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Code on wages 2019

P C Agrawal (Vice President (Corporate))     23 July 2019

P C Agrawal
Vice President (Corporate) 
 823 likes  8065 points

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PFA Bill for Code on Wages 2019 introduced in Lok Sabha today.  It intends to amalgamate, simplify and rationalise the relevant provisions of the following four central labour enactments relating to wages, namely:—

(a) the Payment of Wages Act, 1936;

(b) the Minimum Wages Act, 1948;

(c) the Payment of Bonus Act, 1965; and

(d) the Equal Remuneration Act, 1976.


The salient features of the Code on Wages, 2019, inter alia, are as follows:—


(a) it provides for all essential elements relating to wages, equal remuneration, its payment and bonus;

(b) the provisions relating to wages shall be applicable to all employments covering both organised as well as un-organised sectors;

(c) the power to fix minimum wages continues to be vested in the Central Government as well the State Government in their respective sphere;

(d) it enables the appropriate Government to determine the factors by which the minimum wages shall be fixed for different category of employees. The factors shall be determined taking into account the skills required, the arduousness of the work assigned, geographical location of the workplace and other aspects which the appropriate Government considers necessary;

(e) the provisions relating to timely payment of wages and authorised deductions from wages, which are presently applicable only in respect of employees drawing wages of twenty-four thousand rupees per month, shall be made applicable to all employees irrespective of wage ceiling. The appropriate Government may extend the coverage of such provisions to the Government establishments also;

(f) it provides that the wages to employees may also be paid by cheque or through digital or electronic mode or by crediting it in the bank account of the employee.  However, the appropriate Government may specify the industrial or other establishment, where the wages are to be paid only by cheque or through digital or electronic mode or by crediting the wages in the bank account of the employee;

(g) it provides for floor wage for different geographical areas so as to ensure that no State Government fixes the minimum wage below the floor wage notified for that area by the Central Government;

(h) in order to remove the arbitrariness and malpractices in inspection, it empowers the appropriate Government to appoint Inspectors-cum-Facilitators in the place of Inspectors, who would supply information and advice the employers and workers;

(i) it empowers the appropriate Government to determine the ceiling of wage limit for the purpose of eligibility of bonus and calculation of bonus;

(j) in the place of number of authorities at multiple levels, it empowers the appropriate Government to appoint one or more authorities to hear and decide the claims under the proposed legislation;

(k) it enables the appropriate Government to establish an appellate authority to hear appeals for speedy, cheaper and efficient redressal of grievances and settlement of claims;

(l) it provides for graded penalty for different types of contraventions of the provisions of the proposed legislation;

(m) it provides that the Inspector-cum-Facilitator shall give an opportunity to the employer before initiation of prosecution proceedings in cases of contravention, so as to comply with the provisions of the proposed legislation. However, in case of repetition of the contravention within a period of five years such opportunity shall not be provided;

(n) it provides for the appointment of officers not below the rank of Under Secretary to the Government of India or an officer of equivalent level in the State Government to dispose of cases punishable only with fine up to fifty thousand rupees, so as to reduce the burden on subordinate judiciary;

(o) it provides for compounding of those offences which are not punishable with imprisonment;

(p) it provides that where a claim has been filed for non-payment of remuneration or bonus or less payment of wages or bonus or on account of making deduction not authorised by the proposed legislation, the burden shall be on the employer to prove that the said dues have been paid to the employee;

(q) it enables the appropriate Government to constitute Advisory Boards at Central and State level to advice the Central Government and the State Governments, respectively, on matters relating to wages, women employment, etc.;

(r) the period of limitation for filing of claims by a worker has been enhanced to three years, as against the existing time period varying from six months to two years, to provide a worker more time to settle his claims.


PC Agrawal


Attached File : 9367 20190723144705 code on wages 2019.pdf downloaded: 53 times

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