THE PAYMENT OF WAGES ACT
PAYMENT OF WAGES ACT 1936
[23rd April, 1936]
Whereas it is expedient to regulate the payment of wages to certain classes of [employed persons] ; it is hereby enacted as follows :-
(1) This Act may be called the Payment of Wages Act, 1936.
(2) It extends to the whole of India [* * *]
(3) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.
(4) It applies in the first instance to the payment of wages to persons employed in any [factory to persons] employed (otherwise than in a factory) upon any railway by a railway administration or either directly or through a sub-contractor, by a person fulfilling a contract with a railway administration [and to persons employed in an industrial or other establishment specified in sub-clauses (a) to (g) of clause (ii) of section 2.].
(5) The State Government may after giving three months notice of its intention of so doing, by notification in the Official Gazette, extend the provisions of this Act or any of them to the payment of wages to any class of persons employed in [any establishment or class of establishments specified by the Central Government or a State Government under sub-clause (h) of clause (ii) of section 2].
(6) Nothing in this Act shall apply to wages payable in respect of wage period which over such wage-period, average [one thousand six hundred] rupees a month or more.
This Act is applicable to the persons employed in railway administration : N.E.Rly. v.Durga Parasad, 1980 Lab.IC 390.
(i) "employed person" includes the legal representative of a deceased employed person;
(i-a) "employer" includes the legal representative of a deceased employer ;
1. Sub. by Act 38 of 1982, S.2
(e) any sum
to which the person employed is entitled under any scheme framed under
any law for the time being in force ;
(1) any bonus (whether under a scheme of profit-sharing or otherwise) which does not form part of the remuneration payable under the terms of employment or which is not payable under any award or settlement between the parties or order of a court.
(2) 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 computation of wages by general or special order of the State Government ;
(3) any contribution paid by the employer to any pension or provident fund, and the interest which may have accrued thereon ;
(4) any travelling allowance or the value of any travelling concession ;
(5) any sum paid to the employed person to defray special expenses entailed on him by the nature of his employment ; or
(6) any gratuity payable on the termination of employment in cases other than those specified in sub-clause (d).
NOTE - Clinic preparing medicinal mixtures and taking X-ray photographs: State of W.B.v. Bachu Mondal, 1977 Lab.IC 616; and Public Works Department : Executive Engineer v.K. Ramadass, (1980) 2 MLJ 487 are examples of industrial establishment. An organisation to be establishment need not be permanent : Matber Singh v.Bhola Datt, 1980 Lab. IC 383 (All.)
Every employer shall
be responsible for the payment to persons employed by him of all wages
required to be paid under this Act :
[(b) in industrial or other establishments, if there is a person responsible to the employer for the supervision and control of the industrial or other establishment ;]
(c) upon railways (otherwise
than in factories) if the employer, is the railway administration and
the railway administration has nominated a person in this behalf for the
local area concerned,
(1) Every person responsible for the payment of wages under section 3 shall fix periods (in this Act referred to a s wage period) in respect of which such wages shall be payable.
(2) No wage-period shall exceed one month.
(1) The wages of every person employed upon or in-
(a) any railway, factory or [industrial or other establishment] upon or in which less than one thousand persons are employed, shall be paid before the expiry of the seventh day.
1. Subs. by Act 38 of 1982, S.5.
THE PAYMENT OF WAGES ACT 1936
(b) any other
railway, factory or [industrial or other establishment] shall be paid
before the expiry of the tenth day,
(2) Where the employment of any person is terminated by or on behalf of the employer, the wages earned by him shall be paid before the expiry of the second working day from the day on which his employment is terminated;
(3) The State Government may be general or special order exempt to such extent and subject to such conditions, as may be specified in the order the person responsible for the payment of wages to persons employed upon any railway otherwise than in a factory) or to persons employed as daily-rated workers in the Public Works Department of the Central Government or the State Government from the operation of this section in respect of the wages of any such persons or class of such persons ;
(4) Save as otherwise provided in sub-section (2) all payments of wages shall be made on a working day.
