The Ministry of Law and Justice (Legislative Department) vide its Notification dated 16th February, 2017/Magha 27, 1938 (Saka) pursuant to receiving of the assent of the President published for general information the Payment of Wages (Amendment) Act, 2017 to amend the Payment of Wages Act, 1936 (the 'Act').

The Act applies in the first instance to the payment of wages to persons employed in any factory, to persons employed (otherwise than in a factory) upon any railway by a railway administration or, either directly or through a sub-contractor, by a person fulfilling a contract with a railway administration, and to persons employed in an industrial or other establishment specified in sub-clauses (a) to (g) of clause (ii) of section 2. The Act applies to wages payable to an employed person in respect of a wage period if such wages for that wage period do not exceed eighteen thousand rupees per month or such other higher sum which, on the basis of figures of the Consumer Expenditure Survey published by the National Sample Survey Organisation, the Central Government may, after every five years, by notification in the Official Gazette, specify.

By virtue of this Notification, this Amendment Act came into force on the 28th day of December, 2016. The Amendment Act substituted the exiting section 6 of the Payment of Wages Act, 1936, with the following

"All wages shall be paid in current coin or currency notes or by cheque or by crediting the wages in the bank account of the employee:

Provided that the appropriate Government may, by notification in the Official Gazette, specify the industrial or other establishment, the employer of which shall pay to every person employed in such industrial or other establishment, the wages only by cheque or by crediting the wages in his bank account."

Section 6 earlier provided that the wages shall be paid in current coins or currency notes or in both; provided that the employer may, after obtaining the written authorisation of the employed person, pay him the wages either by cheque or by crediting the wages in his bank account.

Apparently the payment of wages by way of cheque or crediting the waged directly to the bank account of the employee have now been introduced. Also, taking of authorization from the employee for payment of wages either by cheque or by way of crediting directly in the account has been done away with.

Taking genesis from Government's crucial policy of giving priority to electronic mode of transacting, this surely will smoothen the procedure of payment of wages and at the same time make it less cumbersome to maintain records.

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