stay-in strike or for any other cause which is not reasonable in the circumstances, to carry out his work.
21. Deductions for damage or loss.
(1) A deduction under clause (c) or clause (n) of sec 18(2) for damage or loss shall not exceed the amount of the damage or loss caused to the employer by negligence or default of the employee.
(2) A deduction shall not be made under sub-section (1) until the employee has been given an opportunity of showing cause against the deduction
(3) All such deductions and all realisations thereof shall be recorded in a register to be kept in such form as may be prescribed.
22.Deductions for services rendered.
A deduction under clause (d) or clause (e) of sub-section (2) of section 18 shall not be made from the wages of an employee, unless the house-accommodation amenity or service has been accepted by him as a term of employment or otherwise and such deduction shall not exceed an amount equivalent to the value of the house-accommodation amenity or service supplied and shall be subject to such conditions as the appropriate Government may impose.
23. Deductions for recovery of advances.
Deductions under clause (f) of sub-section (2) of section 18 for recovery of advances given to an employee shall be subject to the following conditions, namely:––
(a) recovery of the advance of money given to an employee before the employment began shall be made from the first payment of wages to him in respect of a complete wage-period but no recovery shall be made of such advances given for travelling expenses;
(b) recovery of the advance of money given to an employee after the employment began shall be subject to such conditions as may be prescribed;
(c) recovery of advances of wages to an employee not already earned shall be subject to such conditions as may be prescribed.
24. Deductions for recovery of loans.
Deductions under clause 18(2)(g) for recovery of loans granted to an employee, regulating the extent to which such loans may be granted and the rate of interest payable thereon, shall be such as may be prescribed.
25. Chapter not to apply to Government establishments.
The provisions of this Chapter shall not apply to the Government establishments unless the appropriate Government, by notification, applies such provisions to the Government establishments specified in the said notification.
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