All wages shall be
paid in current coin or currency notes or in both :
(1) Notwithstanding the provisions of sub-section(2) of section 47 of the Indian Railways Act, 1890 (9 of 1890) the wages of an employed persons hall be paid to him without deductions of any kind except those authorised by or under this Act.
Explanation I. - Every payment made by the employed person to the employer or his agent shall, for the purposes of this Act, be deemed to be a deduction from wages.
Explanation II. - Any loss of wages resulting from the imposition, for good and sufficient cause, upon a person employed, of any of the following penalties, namely :-
(i) the withholding of increment or promotion (including the shoppage of increment at an efficiency bar) ;
(ii) the reduction to a lower post or time-scale or to a lower stage in a time-scale ; or
1. Ins. by Act 29 of 1976,s.6.
THE PAYMENT OF WAGES ACT 1936
8. Fines -(1) No fine shall be imposed on any employed persons save in respect of such acts and omission on his part as the employer, with the previous approval of the State Government or of the prescribed authority may have specified by notice under sub-section (2).
(2) A notice specifying such acts and omission shall be exhibited in the prescribed nature on the premises in which the employment is carried on or in the case of persons employed upon a railway (otherwise than in a factory) at the prescribed place or places.
(3) No fine shall be imposed on any employed person until he has been given an opportunity of showing cause against the fine, or otherwise than in accordance with such procedure as may be prescribed for the imposition of fines.
(4) The total amount of fine which may be imposed in any one wage-period on any employed person shall not exceed an amount equal to three per cent of the wages payable to him in respect of that wage period.
(5) No fine imposed on any employed person who is under the age of fifteen years.
(6) No fine imposed on any employed person shall be recovered from him by instruments or after the expiry of sixty 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 by the person responsible for the payment of wages under section 3 in such form as may be prescribed ; and all such realisations shall be applied only to such purposes beneficial to the persons employed in the factory or establishment as are approved by the prescribed authority.
- When the persons employed upon or in any railway factory or [industrial
or other establishment] are part only of a staff employed under the same
management, all such realisations may be credited to a common fund maintained
for the staff as a whole :
9. Deductions for absence from duty -(1) Deductions may be made under clause (b) of sub-section (2) of section 7 only on account of the absence of an employed person from the place or places where, by the terms of his employment, he is required to work, such absence being for the whole or any part of the period during which he is so 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 a larger proportion than the period for which he was absent bears to total period, within such wage-period, during which by the terms of his employment, he was required to work ;
1. Subs. by Act 58 of 1982, S.8
Explanation - for the purpose of this section, an employed person shall be deemed to be absent from the place where he is required to work if, although present in such place, he refuse, in pursuance of a stay in-strike or for any other cause which is not reasonable in the circumstance, to carry out his work.
NOTES - Meaning of "wage-period" see Dharam Sing Rajput v. Bank of India, 1979 Lab. IC 1979 (P & H).
10. Deductions of damage or loss - (1) A deduction under clause (c) or clause (o) of sub-section (2) of section 7 shall not exceed the amount of the damage or loss cause to the employer by the neglect or default of the employed person.
(1-A) A deduction shall not be made under clause (c) or clause (m) or clause (n) or clause (o) of sub-section (2) of section 7 until the employed person has been given an opportunity of showing cause against the deduction, or otherwise than in accordance with such procedure as may be prescribed for the making of such deductions.
(2) All such deductions and all realisations thereof shall be recorded in a register to be kept by the person responsible for the payment of wages under section 3 in such form as may be prescribed.
11. Deductions for services rendered - A deduction under clause (d) or clause (e) of sub section (2) of section 7 shall not be made from the wages of an employed person unless the hose accommodation amenity or service has been accepted by him, as a term of employed or otherwise, and such deduction shall not exceed an amount equivalent to the value of the house accommodation, amenity or service supplied and, in the case of deduction under the said clause (e) shall be subject to such conditions as the State Government may impose.
