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PAYMENT OF WAGES ACT

Ministry of Law and Justice

Act nº 4 of 1936


  • Act nº 4 of 1936

Preamble

THE PAYMENT OF WAGES ACT, 1936

[Act, No. 4 of 1936]1

[23rd April,1936]

PREAMBLE

An Act to regulate the payment of wages of certain classes of 2 [employed persons].

whereas it is expedient to regulate the payment of wages to certain classes of 2 [employed persons].

It is hereby enacted as follows:-

1. For Statement of Objects and Reasons see Gazette of India, Pt. V, p. 20 and for Report of the Select Committee see Gazette of India, Pt. V, p. 77. The Act has been extended to Goa, Daman and Diu by Reg. 12 of 1962, section 3 and Schedule; to Dadra and Nagar Haveli by Reg. 6 of 1963, section 2 and Schedule I; to Pondicherry by Reg. 7 of 1963, section 3 and Schedule I and to Lakshadweep Islands by Reg. 8 of 1965, section 3 and Schedule.

2. Substituted by Act 38 of 1982, section 2 for "persons employed in industry" (w.e.f. 15-10-1982).


Section 1. Short title, extent, commencement and application

(1) This Act may be calledthe Payment of Wages Act, 1936.

1 [(2)It extendsto the whole of India 2 [***]].

(3) It shall come into force on such date3 as the Central Government may by notificationin the Official Gazette, appoint.

(4) It applies in thefirst instance to the payment of wages to persons employed inany 4 [factory,to persons] employed (otherwise than in a factory) upon any railway by a railwayadministration or, either directly or through a sub-contractor, by a person fulfillinga contract with a railway administration, 5 [andto persons employed in an industrial or other establishment specified insub-clauses (a) to (g) of clause (ii) of section2].

(5) The [stateGovernment] may, after giving three months' notice of its intention ofso doing, by notification in the Official Gazette, extend the provisions of 6 [thisAct] or any of them to the payment of wages to any class of personsemployed in 7 [any establishmentor class of establishments specified by 8 [appropriategovernment] under sub-clause (h) of clause (ii) of section 2]:

9 [Providedthat in relation to any such establishment owned by the Central Governmentno such notification shall be issued except with the concurrence of that Government.]

10 (6) This Act applies to wages payable to an employed person in respect of awage period if such wages for that wage period do not exceed six thousand fivehundred rupees per month or such otherhigher sum which, on the basis of figures of the Consumer Expenditure Surveypublished by the National Sample Survey Organisation, the Central Governmentmay, after every five years, by notification in the Official Gazette,specify.".

1. Substituted by the Adaptation of Laws Order, 1950, for sub-section (2).

2. The words "except the State of Jammu and Kashmir" Substituted by Act3 of 1951, section 3 and Schedule for thewords "except Part BStates" which were subsequently omitted by Act 51 of1970, section 2 and Schedule

3. Came into force on 28-3-1937, see Gazette of India, 1937, Pt. I, pg.626.

4. Substituted by Act 38 of 1982, section 3, for "factory and to persons"w.e.f. 15-10-1982.

5. Inserted by Act 38 of 1982, section 3w.e.f. 15-10-1982.

6. Substituted by Act 68 of 1957, section 2, for "the Act"w.e.f. 1-4-1958.

7. Substituted by Act 38 of 1982, section 3, for "any industrialestablishment or in any class or group of industrial establishments" w.e.f.15-10-1982.

8.Substitutedvide Payment of Wages (Amendment) Act, 2005. Previous text was "the centralGovernment or a state Government"

9. Substitutedby Act 38 of 1982, section 3, for proviso w.e.f. 15-10-1982.

10.Substitutedvide Payment of Wages (Amendment) Act, 2005. Previous text was Nothing in this Act shallapply to wages payable in respect of a wage-period, oversuchwage-period,average [onethousand six hundred rupees] a month or more.


