8/7/2019 15114406 Wage Policy in India
1/15
8/7/2019 15114406 Wage Policy in India
2/15
CONCEPT OF WAGE
MeaningImportance
How its different from compensation, income and salary
Types of wagesMethods of wage payment
8/7/2019 15114406 Wage Policy in India
3/15
PAYMENT OF WAGES ACT1936
y OBJECTIVES
Regulating payment of wages
Imposing fines/deduction from wages
Laying down `Wage period`
Time and Mode of payment of wages
To prevent malpractices by employers.
8/7/2019 15114406 Wage Policy in India
4/15
Scopey This acts applies to those persons employed directly or
indirectly in
1. Factory
2. Railway
3. Air Transport Services
4. Mines or oil field
5. Workshop in which articles are manufactured orproduced
6. State / Central Government establishment
8/7/2019 15114406 Wage Policy in India
5/15
Coveragey
Applies to employees drawing wages upto 6500 Rs.y This limit will be suitably increased by central
Government after every 5 years.
y
Wages means all remuneration expressed in terms ofmoney and includes remuneration payable under anyaward or settlement, overtime wages ,wages for holidayand any sum payable on termination of employment
(bonus is not included).
8/7/2019 15114406 Wage Policy in India
6/15
Employers Obligations
y Fixation of wage period- Daily, Weekly, Fortnightly, Monthly
y Time of payment- 7th day after wage period [working day]
y 10th day [employees more than 1,000]
y
Mode of payment-Coins and currency notesy Payment in Case of Death of Employee Nominee or
prescribed authority
y Returns/Registers and Records-To file annual return by
the 15
th
Feb. of following year.
8/7/2019 15114406 Wage Policy in India
7/15
Permissible Deductionsy
Maximum deductions
50%;
wherecontribution to Cooperatives - 75%y Grounds - Absence from duty Fines
Damages/loss caused Recovery of Advances TDS Employees` ESIC, PF Contributions, LIC
premium Amenities provided Court Orders [Recovery]
8/7/2019 15114406 Wage Policy in India
8/15
THE MINIMUM WAGES ACT1948
OBJECTIVES
To provide for Minimum wages for certain
employees
To stop exploitation of labour
The acts also provides for maximum daily
hours, weekly rest day and overtime
8/7/2019 15114406 Wage Policy in India
9/15
fixing minimum wages
By The Government-y The no. of working hours in day with one or more
intervals.
y
Provide for a paid rest day in every period of 7 daysy The minimum wages rates will be different for
different classes of employees- skilled, semi skilled,unskilled .
8/7/2019 15114406 Wage Policy in India
10/15
TerritoryofDelhi - Minimum wages
8/7/2019 15114406 Wage Policy in India
11/15
Obligations of Employersy Payment of minimum wages- The employer is bound to
pay to every employees minimum wages.
yWages in cash-wages should be paid in cash.
y Overtime Wages-Twice the normal wages.
y
Payment of Undisbursed amount- On account of deathof employee then same shall be deposited to prescribedauthority.
8/7/2019 15114406 Wage Policy in India
12/15
Penalties
Payment of Wages less than fixed minimumwages
y Imprisonment upto 6 months or fine upto Rs.
5oo or both
Contravention of any Rule or order
y
Fine upto Rs. 500
8/7/2019 15114406 Wage Policy in India
13/15
Determinants of wages
8/7/2019 15114406 Wage Policy in India
14/15
Flaws In Indian Wage System
y
Wages are not decided by market forces instead theyare decided by institutions.
y
Implementation of laws is not proper.
yWages in organized sector are fix but in unorganized
sector in Indian wages are not fixed.
8/7/2019 15114406 Wage Policy in India
15/15
contdy
Piece wage system should be introduced instead fixwage system so that competitive prices of products canbe introduced.
y Organization should revised wage as per marketconditions.