(a) recovery of an advance of money given before employment began shall be made from the first payment of wage in respect of a complete wage-period, but no recovery shall be made of such advances given for travelling expenses ;
(aa) recovery of an advance of money given after employment began shall be subject to such conditions as the State Government may impose ;
(b) recovery of advances of wages not already earned shall be subjected to any rules made by the State Government remaining the extent to which such advances may be given and the installments by which they may be recovered.
12-A Deductions for recovery of loans - Deductions for recovery of loans granted under clause (fff) of sub-section (2) of section 7 shall be subject to any rules made by the State Government regulating the extent to which such loans may be granted and the rate of interest payable thereto.
13. Deductions for payment to co-operative societies and insurance schemes - Deductions under clause (j) and (k) of sub- section (2) of section 7 shall be subject to such conditions as the State Government may impose.
13-A Maintenance of registers and records - (1) Every employer shall maintain such registers and records giving such particulars of persons employed by him the work performed by them, the wages paid to them, the deductions made from their wages, the receipts given by them and such other particulars and in such form as may be prescribed.
THE PAYMENT OF WAGES ACT 1936
(2) Every register and record required to be maintained under this section shall, for the purpose of this Act, be preserved for a period of there years after the date of the last entry made therein.
14. Inspectors - (1) An Inspector of Factories appointed under sub- section(1) of section 8 of the Factories Act, 1948 (63 of 1948) shall be an Inspector for the purpose of this Act in respect of all factories within the local limits assigned to him.
(2) The State Government may appoint Inspectors for the purposes of this Act in respect of all persons employed upon a railway (otherwise than in a factory) to whom this Act applies.
(3) The State Government may, by notification in the official Gazette, appoint such other persons as it thinks fit to be Inspectors for the purpose of this Act, and may define the local limits within which and the class of factories and industrial or other establishments in respect of which they shall exercise their functions.
(4) An Inspector may -
(a) make such examination and inquiry as the thinks fit, in order to ascertain whether the provisions of this Act or rules made thereunder are being observed ;
(b) with such assistance, if any, as he thinks fit, enter, inspect and search any premises of any railway factory or [industrial or other establishment] at any reasonable time for the purpose of carrying out the objects of this Act ;
(c) supervise the payment of wages to persons employed upon any railway or any factory or [industrial or other establishment];
(d) require by a written order the production at such place, as may be prescribed, of any register or record maintained in pursuance of this Act and take on the spot of otherwise statements of any persons which he may consider necessary for carrying out the purpose of this Act.
(e) seize or take copies of such registers or documents or portions thereof as he may consider relevant in respect of an offence under this Act which he has reason to believe has been committed by an employer ;
(f) exercise such other powers as
may be prescribed ;
(4-A) The provisions of the [Code of Criminal Procedure, 1973 (2 of 1974)] shall, so far as may be, apply to any search or seizure under this sub-section as they apply to any search or seizure made under the authority of a warrant issued under [section 94] of the said Code.
(5) Every Inspector shall be deemed to be a public servant within the meaning of the Indian Penal Code, 1860 (45 of 1860).
14-A. Facilities to be afforded to Inspectors - Every employer shall afford an Inspector all reasonable facilities for making any entry, inspection, supervision, examination or inquiry under this Act.
15. Claims arising out of deductions from wages or delay in payment
of wages and penalty for malicious or vexatious claims - (1) The State
Government may, by notification in the Official Gazette, appoint a presiding
officer of any Labour Court or 1. Subs. by Act 38 of 1982, S.9
THE PAYMENT OF WAGES ACT 1936
or other person responsible for the payment of wages by the person presenting the application ; or.
(b) that in any case in which compensation is directed to be paid under sub- section(3), the applicant ought not to have been compelled to seek redress under this section, the authority may direct that a penalty not exceeding fifty rupees be paid to the State Government by the employer or other person responsible for the payment of wages.
(4-A) Where there is any dispute as to the person or persons being the legal representative or representatives of the employer or of the employed person, the decision of the authority on such dispute shall be final.
