Payment of Wages Bill Passed

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Parliament has passed the Payment of Wages Amendment Bill 2017.

The Bill replaces the Payment of Wages Ordinance, 2016 which was promulgated on December 28, 2016.

The Bill amends the 1936 Act to permit the employer to pay an employee’s wages: (i) in coin or currency notes; or (ii) by cheque; or (iii) by crediting them into his bank account.

The Bill removes the requirement of obtaining written authorisation for payment of wages by cheque or through a bank account.

Method of payment of wages: Under the 1936 Act, all wages must be paid either in coin or currency notes, or both. However, the employer may pay his employee’s wages either by cheque or by crediting it into his bank account, after obtaining his written authorisation.

However, the relevant central or state government may specify certain industrial or other establishments where the employer should pay his employees only by: (i) cheque; or (ii) crediting the wages in his bank account.

It specifies industrial units which will have to pay wages only either through cheques or by transferring into bank accounts.

Section 20 of the bill “provides for six months imprisonment for violation of the Act. Moreover the inspector can initiate appropriate action under the Factories Act 1948.”

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