Section 2. Definitions

In this Act, unless there is anything repugnant in the subject or context,---

1 (i) "appropriate Government" means, in relation to railways, air transport services, mines and oilfields, the Central Government and, in relation to all other cases, the State Government;';

2 [(ia) "employed person" includes the legal representative of a deceased person;

(ib)"employer" includes the legal representative of a deceased employer;

(ic) "factory" means a factory as defined in clause (m) of section 2 of the Factories Act, 1948 (63 of 1948) and includes any place to which the provisions of that Act have been applied under sub-section (1) of section 85 thereof;]

(ii) 3 ["industrial or other establishment" means] any--

4 [(a) tramway service, or motor transport service engaged in carrying passenger or goods or both by road for hire or reward;

(aa) air transport service other than such service belonging to, or exclusively employed in the military, naval or airforces of the Union or the Civil Aviation Department of the Government of India;]

(b) dock, wharf or jetty;

5 [(c) inland vessel, mechanically propelled;]

(d) mine, quarry or oil-field;

(e) plantation;

(f) workshop or other establishment in which articles are produced, adapted or manufactured, with a view to their use, transport or sale;

6 [(g) establishment in which any work relating to the construction, development or maintenance of buildings, roads, bridges or canals, or relatingto operationconnected with navigation,irrigation, development or maintenance of buildings, roads, bridges or mission and distribution of electricity or any other form of power is being carried on;]

7 [(h) any other establishment or class of establishment which [the appropriate Government] may, having regard to the nature thereof, the need for protection of persons employed therein and other relevant circumstances, specify, by notification in the Official Gazette;]

8 [(iia) "mine" has the meaning assigned to it in clause (j) of sub-section (1) of section 2 of the Mines Act, 1952 (35 of 1952);]

9 [(iii) "plantation" has the meaning assigned to it in clause (f) of section 2 of the Plantations Labour Act, 1951 (69 of 1951);]

(iv) "prescribed" means prescribed by rules made under this Act;

10 '(v) "railway administration" has the meaning assigned to it in clause (32) of section 2 of the Railways Act, 1989(24 of 1989);.

11 [(vi) "wages" means all remuneration (whether by way of salary, allowances, or otherwise) expressed in terms of money or capable of being so expressed which would, if the terms of employment, express or implied, were ful­filled, be payable to a person employed in respect of his employment or of work done in such employment, and includes-

(a) any remuneration payable under any award or settlement between the parties or order of a Court;

(b) any remuneration to which the person employed is entitled in respect of overtime work or holidays or any leave period;

(c) any additional remuneration payable under the terms of employment (whether called a bonus or by any other name);

(d) any sum which by reason of the termination of employment of the person employed is payable under any law, contract or instrument which provides for the payment of such sum, whether with or without deductions, but does not provide for the time within which the payment is to be made;

(e) any sum to which the person employed is entitled under any scheme framed under any law for the time being in force,

but does not include-

(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 a 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).]

1. Inserted vide Payment of Wages (Amendment) Act, 2005. Also previous clauses (i), (ia) and (ib) renumbered as (i), (ia) (ib) and (ic)

2. Substituted by Act 53 of 1964, section 3, for clause (i) w.e.f. 1-2-1965.

3. Substituted by Act 38 of 1982, section 4, for ' "industrial establishment" means' w.e.f. 15-10-1982.

4. Substituted by Act 53 of 1964, section 3, for sub-clause (a) w.e.f. 1-2-1965.

5. Substituted by Act 68 of 1957, section 3, for sub-clause (c) w.e.f. 1-4-1958.

6. Inserted by Act 68 of 1957, section 3 w.e.f. 1-4-1958.

7. Inserted by Act 38 of 1982, section 4 w.e.f. 15-10-1982.

8. Inserted by Act 53 of 1964, section 3 w.e.f. 1-2-1965.

9. Substituted by Act 53 of 1964, section 3, for clause (iii) w.e.f. 1-2-1965.

10. Substituted vide Payment of Wages (Amendment) Act, 2005. Previous text was (v) "railway administration" has the meaning assigned to it in clause (6) of section 3 of the Indian Railways Act, 1890 (9 of 1890); and]