(4-B) Any inquiry under this section shall be deemed to be a judicial proceeding within the meaning of sections 193, 219 and 228 of the Indian Penal Code, 1860 (45 of 1860).
(5) Any amount directed to be paid under this section may be recovered -
(a) if the authority is a Magistrate, by the authority as if it were a fine imposed by him as Magistrate, and
(b) if the authority is not Magistrate, by any Magistrate to whom the authority makes application in this behalf, as if were a fine imposed by such Magistrate.
NOTE : - Limitation for making application : D.P.C. v. Amar Singh, 1978 ALJ 599 General Manager v.Suraj Nath Dubey, 1979 Lab IC 1427. Application for wages against Dock Labour Board is not maintainable as the Board is not the employer : Calcutta Dock Labour Board v. Payment of Wages Authority, 1982. Lab IC 657.
16. Single application in respect of claims from unpaid group - (1) Employed persons are said to belong to the same unpaid group if they are borne on the same establishment and if deductions have been made from the wages in contravention of this Act for the same cause and during the same wage-periods or if their wages for the same wages-period or periods have remained unpaid after the day fixed by section5.
(2) A single application shall be presented under section 15 on behalf or in respect of any number of employed persons belonging to the same unpaid group, and in such case every person on whose behalf such application is presented may be awarded maximum compensation to the extent specified in sub-section (3) of section 15.
(3) The authority may deal with any number of separate pending applications, presented under section 15 in respect of persons belonging to the same unpaid group as a single application presented under sub-section (2) of this section, and the provisions of that sub-section shall apply accordingly.
17. Appeals- (1) An appeal against an order dismissing either wholly or in part an application made under sub- section (2) of section 15, or against a direction made under sub- section(3) or sub- section (4) of that section may be preferred, within thirty days of the date on which the order or direction was made, in a Presidency-town before the Court of Small Causes and else where before the District Court.
(a) by the employer or other person responsible for the payment of wages under section 3, if the total sum directed to be paid by way of wages and compensation exceeds three hundred rupees or such direction has the effect of imposing on the employer or other person a financial liability exceeding one thousand rupees ; or
(b) by an employed person or any legal practitioner or any official of a registered trade union authorised in writing to act on his behalf or any Inspector under this Act, or any other permitted by the authority to make an application under sub-section (2) of section 15, if the total amount
THE PAYMENT OF WAGES ACT 1936
of wages claimed to have been without from the employed person exceeds twenty rupees or from the unpaid group to which employed person belongs or belonged exceeds fifty rupees ; or.
(c) by any person directed to pay a penalty under sub-section (4) of section 15.
(1-A) No appeal under clause (a) of sub-section (1) shall be unless the memorandum of appeal is accompanied by a certificate by the authority of the effect that the applicant has deposited the amount payable, under the direction appealed against.
(2) Save as provided in sub- section (1) any order dismissing either wholly or in part an application made under sub- section (2) of section 15, or a direction made under sub- section (3) or sub- section (4) of that section shall be final.
(3) Where an employer prefers an appeal under this section, the authority against whose section the appeal has been preferred may, and if so directed by the court referred to in sub- section (1) shall, pending the decision of the appeal, withheld payment of any sum in deposit with it.
(4) The court referred to in sub- section (1) may, if it thinks fit, submit any question or law for the decision of the High Court and, if it so does, shall decide the question in conformity with such decision.
NOTE :- If the amount as required to be deposited under sub- section (1-A) is deposited by cheque which was accepted and the certificate was issued, then even though the cheque is encashed after the period of it mitation the deposit is valid : Hajari Ram v. Mantri Khadi Mandir, AIR 1979 Raj. 76.
