Read Text of Bill here. Some States have already brought this Amendment.
Today Centre Govt. took a decision to bring in an Ordinance for amendment of the Payment of Wages Act to mandate the business and industrial establishments to pay salaries to the employees and workers through cheques or electronic transfer.
Union Cabinet has approved the Ordinance route to bring amendment in the Payment of Wages Act, 1936, to allow employers of certain industries to make payment through the electronic mode and cheques.
Employers will continue to have the option to pay wages in cash as well.
Once the Government ibrings an ordinance to amend laws, it would remain valid for six months only. Thereafter Government would be required to get it passed in Parliament.
The Payment of Wages (Amendment) Bill, 2016, is aimed to amend Section 6 of the Act to enable employers to pay wages to employees through cheques or by electronically crediting it to their bank accounts.
Labour Minister Bandaru Dattatreya introduced the Bill amid din over the demonetisation issue.
Sstate governments will be empowered to specify industrial or other establishments who will have to adopt cashless way for salary payments.
The new procedure of the Bill will serve the objective of “digital and less-cash economy.
The original Act come into force on April 23, 1936.
The specific provision for payment of wages by cheque or crediting it into bank account of workers after obtaining the requisite authorisation of employee was inserted in 1975.
Currently, the Actgoverns all those employees of establishments whose wage does not exceed Rs.18,000 per month.
Centre has the Power to make rules regarding payment of wages in relation to air transport services, mines, railways, oil fields and its establishments whereas States take a call on all other cases.
States like Andhra Pradesh, Uttarakhand, Punjab, Kerala and Haryana have already made such provisions for payment of wages through cheque and electronic transfer.
At present, it is only with the written authorisation of an employee, that the wages can be given through cheque or transferred to his or her bank account.
Read Law here-