11. Substituted by Act 68 of 1957, section 3, for clause (vi) w.e.f. 1-4-1958.


Section 3. Responsibility for payment of wages

1 [3. Responsibility for payment of wages

(1) Every employer shall beresponsible for the payment of all wages required to be paid under this Act topersons employed by him and in case of persons employed,--

(a) in factories, if a person hasbeen named as the manager of the factory under clause (f) of sub-section (1)of section 7 of the Factories Act, 1948;

(b) in industrial or other establishments, if there is a personresponsible to the employer for the supervision and control of the industrial orother establishments;

(c) upon railways (other than infactories), if the employer is the railway administration and the railwayadministration has nominated a person in this behalf for the local areaconcerned;

(d) in the case of contractor, a person designated by suchcontractor who is directly under his charge; and

(e) in any other case, a person designated by the employer as aperson responsible for complying with the provisions of the Act,

the person so named, the personresponsible to the employer, the person so nominated or the person sodesignated, as the case may be, shall be responsible for such payment.".

(2) Notwithstandinganything contained in sub-section (1), it shall be the responsibility of theemployer to make payment of all wages required to be made under this Act in casethe contractor or the person designated by the employer fails to make suchpayment."

1. Substituted vide Payment ofWages (Amendment) Act, 2005. Previous text was "Every employer shall beresponsible for the payment to personsemployed by him of all wages required to be paid under this Act:Provided that, in the case of persons employed (otherwise than by acontractor)--(a)in factories, if a person has been named as the manager of the factory under * [clause(f) of sub-section (1) of section 7 of the Factories Act, 1948 (63of 1948)]; **[(b) in industrial or other establishments, if there is aperson responsible to the employer for the supervision and control of industrialor other establishments;] (c) upon railways (otherwise than in factories), ifthe employer is the railway administration and the railway administration hasnominated a person in this behalf for the local area concerned, the person sonamed, the person responsible to the employer, or the person so nominated, asthe case may be ***[shall also be responsible] for such payment.]

* Substituted by Act 68 of 1957, section 4, for"clause (e) of sub-section (1) of section 9 of the Factories Act, 1934 (25 of1934)" w.e.f. 1-4-1958.

** Substituted by Act 38 of 1982,section 5, for clause (b) w.e.f. 15-10-1982.

*** Substituted by Act 53 of 1964,section 4, for "shall be responsible" w.e.f. 1-2-1965.


Section 4. Fixation of wage-periods

(1) Every person responsible for the payment of wages under section 3 shall fix periods (in this Act referred to as wage-periods) in respect of which such wages shall be payable.

(2) No wage-period shall exceed one month.

Section 5. Time of payment of wages

(1) The wages of every person employed upon or in--

(a) any railway, factory or 1 [industrial or other establishment] upon or in which less than one thousand persons are employed, shall be paid before expiry of the seventh day,

(b) any other railway, factory or 1 [industrial or other establishment] shall be paid before the expiry of the tenth day,

after the last day of the wage-period in respect of which the wages are payable:

2 [Provided that in the case of persons employed on a dock, wharf or jetty or in a mine, the balance of wages found due on completion of the final tonnage account of the ship or wagons loaded or unloaded, as the case may be, shall be paid before the expiry of the seventh day from the day of such completion.]

(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:

2 [Provided that where the employment of any person in an establishment is terminated due to the closure of the establishment for any reason other than a weekly or other recognised holiday, the wages earned by him shall be paid before the expiry of the second day from the day on which his employment is so terminated.]

(3) The 3 [state Government] may, by 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) 4 [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 on any such persons or class of such persons:

4 [Provided that in the case of persons employed as daily-rated workers as aforesaid, no such order shall be made except in consultation with the Central Government.]

(4) 5 [Save as otherwise provided in sub-section (2), all payments] of wages shall be made on a working day.

STATE AMENDMENTS

6 Andaman and Nicobar Islands

In section 5, for sub-section (1), the following sub-section shall be substituted, namely:--

"(1) The wages of every person employed upon or in any railway, factory or industrial establishment shall be paid before the expiry of such number of days after the last day of the wage-period in respect of which the wages are payable as the State Government may be general or special order, specify and different number of days may be specified for different areas; so, however, that the number of days so specified shall not exceed the wage-period next following the wage-period in respect of which the wages are payable."