(1) Where at any time after an application has been made under sub- section(2) of section 15, the authority, or where at any time after an appeal has been filed under section 17 by an employed person or any legal practitioner or any official of a registered trade union authorised in writing an act on his behalf or any Inspector under this Act or any other person permitted by the authority, to make an application under sub- section (2) of section 15, the court, referred to in that section is satisfied that the employer or other person responsible for the payment of wages under section 3 is likely to evade payment of any amount that may be directed to be paid under section 15 or section 17, the authority or the Court as the case may be, except in cases where the authority or Court is of opinion that the ends of justice would be defeated by the delay, after owing the employer or other person an opportunity to being heard, may direct the attachment of so much of the property of the employer or other person responsible for the payment of wages as is, in the opinion of the authority or Court, sufficient to satisfy the amount which may be payable under the direction.
(2) The provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to attachment before judgement under the Code shall, so far as may be, apply to any order for attachment under sub-section (1).
Every authority appointed under sub-section (1) of section 15 shall have all the powers of a Civil Court under the Code of Civil Procedure, 1908 (5 of 1908), for the purpose of taking evidence and of enforcing the attendance of witnesses and compelling the production of documents, and every such authority shall be deemed to be a Civil Court for all the purposes of section 195 and of [Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).]
1. Sub. by Act 38 of 1982.S.10.
20. Penalty for offences under the Act - (1) Whether being responsible for payment of wages to an employed person contravenes any of the provisions of any of the following sections, nomely, section 5 except sub-section (4) thereof, section 7, section 8 except sub-section (8) thereof section 9, section 10 except sub-section (2) thereof, and sections 11 to 13, both inclusive, shall be punishable with fine [with shall not be less than two hundred rupees but which may extend to one thousand rupees].
(2) Whoever contravenes the provisions of section 4, sub-section (4) of section 5, section 6, sub-section (8) of section 8, sub-section (2) of section 10 or section 25 shall be punishable with fine which may extend to [five hundred rupees].
(3) Whoever being required under this Act to maintain any records or registers or to furnish any information or return-
(a) fails to maintain such register or record ; or
(b) wilfully refuses or without lawful excuse neglects to furnish such information or return ; or
(c) wilfully furnishes or cause to be furnished any information or return which he knows to be false ; or
(d) refuses to answer or wilfully gives
false answer to any question necessary for obtaining any information required
to be furnished under this Act;
(4) Whoever -
(a) wilfully obstructs an Inspector in the discharge of his duties under this Act ; or
(b) refuses or wilfully neglects to afford an Inspector any reasonable facility for making any entry, inspection, examination, supervision or inquiry authorised by or under this Act in relation to any railway, factory or [industrial or other establishment] ; or
(c) wilfully refuses to produce on the demand of an Inspector any register or other document kept in pursuance of this Act ; or
(d) prevents or attempts to prevent or does
anything which he has any reason to believe is likely to prevent any person
from appearing before or being examined by an Inspector acting in pursuance
of his duties under this Act ;
If any person who has been convicted of any offence punishable under this
Act is again guilty of an offence involving contravention of the same
provision, he shall be punishable on a subsequent conviction with imprisonment
for a term [which shall not be less than one month but which may extend
to six months and with fine which shall not be less than five hundred
rupees but which may extend to three thousand rupees] or with both.
(6) If any person fails or wilfully neglect to pay the wages of any employed person by the date fixed by the authority in this behalf he shall, without
1. Sub. by Act 38 of 1982.S.11
THE PAYMENT OF WAGES ACT 1936
prejudice to any other action that may be taken against him, be punishable with an additional fine which may extend to [one hundred rupees] for each day for which such failure or neglect continues.
21. Procedure in trial of offence - (1) No Court shall take cognizance of a complaint against any person for an offence under sub-section (1) of section 20, unless an application in respect of the facts constituting the offence has been presented under section 15 and has been granted wholly or in part and the authority empowered under the latter section or the appellate court granting such application has sanctioned the making of the complaint.
(2) Before sanctioning the making of a complaint against any person for an offence under sub-section (1) of section 20, the authority empowered under section 15 or the appellate Court, as the case may be, shall give such person an opportunity of showing cause against the granting of such sanction, and the sanction shall not be granted if such person satisfies the authority or Court that this default was due to -
(a) a bona fide error or bona fide dispute as to the amount payable to the employer person, or
(b) the occurrence of an emergency, or the existence of exceptional circumstances, such that the person responsible for the payment of the wages was unable, though exercising reasonable diligence, to make prompt payment, or
(c) the failure of the employed person to apply for or accept payment.
