Proposals to pay wages to employees either by cheque or by crediting it to their bank account says Ministry

The Ministry of Labour and Employment (“Ministry”) has issued a Notification F. No. S-31012/2/2016-WC dated 2nd December, 2016 informing its intention to make certain amendments in Section 6 of Payment of Wages Act, 1936 (“Act”) whereby it will be made mandatory for employers of certain industrial or other establishment to pay wages to their employees either by cheque or by crediting the wages in their bank account.

 Any objections or suggestions on the same should be sent to the Secretary, Ministry of Labour and Employment, Shram Shakti Bhawan, Rafi Marg, New Delhi-110001 by 16th December, 2016.

 Keeping pace with advancement in technology, progress in mobile banking and innovative technologies facilitating digital payments in the recent years and in the light of Government of India’s policy decisions encouraging cashless/electronic transactions, following amendments are being proposed:

 As per the proposed amendment, the employer of every industrial or other establishment as notified by the Appropriate Government will mandatorily have to pay to every person employed in such industrial or other establishment, the wages either by cheque or by crediting the wages in his bank account.

 At present, such payment through cheque or by crediting the wages in the employees’ bank account is not mandatory. The employer could make payment of wages through bank account or cheque after obtaining the written authorization of the employed person.

Source: Ministry of Labour and Employment