7 Lakshadweep

In section 5, for sub-section (1), substitute the following, namely:--

"(1) The wages of every person employed in any factory or industrial establishment shall be paid before the expiry of such number of days, after the last day of the wage-period in respect of which the wages are payable, as the State Government may, by general or special order, specify, and different number of days may be specified for different areas, so, however, that the number of days so specified shall not exceed the wage-period next following the wage-period in respect of which the wages are payable."

1. Substituted by Act 38 of 1982, section 6, for "industrial establishment" (w.e.f. 15-10-1982).

2. Added by Act 53 of 1964, section 5 (w.e.f. 1-2-1965).

3. Substituted by the A.O. 1137, for Governor-General in Council"

4. Inserted by Act 53 of 1964, section 5 (w.e.f. 1-2-1965).

5. Substituted by Act 53 of 1964, section 5, for "All payments" (w.e.f. 1-2-1965).

6. Vide Regulation 5 of 1965, section 2 (w.e.f. 8-7-1965).

7. Vide Regulation 2 of 1974, section 2 (w.e.f. 8-4-1974).


Section 6. Wages to be paid in current coin or currency notes

All wages shall be paid in current coins or currency notes or in both:

1[ Provided that the employer may, after obtaining the written authorisation of the employed person, pay him the wages either by cheque or by crediting the wages in his bank account.]

STATE AMENDMENTS

2Andhra Pradesh

In section 6, after the existing proviso add further proviso namely:--

"Provided further that the State Government may, by notification in the Andhra Pradesh Gazette, specify the industrial establishments, the employers of which shall pay to the persons employed therein, the wages either by cheque or by crediting the wages in their bank account"--

3Assam

In section 6, add the following proviso and Explanation--

"Provided that notwithstanding anything contained in the Payment of Bonus Act, 1965, one-third of the amount of bonus payable to an employed person in a particular year in excess of rupees forty may be paid or invested into the National Defence Certificates or National Savings Certificates (First Issue), if the employed person records his assent by furnishing a no-objection certificate in the manner to be prescribed, to his employer.

Explanation--For the purposes of this section, the expression (1) 'wages' shall include any bonus of the description given in sub-clause (1) of clause (vi) of section 2; and (2) 'bonus' mean bonus payable to an employed person under the terms of employment or under an award or settlement or order of a Court, and also includes any bonus of the description given in sub-clause (1) of clause (vi) of section 2."

4Bihar

In section 6, the following proviso shall be added, namely:--

"Provided that where the amount of entire bonus payable during a year to an employed person under the terms of employment or under any award or settlement or orders of a Court exceeds an amount equal to one-forth of his earnings (exclusive of dearness allowance) for that year such excess shall be paid to him or invested on his behalf in the manner prescribed."

5Gujarat

Same as that of Maharashtra.

6Maharashtra

For section 6, the following shall be substituted--

"6. Wages to be paid in current coins or currency notes.--All wages shall be paid in current coins or currency notes, or in both:

Provided that, where the amount of any bonus payable to an employed person exceeds an amount equal to one-forth of his earnings (exclusive of dearness allowance) for the year to which the bonus relates, such excess shall be paid or invested in the manner prescribed."

Explanation.--For the purpose of this section, the expression--

(1) 'wages' shall include any bonus of the description given in sub-clause (1) of clause (iv) of section 2, and

( 2) 'bonus' means any bonus payable to an employed person under the terms of employment or under an award or settlement or order of a Court and also includes any bonus of the description given in sub-clause (1) of clause (vi) of section 2."

7Orissa

In section 6, the following proviso shall be added, namely:--

"Provided that when the amount of bonus payable to an employed person exceeds an amount equal to one-fourth of his earnings (exclusive of dearness allowance) for the year to which the bonus relates, such excess shall be paid or invested in the manner prescribed."