(3) No Court shall take cognizance of a contravention of section 4 or of section 6 or of a contravention of any rule made under section 26 except on a complaint made by or with the sanction of an Inspector under this Act.
(3-A) No Court shall take cognizance of any offence punishable under sub-section (3) or sub-section (4) of section 20 except on a complaint made by or with the sanction of an Inspector under this Act.
(4) In imposing any fine for an offence under sub-section (1) of section 20 the Court shall take into consideration the amount of any compensation already awarded against the accused in any proceeding taken under section 15.
(a) forms the subject of an application under section 15 which has been presented by the plaintiff and which is pending before the authority appointed under that section or of an appeal under section 17 ; or
(b) has formed the subject of a direction under section 15 in favour of the plaintiff ; or
(c) has been adjusted, in any proceeding under section 15 not to be owed to the plaintiff ; or
(d) could have been recovered by an application under section 15.
NOTES - Jurisdiction of Civil Court to entertain suit for recovery of arrears of pay, etc., is nit barred while application for such relief is pending : M.S.R.T Corp. v. Ramji Hari Lal, AIR 1977 Bom.1 : 1977 Lab.IC 23.
22-A. Protection of action taken in good faith - No suit, prosecution or other legal proceeding shall lie against the Government or any officer of the Government for anything which is in good faith done or intended to be done under this Act.
1. Sub. by Act 38 of 1982, S. 11.
THE PAYMENT OF WAGES ACT 1936
23. Contracting out - Any contract or agreement, whether made before or after the commencement of this Act, whereby an employed person relinquished any right entered by this Act shall be null and void in so far as it purports to deprive him of such right.
24. Application of Act to railways, air transport services mines and oil-fields - The powers by this Act conferred upon the State Government shall in relation to railways, air transport services, mines and oilfields, be powers of the Central Government.
25. Display by notice of abstracts of the Act - The person responsible for the payment of wages to person [employed in a factory or an industrial or other establishment] shall cause to be [displayed in such factory or industrial or other establishment] a notice containing such abstracts of this Act and of the rules made thereunder in English and in the language of the majority of the persons employed [in factory or industrial or other establishment] as may be prescribed.
25.A. Payment of undisbursed wages, in cases of death of employed person-(1) Subject the other provisions of the Act, all amounts payable to an employed person as wages shall, if such amounts could not or cannot be paid on account of his death before the payment or on account of his where-abouts not being known
(a) be paid to the person nominated by him in this behalf in accordance with the rules made under this Act ; or
(b) where no such nomination has been made or where for any reasons such amounts cannot be paid to the person so nominated, be deposited with the prescribed authority who shall deal with the amounts so deposited in such manner as may be prescribed.
(2) Where in accordance with the provisions of sub-section (1), all amounts payable to an employed person as wages -
(a) are paid by the employer to the person nominated by the employed person ; or
(b) are deposited by the employer with the prescribed authority, the employer shall be discharged of his liability to pay those wages.
(2) The State Government may, by notification in the Official Gazette, make rules for the purposes of carrying into effect the provisions of this Act.
(3) In particular and without prejudice to the generality of the foregoing power, rules made under sub-section (2), may -
(a) require the maintenance of such records, registers, returns and notices as are necessary for the enforcement of the Act, and prescribed the form thereof ; and the particulars to be entered in such registers or records ;
(b) require the display in a conspicuous place on premises where employment is carried on of notices specifying rtes of wages payable to person employed on such premises ;
(c) provided for the regular inspection of the weights, measures and weighting machines used by employers in checking or ascertaining the wages of persons employed by them ;
1. Subs. by Act 38 of 1982, 12.
2. S. 25-A, ins. by ibid. S. 13.