12/29/2016 Government Clarification on Amendment to Payment of Wages Act - The Synthetic & Rayon Textiles Export Promotion Council

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GOVERNMENT CLARIFICATION ON AMENDMENT TO PAYMENT OF WAGES ACT

Circular No.ES/242/2016-17 December 22, 2016

To: Members of the Council
Sub: Government Clarification on Amendment to Payment of Wages Act
Dear Member,
The Council is glad to inform you that the Government of India has given clarification on Amendment to Payment of Wages Act, 1936 that the
option of payment through cash is still available with the employers vide Press Release dated 21st December, 2016.
(http://pib.nic.in/newsite/PrintRelease.aspx?relid=155718)
It is observed from the media reports that there is a general impression being created that the Government is bringing an amendment to the
Payment of Wages Act to make compulsory the payment of wages to the workers only through cheque or accounts transfers, which is not the
correct position.
In this regard, it is clarified that the government proposes to bring an amendment to Section 6 of the Payment of Wages Act
(http://www.labour.nic.in/sites/default/files/ThePaymentofWagesAct1936.pdf) which will further provide crediting the wages in the bank account of
the employees or payment through cheque along with the existing provisions of payment in current coin or currency notes in order to facilitate the
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12/29/2016 Government Clarification on Amendment to Payment of Wages Act - The Synthetic & Rayon Textiles Export Promotion Council

employers from making payment of wages. This is being done to facilitate the employers from making payment of wages using the banking
facilities also in addition to the existing modes of payment of wages in current coin or currency notes.
Also, the appropriate Government (Centre or State) will have to come up with the notification to specify the industrial or other establishments
where the employer shall pay wages through cheque or by crediting the wages in employees bank account. Thus, it is clear that the option of
payment through cash is still available with the employers for payment of wages. The above proposed amendment will also ensure that minimum
wages are paid to the employees and their social security rights are protected.
Members may kindly make note of the same.
Thanking you,
V. ANIL KUMAR
EXECUTIVE DIRECTOR

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