1. Inserted by Act 29 of 1976, section 3 (w.e.f. 12-11-1975).

2. Vide Andhra Pradesh Act 15 of 1982, section 2 (w.e.f. 7-10-1982).

3. Vide Assam Act 1 of 1970, section 2.

4. Vide Bihar Act 4 of 1961, section 2 (w.e.f. 9-3-1961) as amended by Bihar Act 4 of 1963, section 2.

5. Vide Gujarat Act 26 of 1961, section 3 (w.e.f. 12-6-1961).

6. Vide Maharashtra Act 13 of 1961, section 4 (w.e.f. 4-3-1961).

7. Vide Orissa Act 4 of 1961, section 2 (w.e.f. 11-2-1961).


Section 7. Deductions which may be made from wages

(1) Notwithstanding the provisions of 1 [the Railways Act, 1989], the wages of an employed person shall be paid to him without deductions of any kind except those authorised by or under this Act.

2 [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.

3 [ExplanationII.-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 stoppage 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

(iii) suspension,

shall not be deemed to be a deduction from wages in any case where the rules framed by the employer for the imposition of any such penalty are in conformity with the requirements, if any, which may be specified in this behalf by the [state Government] by notification in the Official Gazette.]

(2) Deductions from the wages of an employed person shall be made only in accordance with the provisions of this Act, and may be of the following kinds only, namely:---

(a) fines;

(b) deductions 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;

4 [(d) deductions for house-accommodation supplied by the employer or by Government or any housing board set up under any law for the time being in force (whether the Government or the board is the employer or not) or any other authority engaged in the business of subsidising house-accommodation which may be specified in this behalf by the [state Government] by notification in the Official Gazette;]

[(e) deductions for such amenities and services supplied by the employer as the 5 [***] [state Government] 6 [or any officer specified by it in this behalf] may, by general or special order, authorise;]

Explanation-The word "services" in 7 [this clause] does not include the supply of tools and raw materials required for the purposes of employment;]

8 [(f) deductions for recovery of advances of whatever nature (including advances for travelling allowance or conveyance allowance), and the interest due in respect thereof, or for adjustment of over-payments of wages;

(ff) deductions for recovery of loan made from any fund constituted for the welfare of labour [in accordance with the rules approved by the [State Government]], and the interest due in respect thereof;

(fff)deductions for recovery of loans granted for house-building or other purposes [approved by the [state Government] and the interest due in respect thereof;]]

(g) deductions of income-tax payable by the employed person;

(h) deductions required to be made by order of a Court or other authority competent to make such order;

(i) deductions for subscriptions to, and for repayment of advances from any provident fund to which the Provident Funds Act, 1925 (19 of 1925), applies or any recognized provident fund as defined 9 [in section (38) of section 2 of the Income-tax Act, 1961], or any provident fund approved in this behalf by the State Government, during the continuance of such approval;] 10 [***]

(j) deductions for payments to co-operative societies [approved by the [state Government] 6 [or any officer specified by it in this behalf]] or to a scheme of insurance maintained by the Indian Post Office; 11 [and]

11 [12 [(k) deductions, made with the written authorisation of the person employed for payment of any premium on his life insurance policy to the Life Insurance Corporation of India established under the Life Insurance Corporation Act, 1956 (31 of 1956), or for the purchase of securities of the Government of India or of any [state Government] or for being deposited in any Post Office Savings Bank in furtherance of any savings scheme of any such Government.]]

13 [(kk) deductions made, with the written authorisation of the employed person, for the payment of his contribution to any fund constituted by the employer or a trade union registered under the Trade Union Act, 1926 (16 of 1926), for the welfare of the employed persons or the members of their families, or both, [and approved by the [state Government] or any officer specified by it in this behalf, during the continuance of such approval;]

(kkk) 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 registered under the Trade Unions Act, 1926 (16 of 1926);]

6 [(l) deductions, for payment of insurance premia on Fidelity Guarantee Bonds;

(m) deductions for recovery of losses sustained by a railway administration on account of acceptance by the employed person of counterfeit or base coins or mutilated or forged currency notes;

(n) deductions for recovery of losses sustained by a railway administration on account of the failure of the employed person to invoice, to bill,to collect or to account for the appropriate charges due to that administration; whether in respect of fares, freight, demurrage, wharfage and cranage or in respect of sale of food in catering establishments or in respect of sale of commodities in grain shops or otherwise;

(o) deductions for recovery of losses sustained by a railway administration on account of any rebates or refunds incorrectly granted by the employed person where such loss is directly attributable to his neglect or default;]

14 [(p) deductions, made with the written authorisation of the employed person, for contribution to the Prime Minister's National Relief Fund or to such other Fund as the Central Government may, by notification in the Official Gazette, specify;]

15 [(q) deductions for contributions to any insurance scheme framed by the Central Government for the benefit of its employees.]

16 [(3) Notwithstanding anything contained in this Act, the total amount of deduc­tions which may be made under sub-section (2) in any wage-period from the wages of any employed person shall not exceed-

(i) in cases where such deductions are wholly or partly made for payments to co-operative societies under clause (j) of sub-section (2), seventy-five percent of such wages, and

(ii) in any other case, fifty, percent, of such wages:

Provided that where the total deductions authorised under sub-section (2) exceed seventy-five percent, or, as the case may be, fifty percent, of the wages, the excess may be recovered in such manner as may be prescribed.

(4) Nothing contained in thissection shall be construed as precluding the employer from recovering from the wages of the employed person or otherwise any amount payable by such person under any law for the time being in force other than 17 [ theRailways Act, 1989.]

1. Substituted vide Payment of Wages (Amendment) Act, 2005. Previous text was "sub-section (2) of section 47 of the Indian Railways Act, 1890 (9 of 1890)"

2. Explanation re-numbered as Explanation I by Act 68 of 1957, section 5 w.e.f. 1-4-1958.

3. Inserted by Act 68 of 1957, section 5 w.e.f. 1-4-1958.

4. Substituted by Act 68 of 1957, section 5, for clause (d) w.e.f. 1-4-1958.

5. The words "Governor-General in Council or" omitted by the A.O. 1937.

6. Inserted by Act 53 of 1964, section 6 w.e.f. 1-2-1965.

7. Substituted by Act 56 of 1974, section 3 and Schedule II, for "this sub-clause".

8. Substituted by Act 53 of 1964, section 6, for clause (f) w.e.f. 1-2-1965.

9. Substituted vide Payment of Wages (Amendment) Act, 2005

10. The word "and" omitted by Ordinance 3 of 1940, section 2.

11. Added by Ordinance 3 of 1940, section 2.

12. Substituted by Act 68 of 1957, section 5, for clause (k) w.e.f 1-4-1958.

13. Inserted by Act 38 of 1982, section 7 w.e.f. 15-10-1982.

14. Inserted by Act 29 of 1976, section 4 w.e.f 12-11-1876.

15. Inserted by Act 19 of 1977, section 2, w.e.f. 30-6-1977.

16. Inserted by Act 53 of 1964, section 6 w.e.f. 1-2-1965.

17. Substituted vide Payment of Wages (Amendment) Act, 2005


Section 8. Fines

(1) No fine shall be imposed on any employed person save in respect of such acts and omissions 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 omissions shall be exhibited in the prescribed manner on the premises in which the employment is carried on or in the case of person 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 to1[three per cent.] of the wages payable to himin respect of that wage-period.

(5) No fine shall be 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 installments or after the expiry of2[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 allrealisations 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 allsuch realisations shall be applied only to such purposes beneficial to the persons employed in the factory or establishment as are approved by theprescribed authority.

Explanation.-When the persons employed upon or in any railway, factory or3[industrial or other establishment] are part only of a staff employed under the same management, allsuch realisations may be credited to a common fund maintained for the staff as a whole, provided that the fund shall be applied only to such purposes as are approved by the prescribed authority.

1. Substituted by Act 38 of 1982, section 8, for "half-an-anna in the rupee" w.e.f. 15-10-1982.

2. Substituted vide Payment of Wages (Amendment) Act, 2005. Previous text was sixty days

3. Substituted by Act 38 of 1982, for "industrial establishment" w.e.f. 15-10-1982.


Section 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 large 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 State 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.

1[Explanation.-For the purposes 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 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.]

1. Added by Act 22 of 1937, section 2.


Section 10. Deductions for damage or loss

1 [(1) A deduction under clause (c) or clause (o) ofsub-section (2) of section 7 shall not exceed the amount of the damage or loss caused tothe employer by the neglect or default of the employed person.

(1A) Adeduction 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 opportunityof showing cause against the deduction, or otherwise than in accordance with suchprocedure as may be prescribed for the making of such deductions.]

(2)All such deductions and all realisations thereof shall be recorded in aregister to be kept by the person responsible for the payment of wages undersection 3 in such form as may be prescribed.

1.Substituted by Act 53 of 1964, section 7, for sub-section (1)(w.e.f. 1-2-1965).


Section 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 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, in the case of deduction under the said clause (e), shall be subject to such conditions as 1 [***] the State Government may impose.

STATE AMENDMENTS

SECTION 11A

2 Pondicherry

After section 11, insert the following section, namely:--

"11A. The employer shall, if so required by a requisition in writing, by the Electricity Department of the Government of Pondicherry or by an officer authorized by it in this behalf, make the deductions authorized under clause (dd) of sub-section (2) of Section 7 from the wages of the employed person and remit the amount so deducted in such manner as the State Government may, by general or special order, specify."

3 Tamil Nadu

After section 11, insert the following section, namely:--

"11A. Deductions in respect of house accommodation.--The employer shall make the deductions authorized under clause (d) of sub-section (2) of section 7 from the wages of the employed person and remit the amount so deducted in such manner as the State Government may, by general or special order specify."

SECTION 11B

4 Tamil Nadu

Same as section 11A in Pondicherry.

SECTION 11C

5 Tamil Nadu

After section 11B, insert the following section, namely:--

"11C. Deductions in respect of profession tax.--The employer shall, if so required by a requisition in writing, by the local authority concerned or by an officer authorized by it in this behalf, make the deductions authorized under clause (gg) of sub-section (2) of section 7 from the wages of the employed person and remit the amount so deducted to the credit of the local authority concerned in such manner as the State Government may, by general or special order, specify."

1. The words "the Governor-General in Council or" omitted by the A.O. 1937.

2. Vide Pondicherry Act 9 of 1970, section 3 (w.e.f. 25-5-1970).

3. Vide Tamil Nadu Act 9 of 1959, section 4 and Act 14 of 1962, section 2 and First Schedule (w.e.f. 9-1-1963).

4. Vide Tamil Nadu Act 20 of 1963, section 3 (w.e.f. 6-11-1963).

5. Vide Tamil Nadu Act 47 of 1974, section 3.


Section 12. Deductions for recovery of advances

Deductions under clause (f) of subsection (2) of section 7 shall be subject to the following conditions, namely:--

(a) recovery of an advance of money given before employment began shall be made from the first payment of wages in respect of a complete wage-period, but no recovery shall be made of such advances given for travelling-expenses;

1[(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 subject to any rules made by the State Government regulating the extent to which such advances may be given and the instalments by which they may be recovered.

1. Inserted by Act 53 of 1964, section 8 (w.e.f. 1-2-1965).


Section 12A. Deductions for recovery of loans

1 [12A. 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 thereon.]

1. Inserted by Act 53 of 1964, section 9 (w.e.f. 1-2-1965).


Section 13. Deductions for payments to co-operative societies and insurance schemes

Deductions under clause (j)1[and clause (k)] of sub-section (2) of section 7 shall be subject to such conditions as the State Government may impose.

STATE AMENDMENT

2Karnataka

In section 13,

(1) for the headline the following heading shall be substituted, namely--

"13. Other deductions."

(2) for the words, letters and brackets, "under clause (j) and clause (k)" the words, letters and brackets, "under clause (j), clause (k) and clause (q)" shall be substituted.

1. Inserted by Ordinance 3 of 1940, section 3.

2. Vide Karnataka Act 2 of 1977 as amended by Karnataka Act 2 of 1982 section 3 (w.e.f. 28-1-1982).